California Home Insurance 2017: Rates, Complaints and Earthquakes

Homeowners Insurance, Insurance

California ranks No. 26 out of all states for home insurance premiums. (The most expensive average rates are in Florida.) The California department of insurance is in charge of licensing home insurers and approving their rates.

Average home insurance rates in California

Amount of insuranceAverage annual rate in CaliforniaAverage annual rate nationwide
Rates are based the the cost of an HO-3 policy. Data used with permission from the National Association of Insurance Commissioners.
$49,999 and under$343$371
$50,000 to $74,999$388$715
$75,000 to $99,999$448$780
$100,000 to $124,999$494$809
$125,000 to $149,999$540$840
$150,000 to $174,999$581$874
$175,000 to $199,999$623$914
$200,000 to $299,999$723$1,016
$300,000 to $399,999$878$1,205
$400,000 to $499,999$1,065$1,442
$500,000 and over$1,701$2,147

Types of policies

HO-1: A basic homeowners policy that has been discontinued in most states.

HO-2: Homeowners policy broad form. This policy type covers damage from 16 perils:
1. Fire or lightning
2. Smoke
3. Theft
4. Vandalism
5. Windstorms and hail
6. Damage caused by vehicles
7. Damage from aircraft
8. Weight of ice, snow and sleet
9. Freezing of household systems
10. Riots
11. Explosions
12. Falling objects
13. Volcanic eruptions
14. Overflow or discharge of water
15. Damage from artificially generated electrical current
16. Sudden tearing, cracking or bulging of home

HO-3: Homeowners “open-peril” policies that cover all risks to your dwelling except those your insurer excludes. Your personal property, however, is still covered under a named-peril basis.

HO-5: Homeowners comprehensive policy. Covers your dwelling and personal property for all risks except those specifically excluded.

About home insurance amounts

When you buy home insurance, the amount to cover your dwelling should be based on the cost to reconstruct the house. This is not the same as the real estate market value of the house if you were to sell it. The reconstruction cost could be more or less than the real estate value of the home, depending on where you live. Don’t include land value in the insurance coverage amount.

Largest home insurers in California and market share

1. State Farm: 20%.

2. Fire Insurance Exchange (part of Farmers): 8%.

3. Allstate: 7%.

4. CSAA: 6.7%.

5. Interinsurance Exchange of the Automobile Club: 5.9%.

Best and worst home insurance companies in California based on consumer complaints

Best home insurance companies in California
Source: California Department of Insurance, based on 2015 complaint data.
California Capital Insurance
Farmers Insurance Exchange
Safeco Insurance Co. of Illinois
Integon National Insurance
Neighborhood Spirit
Trumbull Insurance
Worst home insurance companies in California
Source: California department of insurance, based on 2015 complaint data.
Hartford Underwriters
Homesite Insurance
IDS
Encompass Insurance
Pacific Specialty
First National Insurance

Earthquake insurance in California

If you have home insurance in California, your home insurance company must also offer to sell you earthquake insurance. Most earthquake policies come from the California Earthquake Authority. It notes that most Californians live within 30 miles of an active fault. The CEA’s policies are sold only through participating insurers.

Earthquake probability in California

The map below shows the probability of a 6.7-magnitude or greater earthquake striking in California within the next 30 years. (Orange and red areas have greater probability.)

ucerf3-fig01_partprobsm6pt7_hires

Greater California earthquake probability

Earthquake magnitude (greater than or equal to)30-year likelihood of one or more quakes
5
100%
6
100%
6.7
>99%
7
93%
7.5
48%
8
7%
Source: USGS Uniform California Earthquake Rupture Forecast

San Francisco earthquake probability

Earthquake magnitude (greater than or equal to)30-year likelihood of one or more quakes
5
100%
6
98%
6.7
72%
7
51%
7.5
20%
8
4%
Source: USGS Uniform California Earthquake Rupture Forecast

Los Angeles earthquake probability

Earthquake magnitude (greater than or equal to)30-year likelihood of one or more quakes
5
100%
6
96%
6.7
60%
7
46%
7.5
31%
8
7%
Source: USGS Uniform California Earthquake Rupture Forecast
Earthquake magnitudeIntensity
Source: U.S. Geological Survey
1.0 - 2.9Very mild, often unnoticeable.
3.0 - 3.9Perceptible shaking, especially if indoors.
4.0 - 4.9Felt both indoors and outside, minor damage (broken dishes, windows, etc).
5.0 - 5.9Intense shaking, mild to moderate damage.
6.0 - 6.9Moderate to severe damage. Buildings shift off their foundations.
7.0 and higherDevastating effects, leveling most structures.