California Residents Are at Risk of Losing Their Home Insurance

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May 30, 2023, 11:23 ET

TAMPA, Fla., May 30, 2023 /PRNewswire/ -- Wildfires have always been a risk in California. But the past decade of extremely devastating and widespread fires has led to California insurers canceling homeowner policies by the hundreds of thousands. By 2019, over 348,000 home insurance policies had been dropped, and the state stepped in to help protect homeowners.

Even with new laws written to protect homeowners from losing insurance, California residents in high-risk areas need to know the steps to avoid being without insurance coverage.

Clearsurance.com lists four steps California residents can take to ensure they remain insured.

Step #1 – Get Quotes from California Home Insurance Companies

The most competitive rates can be found by completing a quote search. Even a homeowner who finds out their insurer will drop coverage soon may be able to find a policy from another company.

Insurance providers calculate risk using different formulas, so the first step for homeowners at risk of being dropped by their insurers is to compare quotes from other companies.

Step #2 – Talk to Neighbors to Find Out Who They Use

Neighbors typically have similarities in their risk profiles. So homeowners may be able to find an insurance company that will insure their higher risk by purchasing a policy from the company that insures their neighbor.

An added benefit to talking to neighbors is learning first-hand information about customer service and claims handling.

Step #3 – Call the California Department of Insurance

In response to the devastating fires of the past few years, California's Insurance Commissioner banned insurance providers from dropping policies for residents in regions around the most widespread fires of 2022.

This law temporarily ensures homeowners most at risk have coverage for a year. Melanie Musson, a nationally recognized home insurance expert with Clearsurance.com, urges homeowners to learn their rights. "Homeowners who believe their insurer is dropping them unlawfully should contact the California Department of Insurance and file a complaint."

Step #4 – Consider Home Insurance With the California FAIR Plan

Homeowners who have exhausted other avenues of obtaining home insurance can purchase a limited plan for high-risk homeowners under California's FAIR Plan. These plans cost more than insurance from the competitive marketplace, but they may be the only available insurance policy for some.

Read Clearsurance.com's full report here: What to Do if Your California Home Insurance Cancels You.

SOURCE Clearsurance.com