Best Homeowners Insurance in California for 2024 | Bankrate (2024)

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Updated Sep 01, 2024

Compare the best homeowners insurance companies in California

Finding California home insurance can be difficult. A recent report from the California Association of Realtors found that, in 2023, almost 7 percent of real estate transactions in the state fell out of escrow because potential homeowners couldn’t find affordable insurance. Of that group, more than 61 percent claimed that they couldn’t find an insurer willing to write them a policy.

According to our research, USAA, Chubb, Nationwide, Travelers and Encompass are some of the best California homeowners insurance companies. Keep in mind, however, that there’s no guarantee these companies will agree to insure your home. To note, USAA, Nationwide, Travelers and Chubb are still actively writing policies in California but have scaled back the number of available policies.

We have confirmed that these carriers are currently writing homeowners insurance policies in California. However, coverage may be limited to certain areas of the state or homes with certain damage-mitigation features.

Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

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How Bankrate chose the best home insurance companies in California

California residents have multiple insurers to choose from, several of which offer more affordable premiums for homeowners insurance than the state average. To help you find the best home insurance company for you, we calculated a Bankrate Score to analyze each company across several categories. The rating sections include average annual premiums from Quadrant Information Services, available coverage, discounts and policy features. We also reviewed J.D. Power customer satisfaction ratings to indicate how satisfied customers are with their company’s service and AM Best ratings to assess financial stability. The higher a company ranked in each category, the higher its overall Bankrate Score — 5.0 being the highest possible.

Cheapest home insurance companies in California

Not every California homeowner will be able to secure a cheap policy, particularly those in a high-risk wildfire area. In fact, homeowners with homes at elevated risk for wildfire damage may struggle to secure any insurance policy, let alone a cheap one. That said, getting familiar with the cheapest home insurance companies in California can be a good starting point if you’re looking for coverage on a budget.

Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

How Bankrate chose the cheapest home insurance companies in California

Bankrate sources our rate data from Quadrant Information Services. In order to find the best cheap home insurance in California, we started by reviewing the most up-to-date rates available. From there, we narrowed the search to include rates from the larger insurers in the state by market share. Given the volatility of the California home insurance market, we ensured that each provider on our list is still writing policies in the state.

How to get cheap California home insurance

Finding the right California home insurance for your needs is an important part of securing your financial health. Home insurance is designed to help shield your finances from the fallout of unexpected home damage and can help you keep your finances intact if you suffer a loss. To find the best homeowners insurance in California at a price that works for you, you may want to consider these steps:

• Determine what you need. Home insurance needs can vary, so you may want to do some research to determine how much home insurance you need. This can help you avoid overpaying and underinsuring your home. Using an online tool can help. You may also want to make a home inventory of your personal belongings.
• Decide what factors matter most to you. When it comes to shopping for home insurance, finding the cheapest rate may be important to one shopper, while another shopper may need specialty coverage. For another shopper, having access to digital tools may be essential. That’s why it may help to assess what features in a home insurance company are important to you. Once you determine that, you can look for a company that meets those requirements.
• Search for companies. Once you have a list of factors that you’re looking for in a home insurance company, you can start your research. It may be a good idea to find several companies that meet your needs.
• Request quotes. Next, request quotes from the companies that you think might be a good fit. You’ll be able to review coverage offerings, discounts and average rates to determine which is going to ultimately be best for your coverage needs and budget.
• Buy your policy. Once you have a quote that you’d like to proceed with, your agent or a representative from the company will help you buy your home insurance.

Best home insurance discounts in California

Home insurance discounts are an easy way to lower your premium. Most major insurers offer at least a few savings opportunities that might help you get a cheaper rate. Here are some common home insurance discounts in California:

How to save on home insurance policy renewals in California

For better or for worse, your insurance premium is not permanent. If you’re looking to lower your home insurance rate without going through the trouble of changing insurers, there are a couple of steps you can take to secure a more favorable rate:

