The year 2023 has brought significant shifts in the landscape of the insurance industry, particularly in California. From major carriers exiting the state to the impact of natural disasters, the insurance market is experiencing transformations that are reshaping the way Californians secure their homes and assets. Here’s what you need to know about the state of insurance in 2023, according to our San Pedro insurance agency:

Insurance Carriers Pulling Out of California

One of the most notable trends in 2023 is the departure of major insurance carriers from California. Household names like State Farm, Allstate and AIG have made the difficult decision to pull out of the state due to various reasons such as regulatory challenges, increased risks from natural disasters and changing market dynamics. This shift has left homeowners and policyholders to reconsider their insurance options, leading to a more competitive landscape where local and specialized insurers are stepping up to fill the void.

Coping with Natural Disasters 

California is no stranger to natural disasters, with wildfires and floods posing recurring threats to homes and communities. In 2023, the focus on wildfire mitigation has intensified, with homeowners and authorities taking proactive steps to reduce risks. From clearing defensible spaces around properties to using fire-resistant building materials, individuals are actively participating in safeguarding their homes against the threat of wildfires. Residents should also always be prepared with earthquake insurance. 

Contact us to talk to speak to an expert at our San Pedro insurance agency. 

Guidance from the Department of Insurance

Recognizing the urgency of addressing natural disaster risks, the California Department of Insurance has been actively providing guidance to homeowners. Their initiatives include educating homeowners about the importance of adequate coverage, encouraging them to document their belongings and emphasizing the significance of understanding policy terms and conditions. The department’s efforts are empowering Californians to take informed steps toward protecting their homes and possessions.

Rate Increases for Home Insurance Premiums

California’s rates are currently below the national average. However, insurance companies are increasingly submitting rate increase requests in the double digits. If these increases are approved, it could lead to a more competitive market as carriers would be inclined to underwrite new business, provided they can accurately assess the risks. A leading carrier recently applied for a 29% hike in homeowners’ rates, signaling a potential trend. With more carriers following suit, it’s likely that double-digit rate hikes will become more prevalent and approved in the coming year.

Work with Our San Pedro Insurance Agency 

The state of insurance in California in 2023 is characterized by both challenges and opportunities. As Californians continue to adapt to the consequences of climate change, the insurance industry is evolving to ensure that residents have access to the coverage and resources they need to secure their homes and futures— like flood, fire and earthquake insurance. 

If you’re not sure how to access affordable, comprehensive insurance coverage, contact NHC Insurance Services and we’ll help you get started.