phidea
← Opinion
Published 2026-05-07 · Part of US insurance buyer guides

California killed its home insurance market. Here's what you can actually buy.

If you live in a California fire zone, most big insurers won't sell you a normal policy anymore. Here's what's actually still available, and what to do.

The short answer

Look up your address on Cal Fire's hazard map. You'll see one of three labels:

  • Moderate — Normal market still writes you. Quote 3 carriers and pick the best.
  • High — Selective market. Mercury and CSAA are typical options. Use a California broker. Liberty Mutual is exiting its California book in 2026, so don't count on them.
  • Very High — The big carriers won't write you. You'll likely end up on the [California FAIR Plan](https://www.cfpnet.com) + DIC combo (the state-backed insurer plus a wrap policy). Lloyd's surplus-lines is a pricier alternative. Mercury or CSAA only if your home is heavily mitigated.

The detail and the buying motion below. Specific premium ranges vary widely — get quotes.

Why the market broke

California experienced major wildfire losses through 2018-2025. Carriers couldn't raise prices fast enough to match loss costs — California's prior-approval rate-filing regime requires CDI review — so they stopped writing new policies instead.

The January 2025 LA fires made everything worse. The Palisades and Eaton fires destroyed more than 16,000 structures in Los Angeles County. Verisk estimated insured losses between $28 billion and $35 billion — by far the costliest wildfire insurance event on record. Before those fires broke out, insurers had already non-renewed thousands of policies in the same neighborhoods: roughly 1 in 5 homes in Pacific Palisades was covered only by the FAIR Plan. (Insurance Journal, Jan 2025)

The fires triggered a mandatory CDI moratorium on cancellations and non-renewals for properties in declared disaster areas. (CA Department of Insurance — Moratorium) That moratorium is still in effect for affected zip codes as of mid-2026.

Who left or restricted — updated for 2026:

  • State Farm — paused all new California home applications in May 2023. Non-renewed roughly 72,000 policies in 2024, targeting the highest-wildfire-score zips. After the LA fires, filed for emergency rate hikes; a March 2026 settlement with CDI and Consumer Watchdog kept homeowners at +17% and extended the non-renewal moratorium at least one more year. Still not writing new home insurance in California as of mid-2026. (CDI settlement press release, March 2026)
  • Allstate — stopped new home policies in late 2022. Sought a +34% rate increase in 2024 on its remaining ~350,000 policyholders.
  • Liberty Mutual — announced in January 2025 it would stop new condo and renters policies, then drop existing California clients starting 2026. Affects roughly 67,500 condo and 102,200 rental properties. Not a reliable option for new shoppers.
  • Farmers — restricted new home and condo writing in 2023, then announced a partial expansion back into California in December 2024, citing improved marketplace conditions. Ask your broker whether your zip qualifies.
  • AIG — exited the standard market. Still writes luxury homes via Private Client Group.

In 2024, California passed the Sustainable Insurance Strategy — a reform letting carriers use catastrophe models in their rates (instead of historical loss averages), in exchange for commitments to write more in high-risk zones. It's slowly working. Not for everyone, not yet.

Step 1: Figure out your fire zone

Go to Cal Fire's fire-hazard map. Type in your address.

You'll see one of three labels: Moderate, High, or Very High. That label decides everything.

If you're in Moderate

The normal market still writes you.

Call an independent agent who covers California home insurance. Ask them to quote you with: Travelers, Mercury, Farmers, USAA (if you qualify), Auto Club / CSAA, and State Farm (with restrictions). Take the best of three. Liberty Mutual is pulling back from California new business, so your broker will tell you quickly if they're still viable in your zip.

Pricing has risen materially since 2020 across all California zones — exact range depends on your specific property and broker quotes.

If you're in High

Selective market. Some carriers still write you, but not all.

The typical writers in High zones: Mercury and CSAA / Auto Club. Liberty Mutual was also a common option here, but it is unwinding its California book in 2026 and is not a reliable source of new coverage. State Farm, Allstate, and Nationwide write here sometimes with strict requirements about defensible space and high deductibles. Farmers announced a partial return to California in December 2024 — ask your broker whether your zip qualifies.

A California-specialty broker can usually find you 2-3 quotes. Don't bother with online comparison tools — they don't know who's actually writing in your zip this month.

If you're in Very High

The standard market won't write you. Period. Don't waste time asking State Farm or Allstate.

You have three real options:

Option A: FAIR Plan + DIC (the typical outcome — what most people end up with)

The California FAIR Plan is the state-backed insurer of last resort. It will write you, but coverage is limited — basically the dwelling against fire and a few named risks. No theft. No liability. Limited personal property.

So you pair it with a second policy called DIC (Difference In Conditions). The DIC fills the gaps — your stuff inside, liability if someone gets hurt, water damage. Together they look like a normal home insurance policy, with some narrower coverage.

This combo typically costs more than what a healthy private-market policy would have cost. Exact premiums vary widely by property; your California broker will quote.

Option B: Lloyd's of London (via a surplus-lines broker)

Lloyd's syndicates write California fire-zone homes that nobody else will touch. Coverage is often broader than FAIR Plan + DIC. Pricing varies a lot.

