Insurance giant State Farm to stop insuring
new homes in California, citing catastrophic
wildfires and rapidly rising inflation
costs that have put polices at a premium
Daily Mail (UK),
by
Harriet Alexander
Original Article
Posted By: Imright,
5/27/2023 2:19:09 AM
America's biggest home insurance company has announced it will no longer insure houses in California, saying that the risk from wildfires was too great and the cost of rebuilding too high.
State Farm, the nation's biggest car and home insurer by premium volume, said existing customers would not be affected.
But from Saturday, no new home insurance policies will be issued. The company will continue offering auto insurance.
Reply 1 - Posted by:
Highlander 5/27/2023 2:46:05 AM (No. 1478427)
All of California? There’s plenty of land without wildfire danger like the Coachella Valley. Whatever.
8 people like this.
Reply 2 - Posted by:
Jesuslover54 5/27/2023 7:15:56 AM (No. 1478492)
Look, it's a business that quantifies risk, and CA is outside the parameters.
11 people like this.
Reply 3 - Posted by:
chance_232 5/27/2023 7:46:08 AM (No. 1478506)
RE#1. Its not just the wildfires. Its the rebuilding costs. California rightfully requires that new construction meet its current building codes. Any home older than the Newsom administration doesn't come close. Primarily in energy efficiency, insulation, solar panels etc etc. Plus all of the new fees, permits and taxes. If your house is 50 years old, is valued at 500K, it will cost 750K to replace it.
With inflation going thru the roof, I contacted my insurance company to increase my homeowners policy, for the above reasons.
Its cheaper to buy an existing older home than to build the exact same Floorplan to meet current codes.
20 people like this.
Reply 4 - Posted by:
reefdiver 5/27/2023 9:02:02 AM (No. 1478573)
What is the cost for insuring a new tent in California?
9 people like this.
Reply 5 - Posted by:
nwcudagal 5/27/2023 9:15:11 AM (No. 1478583)
In the last 40+ years I've had to switch insurance coverage at least three times because of skyrocketing costs caused by the CA fires. (According to my agent)
7 people like this.
Reply 6 - Posted by:
gop_guys 5/27/2023 9:44:40 AM (No. 1478605)
Funny #4. Truth is; those tents actually cost the California taxpayers billions. Played Pebble Beach last Summer. It was like a slice of heaven. Triple digit heat back home in Texas. High for 3 days was 79. The Pacific Ocean crashed & roared. The towering tress, the tropical plants and flowers were all majestic. Liberalism is a disease and ruins every natural thing of beauty.
9 people like this.
Reply 7 - Posted by:
Pegmo 5/27/2023 10:42:54 AM (No. 1478649)
No worries...they will just have the taxpayers underwrite all homes and real-estate.
3 people like this.
Reply 8 - Posted by:
DVC 5/27/2023 10:45:30 AM (No. 1478653)
This is a good sign how literally untenable California Dems have made the state.
8 people like this.
Reply 9 - Posted by:
Alecto2 5/27/2023 10:56:42 AM (No. 1478667)
#3 "California rightfully requires that new construction meet its current building codes." In the words of the immortal bard John McEnroe: "You cannot be serious!" No consideration that the codes maybe a tad restrictive/impossible maybe?
8 people like this.
Reply 10 - Posted by:
zephyrgirl 5/27/2023 11:31:16 AM (No. 1478698)
I suspect the California Department of Insurance plays a role as well. CA being firmly controlled by liberals, they've been putting restrictions on insurance companies' ability to charge premiums commensurate with the risk of casualties. Looks like State Farm finally said, "Enough!"
9 people like this.
Reply 11 - Posted by:
Vaquero45 5/27/2023 11:39:52 AM (No. 1478702)
It’s simple risk management. Insuring new houses in California is a losing proposition.
This isn’t SF’s first rodeo. Back in the early 90’s, when California was flirting with Proposition 103, they were ready to leave California if it became necessary. When Charlie Crist was governor of Florida and wouldn’t let them have a rate increase (which they needed due to hurricanes and Florida’s ridiculous Personal Injury Protection coverage) they told Crist “we’re outta here” and they started getting ready after Crist’s reply was “well, go ahead!” My claim office in Colorado was making room for three Florida claim reps when Crist backed down just short of the date SF gave him.
Newsom will have do something if Allstate does what The Farm did. He can’t start a financial battle with a company that has $120 billion in reserves...
6 people like this.
Reply 12 - Posted by:
JHHolliday 5/27/2023 12:27:11 PM (No. 1478732)
As a retired insurance agent, I was wondering when this would happen. I am in Georgia but many years ago, one of the companies we represented pulled of CA. The CEO told me that over his fifty years in the business he had made plenty of mistakes but leaving CA was not one of them.
You can toss in the fact that the EVs that Newsom wants tend to be fire hazards and even a minor accident will cause the insurance company to total the vehicle.
Look for CA to come under extreme pressure from both the state and Biden Administration try to force them to stay.
5 people like this.
Reply 13 - Posted by:
Zeek Wolfe 5/27/2023 1:03:29 PM (No. 1478760)
So, you own a house in a California subdivision far distant from any forest with a fire hydrant in front, State Farm won't write a policy? This is the direct result of forest mismanagement by environmental wackos causing huge fires.
5 people like this.
Reply 14 - Posted by:
DanvilleBill 5/27/2023 3:10:12 PM (No. 1478821)
Pebble is a nice golf layout #6 but the $600 green fees and $50 cart fees are a bit rich for my blood.
1 person likes this.
Reply 15 - Posted by:
Faithfully 5/27/2023 10:58:59 PM (No. 1479076)
Risk and reward. That is what insurance is all about.
0 people like this.
Reply 16 - Posted by:
homefry 5/28/2023 8:22:07 AM (No. 1479237)
kalifornia is not a good risk. Look for this to happen in other dim-0 utopias.
0 people like this.
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