The Best Homeowners Insurance in California

Earthquakes. Wildfires. Floods. California has its share of natural disasters, but one thing it doesn’t have? High homeowners insurance premiums.

At $1,224 per year, California’s average home insurance premium is less than the national average of $1,585, putting it in the middle of the pack compared to the rest of the U.S.

To insure a home in California, you’ll need to consider several of the state’s unique environmental risks, such as wildfires and earthquakes. These factors substantially impact how much you’ll pay for homeowners insurance.

NerdWallet analyzed rate and policy information from 26 companies to determine the best insurance options for California homeowners.

Best homeowners insurance companies in California

These companies sell homeowners insurance in California and are on NerdWallet's list of the Best Homeowners Insurance Companies:

Here's a little bit more about the top insurers:

Chubb

Although Chubb is one of the most expensive insurers in the state, its standard policy includes coverage options for which others often charge extra. For example, homeowners who buy Chubb's Masterpiece policy can receive the full amount it costs to replace damaged or destroyed personal items rather than the items' depreciated value.

Nationwide

Like Chubb, Nationwide offers several features in its standard policy that many other companies do not. For example, if a part of your home is damaged or destroyed and you discover it needs to be brought up to current building codes during repairs, Nationwide may pay for the required upgrades (up to 10% of your total dwelling coverage).

USAA

If you're an active military member or a veteran, or are a family member of one, USAA offers several benefits that normally cost extra from other insurers. Identity theft coverage and replacement cost for damaged or stolen personal items are just two of the benefits available to policyholders in most states.

Travelers

Although Travelers is the cheapest option in California, its standard policy does not come with some of the coverage options provided by other insurers. Travelers does, however, offer unique add-ons such as green home coverage that can help cover the cost of using sustainable materials to rebuild or repair your home.

How much is homeowners insurance in California?

The average cost of homeowners insurance in the state of California is $1,224 per year, according to a NerdWallet analysis. However, considering California's size, your rate could vary a lot depending on where you live. The difference between the most and least expensive areas in California is over $650 per year.

» MORE: What’s the average cost of home insurance?

However, living in one of California's largest metropolitan areas doesn’t necessarily mean you'll pay much more than the average rate. In some areas, you may even pay less.

Here are the average rates for the five largest metro areas in the state, according to the U.S. Census Bureau:

Biggest insurance companies in California

If you're looking for coverage from a company with a significant presence in California, these insurers have the largest market share in the state according to the most recent data from the National Association of Insurance Commissioners:

• State Farm.

• Farmers.

• Liberty Mutual.

• CSAA.

• Allstate.

• USAA*.

• Auto Club of SoCal.

• Mercury.

• Nationwide.

• Travelers.

*USAA homeowners insurance is available only to active military, veterans and their families.

And this is how those insurers' average annual premiums stack up (note that Liberty Mutual's rate information was not available, so it is not included in the analysis):

Cheapest home insurance in California

California homeowners have many options for cheap homeowners insurance. In fact, 14 of the 26 analyzed companies offered premiums that overall were cheaper than the state average of $1,224. Those insurers were:

» MORE: Get the best cheap homeowners insurance

California home insurance factors

Homeowners in California face unique circumstances that factor into decisions about home insurance.

Wildfires

California wildfires have caused billions of dollars of damage to homes and other buildings across the state over the past few years.

Most homeowners policies cover fire and smoke damage, but insurers may be reluctant to cover those in high-risk areas. California’s insurance commissioner has issued several moratoriums to keep insurers from dropping the policies of homeowners affected by recent fires. But once those moratoriums expire, you could find yourself scrambling for coverage.

If you have trouble finding a policy, you can turn to the California FAIR Plan, the state’s insurer of last resort. FAIR Plan coverage is currently limited, paying only for damage due to fire, lightning, smoke and internal explosions.

The insurance commissioner recently ordered the FAIR Plan to offer more comprehensive coverage, similar to a traditional homeowners policy. In the meantime, a “difference in conditions” policy can help fill the coverage gaps.

Earthquakes

A standard home insurance policy doesn’t cover earthquake damage, so California residents should consider adding a separate earthquake insurance policy. Homeowners can get it through a private insurer or turn to the California Earthquake Authority for coverage.

Flooding

California is particularly prone to flooding throughout the state, and homeowners insurance won’t cover flood damage. To make sure costs related to flooding are covered, homeowners in California can purchase flood insurance from the National Flood Insurance Program or a private insurer.

Looking for additional insurance in California?