California Homeowners Insurance

 
California Homeowners Insurance

Residents in California pay an average of $82 per month or $986 per year in home insurance premiums. 


There are over 14 million homes in The Golden State, fifty-four percent of which are owner-occupied.

The average monthly cost for a homeowner with a mortgage in California is $2,157.

Residents in California pay an average of $82 per month or $986 per year in home insurance premiums. 


There are over 14 million homes in The Golden State, fifty-four percent of which are owner-occupied.


The average monthly cost for a homeowner with a mortgage in California is $2,157.

Shop around and save.

Compare insurers to find the cheapest rates around.

 

California Statistics*

​39,536,653

Population

​$409,300

Average value of owner-occupied housing units

​12,807,387

Households

​$63,783

Average household income

82%

High school grad or higher, percent of people age 25 years +

28 min

Average travel time to work

*Data from the U.S. Census Bureau


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California is a state with one of the most diverse landscapes. There are mountains, old growth forests, beaches and deserts. Due to such diversity, the area is prone to natural disasters such as wildfires, earthquakes, multi-slides and others. Therefore, anybody that owns a house in California should effectively get home insurance to shield their home from the damages that may occur from disastrous events. 


Homeowners insurance in California provide different types of protection. The most standard home insurance policy covers the home and its belongings and protection against injury. The types of insurance policy run from HO-1 to HO-8  depending on the market value of your property.


However, following the wide spread of wildfires in 2017, a handful of homeowners insurance companies in California refuse to insure homes in the prone areas. It is unfortunate that most insurers don’t cover earthquake related problems. In 2016 only 11% of homeowners in California were insured against earthquakes. However, you can always obtain earthquake insurance coverage from the California Earthquake Authority.

When buying a home, one of the things you will need to get is homeowners insurance. With homeowners insurance, you will have a policy that will protect you from having to spend large sums of money on repairs from catastrophic natural events. The State of California does not require homeowners to purchase insurance for their homes although the mortgage lender most likely will. Like any other insurance policy, there are a number of things that you will need to consider when looking for coverage. Some examples are finding out what type of coverage is suitable for your needs by considering the value and location of your house and comparing premiums to gauge what's fair market price. By focusing on these things, you will be in a great position to get the right coverage at the best price around.


California home insurance premiums versus nationwide


The good news is that California’s annual average premium of $986 is lower compared to the national average. This means Californians are paying $187 less yearly than the average American. Home insurance have increased steadily for the last 10 years in the US. The National Association of Insurance Commissioners (NAIC) conducted a study in January 2018 to determine the expenditure of insurance in the country. According to the study, insurance expenses started to rise in 2014 by 3.3% while in 2015 it rose by 3.6%. 


California property/casualty insurance companies wrote a total of $73 billion in direct premiums in 2016 alone. Devastating natural events swept the state causing property/casualty claims payouts, totaling $43 billion in the same year. Let's highlight that insurers paying their claims help the economy by guaranteeing a person's financial stability while sustaining local businesses. This may be the reason that the yearly average home insurance premiums in California continue to rank below the country's average. Certain areas in The Golden State are prone to wildfires and other disastrous natural events that make insuring your home inevitable, it seems. The strong performance in claims payout and the relatively low ranking of 30th out of all 51 states for average home insurance premiums project that there's nothing to worry about when it comes to home insurance in California.

Average California home insurance premiums

 20142015
Monthly average$81$82
Annual average$974$986
National annual average$1,132$1,173
Rank3130
Source: Insurance Information Institute

The best homeowners insurance companies in CA


We arrived at our best homeowners California insurance companies through reviewing homeowners insurance reviews and customer satisfaction. A company must display financial strength in order to be deemed trustworthy to be able to pay claims when time comes. First and foremost a company’s customer service rankings is looked at and also its financial stability. The various discounts rates and variety of coverage that customers can choose from are also considered. The following are our top homeowner insurance companies in California.


State Farm


State Farm lives up to its motto “Like a good neighbor, State Farm is there.” The company keeps a clean record in customer satisfaction and claims payout department while maintaining financial strength.


AM Best gave a rating of A++ (Superior) which is the highest rating possible. Standard and Poor’s also rated very high with AA. JD Power rated 3 (About average) in The US Home Insurance Study, which examined customer satisfaction. Satisfaction is calculated by closely looking at five factors: communication, policy offerings, billing process and policy information and claims. The JD Power study made up of of approximately 14 thousand homeowners and renters who were interviewed online during summer 2018. This study is important to mention as high satisfaction ratings could mean excellent claims payout history. Getting your home insured by State Farm means that you've picked a financially stable company with great customer service.


