Homeowners (or property) insurance is necessary to protect you from major damages and repair costs which often arise through natural disasters, theft, or accidents and it is required when qualifying for a mortgage loan.
In the past, obtaining a homeowners insurance policy was easy. Unfortunately, that is no longer the case in several states – such as California.
Due to climate change and the resulting wildfires, insurance carriers have stopped writing or renewing current homeowners insurance policies in California, as they currently view California as risky and expensive. Property insurance companies are only allowed to raise premiums by a certain amount each year and the rise in premiums has not been able to keep up with the number of claims to offset costs.
Essentially, the insurance companies are losing money in California and choosing to focus on other states, leaving new and existing homeowners at risk. As a new or existing homeowner, you can protect yourself from this issue by shopping for new quotes at the beginning of the loan process. The cost of insurance is going to increase, especially with fewer providers willing to write comprehensive policies. The approval time for a new quote will likely also be more rigorous and take more time to complete.
If you need a recommendation for a licensed insurance agent who can assist in providing guidance or help answer your questions, please do not hesitate to reach out to our office at (760)930-0569.