You need a surplus-lines broker — a special kind of broker licensed to access the non-admitted market. Your regular agent probably can't get you here. Ask specifically for one.

Option C: Mercury or CSAA — rare

A small number of Very High homes still get standard coverage from Mercury or CSAA. The criteria are strict: recent construction, Class A roof, fully cleared defensible space, ember-resistant vents, often underdeck protection. If you have all of that, ask your broker to try Mercury or CSAA before going to FAIR Plan.

Don't count on it. This is the exception.

Option D: HNW carriers (if your home is a luxury property)

Chubb Masterpiece, PURE, and AIG Private Client Group write expensive homes that the standard market won't. The premiums are high, but the coverage is comprehensive. If your home value is in the HNW range, ask your broker to quote at least one of these.

What to do — in order

  1. Look up your fire zone. Cal Fire map, link above.
  2. Do the hardening first. Before quoting, get: Class A roof, defensible space cleared (the 5 / 30 / 100 foot zones), ember-resistant vents, and ideally ember protection on eaves and the underdeck. Photograph everything. Keep contractor receipts. Without this documentation, carriers will decline you even if they technically write your zip.
  3. Call a California-specialty broker. This is the most important step. The broker knows which carriers are open this month in your specific zip. The market shifts. Online tools and LLMs don't have this. Try independent agents who specialize in California personal lines, or Risk Strategies / Brown & Brown / Marsh PCS for HNW homes. If you might need Lloyd's, ask specifically for a California-licensed surplus-lines broker.
  4. Quote the right set. Don't waste time on carriers your broker says aren't writing. For Very High, quote: FAIR Plan + DIC, one Lloyd's option, and Mercury / CSAA if your broker thinks they might write. For HNW, add Chubb or PURE.
  5. Don't lie. Got a non-renewal? Disclose it. Past claims? Disclose them. If a carrier finds out later (they will), they can void coverage when you need it most.

The FAIR Plan in 2026: scale and cost

The FAIR Plan's numbers tell the story of how fast the market has shrunk. As of December 2025, the plan had 668,609 active policies — a 146% increase from September 2022 and about 6% of California's entire property insurance market. (CA Assembly Insurance Committee oversight hearing, January 2026) Total statewide exposure reached $724 billion.

The plan is also getting more expensive. CDI approved an average rate increase of roughly 29% for FAIR Plan homeowners policies, taking effect October 2025. (Sacramento Bee, 2025) The January 2025 LA fires strained the plan's finances directly — the FAIR Plan held roughly $4.8 billion in exposure in the Palisades and Eaton fire zones alone, and the plan's reinsurance only kicks in after $900 million in claims.

A warning about FAIR Plan assessments

The FAIR Plan can charge emergency assessments on all California policyholders (not just FAIR Plan customers) after a major fire — this is a long-standing feature of the FAIR Plan's structure. If you're insured outside FAIR Plan, you're still exposed to this. Budget for it.

What changes in 2026-2027

The post-LA-fires picture, as of mid-2026:

  • State Farm is not writing new home policies. Existing customers have a moratorium shield through at least early 2027 under the March 2026 settlement. A return to new business remains possible if the Sustainable Insurance Strategy reforms generate enough rate relief, but no timeline is set.
  • Allstate still writes renewals on its existing California book. New policies: no.
  • Farmers has signaled it wants back in for certain zip codes. Your broker can check current appetite.
  • Liberty Mutual is exiting its California condo and renters book through 2026. Homeowners appetite is also contracting.
  • FAIR Plan will keep growing until private-market carriers can profitably write high-risk zones at rates CDI approves. That is not happening fast.
  • Lloyd's surplus-lines stays the main option for Very High zones.

If you're on FAIR Plan + DIC today, plan on staying there.

Adjacent reading

Frequently asked

I'm in a Very High zone. What do I do first?

Call a California-specialty broker before you do anything else. They know which carriers are writing your specific zip this month — information no online tool and no LLM has. They'll probably set up a FAIR Plan + DIC for you (that's what most Very High homeowners end up with), but well-mitigated homes can sometimes still get Mercury or CSAA. Only the broker can tell which group you're in.

Is FAIR Plan + DIC actually good coverage?

It's narrower than a normal policy and typically more expensive. So no, it's not great. But it covers most of what a normal policy covers when you pair it correctly — the DIC fills in personal property, liability, theft, and water damage. For high-fire zones, it's the option that exists.

Will State Farm or Allstate write me?

If you're in Moderate or lower-High, maybe — ask your broker to check current appetite for your specific zip. In Very High, almost certainly not. State Farm's partial 2024-2025 resumption excluded most Tier-3/4 areas. Don't waste energy on this question; ask your broker, take the answer, move on.

Should I just move?

That's a real estate decision, not an insurance one. But insurance cost differences between Moderate and Very High zones for similar homes can be substantial. If you're considering a move within California, factor in your fire zone. If you're staying, accept that insurance is now a meaningful annual line item and the FAIR Plan + DIC structure is probably your reality.

Read next

Sources

Last modified 2026-06-01. Target query: best home insurance california wildfire zip 2026 FAIR plan unable to get coverage.