California’s property insurance market has been reeling after a series of devastating and costly wildfires over the last decade, with estimated losses of more than $35.8 billion. Insurers have argued that outdated voter-approved regulations enacted in the late 1980s aimed at ensuring fairer rates have left them unable to charge enough to reflect rising costs and risk, forcing them to limit their liability exposure or leave the California market altogether.
The impact is broad. Statewide, California has had nearly 7.6 million non-renewals. The state’s hardest hit ZIP code was 92592 in the Riverside County city of Temecula, with 26,918 non-renewals. Marin County as a whole had 49,782 non-renewals from 2015 to 2024, according to the data.
A random sampling of Marin ZIP codes includes 94941 in Mill Valley, which had 6,714 non-renewals out of 87,127 policies; 94924 in the Bolinas area, 399 out of 5,315; 94960 in San Anselmo, 3,631 out of 46,863; 94945 in Novato, 3,583 out of 47,071; 94956 in Point Reyes Station, 302 out of 3,858; and 94901 in San Rafael, 6,190 out of 79,096.
In Marin, Scott Johnson, the founding insurance broker of Marindependent Insurance Services, said his phone has been ringing off the hook with people who have been dropped by their insurer. “People are getting non-renewed left and right,” Johnson said. “It’s a problem.”
While non-renewing home insurance policies has been an issue for a while, Johnson said some insurers have upped the ante — like taking drone or satellite pictures of homes — and even canceling line items in the insurance.
“They’ll issue a non-renewal for the silliest reason — you have moss on the roof,” Johnson said. “It really requires action on the part of the consumer to keep the policy.”
Assemblymember Damon Connolly is making a second attempt to pass a bill that seeks to reduce home insurance costs through wildfire safeguards. The bill’s previous version, AB 2416, stalled and did not make it to a final Senate floor vote in August. This month, Connolly reintroduced the bill as AB 1 with the co-authorship of Assembly Speaker Robert Rivas. “I plan on getting this version of the bill or, if needed, a stronger version through the Legislature with bipartisan support this year, passed and signed into law by the governor in the new year,” he said.
Spurred by Gov. Gavin Newsom, the state’s elected insurance commissioner, Ricardo Lara, presented a plan last fall to adopt new regulations by the end of this year addressing insurers’ chief demands: faster rate hike approvals; rates based on risk modeling rather than historic losses; and the ability to pass along to consumers their own costs for reinsurance against catastrophic losses. In return, Lara pledged that insurers would have to offer more coverage in the state’s fire-risk areas.
Those efforts are nearing completion, and relief is on the way with insurers such as Allstate and Farmers announcing plans to expand coverage in the state as reforms are implemented, said Michael Soller, a spokesman for the insurance department.
“All of the changes Commissioner Lara announced late last year are going to be in effect and finalized by the end of this month,” Soller said. “The risk of wildfires has increased, but under our 30-year-old rules, insurance companies are increasing the costs but not writing more policies. We’re updating rules so that insurance companies actually have to write more policies. And for the very first time in California’s history, that will happen.”
But insurers have cautioned that it could take years for changes to be reflected in coverage, and consumer advocates have questioned whether the new rules will deliver more than just higher premiums.