Insurance companies halt new policies in California due to wildfire risk and rising costs
Insurance giants State Farm and Allstate have announced that they will no longer write new policies in California due to increasing wildfire risk and soaring construction costs. State Farm cited historic increases in construction costs, growing catastrophe exposure, and a challenging reinsurance market as reasons for the decision. Allstate stated that the cost to insure new homes in California is far higher than the price customers would pay due to wildfires and higher reinsurance premiums. This trend reflects the broader issue of insurance companies raising rates, limiting coverage, or pulling out of regions vulnerable to climate change and natural disasters.