Daily Property & Casualty Insurance News
California Edition

California’s Department of Insurance has approved a 15% average rate increase for auto policies from State Farm and Allstate due to escalating repair costs and liability claims. The approval affects over 2 million policyholders and marks the second consecutive year of double-digit increases.

Farmers, Liberty Mutual, and USAA have announced non-renewals for 45,000 home policies in California’s wildfire-prone areas, citing unsustainable losses from recent fire seasons. The move pushes more homeowners toward the state-backed FAIR Plan, now serving over 1.2 million policies.

Global reinsurers are set to cut capacity by 25% for California property risks at the upcoming renewals, driven by $12 billion in catastrophe losses over the past two years. Primary carriers warn this will force significant rate hardening and coverage restrictions.

Governor Newsom signed AB-1234 requiring insurers to disclose AI usage in auto insurance underwriting and provide consumers with algorithmic decision explanations. The law aims to prevent discrimination and takes effect January 1, 2027 for all P&C lines.

A 6.2 magnitude earthquake near Los Angeles has resulted in $3.2 billion in preliminary P&C insurance losses, primarily from property damage and business interruption claims. Early data shows residential claims dominating at 62% of total exposure.