If you own a home in the Bay Area, you’ve likely noticed that securing—or even keeping—home insurance has become more challenging than ever. With wildfires, floods, and earthquakes becoming increasingly common, many insurers are pulling out of high-risk areas or dramatically raising premiums.
So, what’s going on—and what can you do to protect your most valuable asset?
Why Are Insurance Companies Leaving California?
Over the past few years, major insurers like State Farm and Allstate have limited or stopped writing new homeowner policies in parts of California, including the Bay Area. Their reasons?
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Skyrocketing wildfire risk
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Rising repair and rebuilding costs
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Increased frequency of climate-related disasters
Even if your home isn’t in a high-fire zone, proximity alone can impact your eligibility or premiums.
What This Means for Homeowners
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Non-renewals: Many homeowners are receiving notices that their policies will not be renewed.
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Higher premiums: Those who can keep coverage are often shocked by premium hikes—sometimes double or triple what they paid last year.
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Limited options: The pool of insurers willing to cover homes in certain areas has shrunk, leaving homeowners with fewer and more expensive choices.
đź’ˇ What You Can Do
1. Shop Early and Shop Smart
Start comparing quotes well before your renewal date. Some smaller or regional insurers are still writing policies, and a local insurance broker can help you navigate the limited options.
2. Consider the CA FAIR Plan
This state-backed insurance is a last resort for homeowners who can't find coverage elsewhere. It offers basic fire coverage but requires a separate policy for liability and theft. It’s not ideal—but it’s better than being uninsured. Check this LINK for more information.
3. Harden Your Home
Insurers look favorably on homes with defensible space, ember-resistant vents, fire-resistant roofing, and other wildfire mitigation features. Many counties even offer grants to help with these upgrades.
4. Understand Your Policy
Make sure you’re covered for what you actually need—especially in the event of floods or earthquakes, which are not included in standard policies.
5. Stay Informed
This is a rapidly evolving issue. Subscribe to updates from the California Department of Insurance and check for local government programs that might help.
My Take as a Local Realtor
This issue is affecting buyers and sellers alike. In some cases, deals fall through when insurance is unavailable or unaffordable. A new "insurance contingency" is becoming more common in real estate transactions in areas facing rising home insurance costs or coverage challenges, not only in California, but also in Florida and Texas (areas with wildfire or hurricane zones). If you're planning to sell, be proactive—understand your home's insurability and communicate with potential buyers upfront. If you're buying, make sure your insurance is locked in before you remove contingencies.I work with experienced insurance brokers and can help connect you with the right resources to make informed decisions.
Final Thoughts
Navigating home insurance in the Bay Area has become a complex process—but you're not alone. Whether you're buying, selling, or staying put, staying informed and planning ahead is key.
Have questions or want to know how this might affect your home or neighborhood? Let’s talk. Contact me today.
đź“© anna@finegroupre.com
📱 408-649-8351
đź”— www.finegroupre.com