In this technology age, it’s important for insurance companies to have an online presence that’s useful to consumers. You can file a claim with State Farm 24/7 using their website or through phone. State Farm offers a calculator that will help you figure out how much insurance you need. In addition, they offers various discounts that will enable you to enjoy price reductions up to 22% i.e. the multi-policy discount.


Farmers 


Founded in 1926, Farmers is a California-based insurance company that offers a wide range of insurance services, including homeowners insurance. Farmers is known to have solid financials, large network of agents and low consumer complaints records. It’s easy to see why they have gained popularity among Californians, holding the second top spot at 16 percent of the market share in CA. One of the leading home insurance companies in the US, they offer optional coverages to accompany their standard home insurance policies. 


Farmers maintains stable financial ratings across the board. AM Best gave a rating of A+ and S&P rated A, reflecting strong financials. According to Consumer Advocate, they have a low consumer complaint record which is notable for a company its size. Farmers cover a wide area in California making it an ideal choice for those who want to ensure that local or regional disastrous events are handled well.


Farmers is considered a stable choice, being in business for almost a century. A standard policy includes coverage for damages that occur to the insured home and its valuables, any policyholder liabilities, injured people’s medical payment that occurred on site, and/or additional expenses for living for up to one year if the insured home is deemed unlivable. Additional coverage is available for rare items.


Consumers can enjoy Farmers’ app or browse their website along with speaking with an agent over the phone from their large network. All in all, Farmers is a great choice. It’s a known homeowners insurance provider that has a large market share in California. Be sure to check out their rates and compare it with other providers in your area to ensure that you are getting the best possible rates from insurers near you.


CSAA


CSAA remains in the top 10 home insurance companies in the US. They perform well in California, ranking 3rd only to State Farm and Farmers, with 6.6 percent of the market share. CSAA was affirmed its A+ (Superior) financial strength rating from AM Best and has maintained a rating of A or higher for more than 85 years. 


CSAA offers standard plans that are sufficient to protect your home. They offer a wide variety of discounts that help consumers save money. Installing a safety device and bundling multiple policies are some of the things you can do to earn savings from CSAA. Seniors of 50 years and older can enjoy a 12 percent discount. Fix your roof to resist fire and enjoy savings up to 13.5 percent. CSAA offers competitive rates with coverage that will protect your home.


Allstate


Allstate earns top industry ratings. It recently returned to California in 2016 after 9 years of absence. Allstate has a rating of A+ from AM Best, highlighting financial stability. In addition, Allstate makes good payouts and has one of the best consumer rankings in best payment process and claims process. 


JD Power’s  customer satisfaction results on Allstate is at 3 out of 5 power circles, with a handful insurance companies scoring above 3. Furthermore Allstate has flexible insurance coverage. If you are looking to have extra coverage you will most likely be granted. Such covers include; identity theft, sewer and water damage and liability of umbrella coverage. 


There are also numerous discounts such as reduced price on multi- line insurance policies. The most exciting part is that Allstate offers lower premiums for new and renovated homes. Lastly, Allstate is famous for having an online feature that lists claims by zip codes. 


For instance if you reside in LA 90004 zip code, the most costly claim is smoke damage, while the most common claim is theft. One can use this feature to determine the type of insurance cover they need. Once you install features like a burglar alarm, you become eligible for discounts that will help cut the monthly costs associated with homeowners insurance.


Liberty Mutual


On financial stability, Liberty ranked a little lower than Allstate at an A+ rank by A.M Best. From JD Power, Liberty received very good ratings on consumer reports. It managed a 3 out of 5 power circles, meaning that most customers are satisfied with the way they handle claims. However, Liberty offers a limited amount of discounts as compared with Allstate.


Liberty Mutual has an upper hand when it comes to availability of resources and educational tools. The company takes you through their home insurance policy. In addition, it also have two mobile apps where you can manage the policy and claims; the other one aids in managing home inventory. People who experienced multi slides and wildfires in 2017 and 2018 reported that not having a home inventory made the claim process very complicated. Therefore, Liberty's mobile app is a handy feature that may prove to be useful in the event of a claim.

California home insurance companies: Market share and summary of ratings

RankInsurerMarket share %AM BestS&PJD Power
1State Farm17.4A++AA3
2Farmers16.1AA3
3CSAA6.6ANR3
4Auto Club Exchange6.4ANR3
5Liberty Mutual6.2AA3
6Allstate6.2A+AA3
7USAA5.0A++AA+5
8Mercury4.9A+NR3
9Nationwide4.4A+A+3
10Travelers3.2AA3

NR: Not rated
Source: Insurance Information Institute

How to find the best rates around


California has the largest insurance market in the United States and ranks the sixth in the world. As a homeowner looking for home insurance, access to the best rates is invaluable. Shopping around and getting quotes from as many reliable companies as possible will ensure you that your home is covered at the most economic price around.