• Fortify your home against wildfire damage. Wildfire damage is a key concern for most home insurance providers in California, and you could be rewarded with a discount if you take measures to protect your home from wildfire damage.
• Minimize claims. You may not need to file a claim every time your home is damaged. In fact, it may even be cheaper in the long term to avoid it. Many home insurance providers view customers who have filed a claim in the past as more likely to do so in the future and charge higher rates to compensate. To avoid this surcharge, it may be cheaper to pay for certain types and amounts of damage out of pocket if you have the means.
• Raise your deductible — if you can afford it. Opting for a high-deductible home insurance policy may help you get a lower rate. However, be cautious when doing so, and make sure that your deductible is still something you can realistically pay at a moment’s notice without breaking your budget.
• Boost your home’s security. Shoring up your home’s security can do more than just give you added peace of mind, it may also result in added savings. Many insurance providers extend discounts to homeowners who take steps to further secure their homes. Depending on your insurer, this could be as simple as adding a deadbolt, or as involved as a whole-home alarm system.
• Ask about discounts. Home insurance policies typically renew annually, which leaves plenty of time to check for missed discounts. It may be worth setting aside some time with your insurance agent to see what discounts you potentially missed when you first signed up for your policy, and which ones you’ve only recently qualified for.

How much is home insurance in California?

The average cost of homeowners insurance in California for $300,000 in dwelling coverage is $1,456 per year. Although this is below the national average cost of homeowners insurance of $2,285 per year, the insurance premium for every home may be higher or lower than either of these averages depending on the home’s size, age and location, coverage options, and other individual rating factors. When looking for the best homeowners insurance in California, it’s helpful to consider how these factors could affect your final premium.

If you’re wondering why California’s home insurance rates are so low considering how risky the state is, it’s largely because of strict consumer protection laws. California state laws (Proposition 103, in particular) prohibit insurers from raising rates more than 7 percent without approval from the state’s Department of Insurance. As you can imagine, this clogs up the process and results in home insurance rates getting stuck at unsustainably low levels.

While this may seem like good news for homeowners, it is actually one of the many factors that contributed to the market instability plaguing the state.

Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

California homeowners insurance rates by city

When hearing that location can influence home insurance costs, many people’s minds jump to state-by-state cost considerations. While the state you live in plays a role in the cost of your insurance, so does your ZIP code. The interactive map below shows home insurance rates from across the state to help you compare.

What does home insurance cover in California?

Before panic-buying every home insurance endorsem*nt your insurer offers, it’s helpful to first understand which disasters are specifically covered in your policy. Once you have a better understanding of what’s covered by your home insurance policy, you can identify potential coverage gaps and purchase more coverage if you need it.

The most common type of home insurance policy is an HO-3. This type of home insurance provides dwelling coverage, other structures coverage and personal property coverage, in addition to liability, medical payments and additional living expenses. Your dwelling and other structures are typically insured on an “open peril” basis, meaning they are protected from everything except what is specifically excluded as outlined in your policy. Your personal property, however, is only protected from the losses, or “perils,” that are named in your policy.

A study from Mercury Insurance identified the most common insurance claims filed by California homeowners. We’ve listed them below by popularity and provided context on how they are already covered by a standard home insurance policy:

• Water damage: Water damage claims made up nearly 57 percent of California’s home insurance claims. Leaky appliances, burst pipes and other sudden and accidental water damage can all be covered by your home insurance policy. Notably, almost all home insurance policies do not cover flood damage.
• Wind: Home insurance can help when a gentle breeze turns not-so-gentle. High winds can damage your roof, siding and other areas of your home, but your home insurance policy could be able to help pay for the repairs.
• Fire: Your dwelling and personal property are financially protected from fire damage, with some key exceptions. Intentionally set fires are not covered by home insurance, and if you live in a wildfire-prone area, your insurer could exclude wildfire damage from your policy.
• Theft: While it’s not a natural disaster, theft can be just as devastating on a personal level. Theft is a named peril on the vast majority of home insurance policies and can cover your dwelling, other structures and personal property up to your specified coverage limits.