As a home insurance consumer, choosing the best homeowner insurance can be challenging. Most insurers advertise both online and on televisions and claim to be the best. Do your own research by reading reviews of your selected companies to be able to choose the best that suits your needs. Take a look at the insurance rating organizations' reports on financial strength, customer satisfaction and the type of claims services available before making a choice.


4 factors which may affect homeowners insurance in CA

The owner-occupied housing unit rate in California is something like 54 percent. Surely, California is one of the most popular states to live in the US. Have you too got your new den in California? Well then, the next step is to get a strong homeowners insurance policy. Not that there are factors that affect or influence your rate of homeowners insurance in California. Here are 4 factors which may play a key role in determining your homeowners insurance premium.


Your credit score


This is one of the major factors which may affect your homeowners insurance rates. According to insurers, clients with low credit scores are most likely to lodge a claim. Such conception derives from the fact that a responsible person is always particular with his bills and hence is able to maintain a higher score. On the other hand, people with lower scores are often the ones who are not punctual with the bills and not careful with credit limit. Such facts lead to the belief, if you have low credit score, you are not responsible enough. It means you won’t be able to take care of the security of your home which will land up in frequent claims on your part. As a result, insurance companies impose higher premiums on those with low scores and offer lower premiums to those with an excellent credit rating.


Home business


When you run your business in your home, you are going to receive your clients, employees and vendors at your residential premise. Heavy traffic increases the chances of accidents and injuries at the premise which is always lower when there are less people at home.


Thus, insurance companies pose higher premiums on homes that also host an office. If you are in a similar situation, sign up for an “endorsement” coverage added to your regular homeowners insurance policy. It will assure additional coverage and extra liability coverage for your property. You can also invest in a special in-home business insurance policy. 


Age of home


Old homes are more prone to damage than new homes. Thus, California homeowners insurance companies generally offer higher premiums when it comes to insuring old homes. Thus, if you are about to buy and still haven’t bought a home in the State, avoid older ones. If you have bought an old one already, try to make updates in electrical, plumbing, heating and roof to keep it at par with the latest homes. Your insurance company will invariably treat you with lower premiums for updating your home as per modern standards- regardless of its age.


Marital status


Interestingly, marital status of the policyholder also plays a major role in determining the rate of the homeowners insurance policy in California. Married people are considered to be more mature than unmarried ones. Hence they are assumed to be more unlikely to make frequent claims. Thus, homeowners insurance companies in the State generally pose comparatively higher rates on unmarried policyholders.


What home insurance covers in CA


After buying a home and getting a California Homeowners insurance policy, you will want to know what it covers. Fortunately, a California home insurance policy covers a number of things that will ensure that you and your home are protected. Homeowners insurance policies protect a number of structures such as the home, the garage and the deck. It also provides coverage for other structures on the property such as the shed and any fences.


Along with covering a number of property structures, homeowners insurance policies cover your personal belongings. You will be able to get coverage for things such as furniture, electronics and collectibles As a result, you will be able to easily replace any items that are lost, stolen or damaged.

Homeowners insurance in California also covers natural disasters. In case your home is damaged in a mudslide or an earthquake, you will get compensation in order to pay for any damages. The policy will give you the funds to not only repair damaged property, but also replace structures that have been damaged as well.


Lastly, homeowners insurance provides liability coverage. Whenever a person gets injured in your home or on your property, you will have the ability to get compensation for it. For example, if someone who doesn’t live with you visits your home and gets injured, you won’t have to worry about paying any of their medical costs. You will also be protected from any potential lawsuits as well. Therefore, liability coverage is a very valuable part of any homeowners insurance policy in California.


Tips to save money


Since homeowners insurance in California can be costly, it is important to find ways to save money. One of the best ways to save money on homeowners insurance in California is to shop around. It will be a good idea to check out the premiums offered by a number of insurance companies and then compare them. You will also want to go over all of the available coverage in order to determine value. By following these steps, you will be in position to get the homeowners insurance you need at an affordable rate.


The easiest way to compare your options in California is to use our search tool at the top of this page. You need to enter your Zip and the system will provide you with the list of top insurers in your area.

For more assistance, please contact your local state department of insurance:

California Department of Insurance

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