Additional home insurance coverage types in California

In a state prone to wildfires, mudslides and earthquakes, asking insurance companies specific questions about what your policy does and does not include is important. For instance, even though California is prone to earthquakes, home insurance companies do not typically include coverage for such incidents. Due to common natural disasters, many insurance experts recommend these extra coverage types for California homeowners:

• Earthquake coverage: Due to its position along the San Andreas Fault, California is one of the most earthquake-prone states in the country. You can usually purchase California earthquake coverage as a separate policy, often sold by the California Earthquake Authority. A private insurance company may also sell earthquake policies.
• Flood insurance: California is considered a flood-prone state due to its valleys and coastal land areas. However, standard home insurance does not include damage caused by floods. Instead, you can buy flood insurance through the National Flood Insurance Program (NFIP) and some private flood insurers.
• Fire insurance: Although coverage for some fires is included in basic homeowners insurance policies, Californians are at an increased risk because of the high probability of wildfires. If you live in an area where finding home insurance coverage is difficult because of the involved risk, you may consider purchasing a separate policy like the FAIR Plan. California FAIR Plan (CFP) recommends only getting coverage through its association as a last resort, but it could offer fire insurance for your home.
• Scheduled personal property: If you own high-value items, like artwork or jewelry, these may not be fully covered by the personal property coverage on your homeowners policy. Some solutions can be to increase your personal property coverage limits or purchase a scheduled personal property endorsem*nt as additional coverage. Because each insurance company may have different guidelines in how it approaches expensive belongings, it can help to speak to an insurance agent to see what the best solution is for you.

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Common California home insurance problems

California has something to offer for all kinds of homeowners with its buzzing cities, hundreds of miles of coastline, sky-grazing mountain ranges, mild winters and otherworldly desertscapes. While California’s cultural cachet and natural beauty make it a desirable place for many to put down roots, finding the right home insurance policy can be a challenge. Here are a few hurdles homeowners may encounter:

• Dwindling coverage options: In the past year, seven of California’s largest home insurance providers by market share — State Farm, Allstate, Farmers, USAA, Travelers, Nationwide and Chubb — have either stopped accepting new home insurance policies or limited the number of new policies they’re willing to write. Together, these seven insurers wrote more than 34 percent of all home California home insurance policies in 2023, and their departure from the state signals an unstable insurance landscape.
• Difficulties finding a policy: Wildfires can be devastating and lead to some of the most expensive home insurance claims. In 2023, the National Interagency Coordination Center estimated that California lost more than 330,000 acres to wildfires. With that in mind, USAA has tightened its wildfire safety standards to only write policies for homes below a certain risk threshold. While it’s unclear how the new guidelines will affect current policyholders, it certainly doesn’t make it easier for new homeowners to get coverage.
• Strained FAIR plan: The FAIR plan is supported by California’s private home insurers, and if too many homes are on the plan, it could take just one bad wildfire season to wreak havoc. The potential payout required from private insurers in the event of widespread wildfire losses could put them at risk for financial solvency and incentivize them to limit the number of new home insurance policies.
• Natural disasters: California’s natural beauty comes at a steep price. While there’s plenty to enjoy about the great outdoors here, earthquakes, landslides, floods and wildfires pose major threats to homeowners across the state. When shopping for homeowners insurance, California property owners will likely need to consider endorsem*nts or additional policies to be financially protected from Mother Nature’s wrath.

Methodology

Additional profiles:

• Coverage A, Dwelling: $150,000, $350,000, $450,000, $750,000
• Coverage B, Other Structures: $15,000, $35,000, $45,000, &75,000
• Coverage C, Personal Property: $75,000, $175,000, $225,000, $375,000
• Coverage D, Loss of Use: $30,000, $70,000, $90,000, $150,000
• Coverage E, Liability: $500,000
• Coverage F, Medical Payments: $1,000

Bankrate Scores

Our Bankrate Score considers variables our insurance editorial team determined impacts policyholders’ experiences with an insurance company. These rating factors include a robust assessment of each company’s product availability, financial strength ratings, online capabilities and customer and claims support accessibility. Each factor was added to a category, and these categories were weighted in a tiered approach to analyze how companies perform in key customer-impacting categories.

Each category was assigned a metric to determine performance, and the weighted sum adds up to a company’s total Bankrate Score — out of 5 points. Our scoring model provides a comprehensive view, indicating when companies excel across several key areas and highlighting where they fall short.

• Cost & ratings50%

• Coverage & savings30%

• Support20%