Best Home And Auto Insurance Companies In California

California is home to nearly 40 million people, with an estimated 55% of them being homeowners. If you are a current or prospective homeowner in California, finding home insurance may be challenging. The California Association of Realtors' 2023 Annual Housing Market Survey found that nearly 7% of real estate deals in the state fell through because buyers couldn't find affordable insurance.

Some of the best home insurance companies in California include Lemonade, Mercury, AAA, and Travelers.

USAA, Chubb, Nationwide, Travelers and Encompass are some of the best home insurance policies in California

USAA

USAA is a good option for those with military affiliations, as it offers military-focused coverage and has eligibility restrictions in place. It earned the highest J.D. Power score for customer satisfaction and was named the Best Home Insurance Company Overall in the 2024 Bankrate Awards. USAA also has unique options tailored to active-duty military members, such as coverage for uniforms damaged in a covered loss. Their home insurance policies include $5,000 of identity theft protection and replacement cost coverage, and they offer a range of endorsements to further customise your policy. However, USAA does not write earthquake insurance in California.

Chubb

Chubb is a great choice for high-value homes, especially those needing specialty earthquake or flood coverage. They offer custom policy coverage, including for wine, jewelry, and art collections, and provide HomeScan risk-mitigation consulting. Their Masterpiece plan includes extended replacement cost coverage, water backup coverage, replacement value for personal property, identity theft coverage, and other coverages typically offered as endorsements. Chubb also offers equipment breakdown coverage for essential and enhanced home systems and valuable articles insurance for high-value items.

Nationwide

Nationwide stands out for its unique coverage options, such as the Better Roof Replacement option, water backup coverage, and identity theft protection. They can also assist California homeowners in obtaining flood and earthquake insurance. Nationwide offers a wide range of home insurance discounts, contributing to their win in the 2024 Bankrate Award for Best Budget Home Insurance Company. However, they have a lower-than-average J.D. Power customer satisfaction score.

Travelers

Travelers is an excellent option for those living in green homes, as they offer a special discount and coverage for LEED-certified homes. Their standard home insurance policies are simple, but they offer a variety of endorsements to customise your policy, including water backup coverage, identity theft coverage, and higher limits for valuables. Travelers also provide several discounts, such as multi-policy, claims-free, newly purchased home, and protective device discounts. However, they ranked low in the 2023 J.D. Power Home Insurance Study, and online quotes are not available in California.

Encompass

Encompass is ideal for those looking to bundle their home and auto insurance, as they offer a single deductible option for both policies if the loss occurred from the same event. Their policies are highly customisable, with three coverage tiers—Special, Deluxe, and Elite—each offering different coverage options and limits. Encompass also has a superior AM Best financial strength rating. However, they have high average premiums, and you cannot get a quote or file a claim online.

The average cost of home insurance in California is $1,456 per year for $300,000 in dwelling coverage

The cost of home insurance in California is influenced by several factors, including the risk of natural disasters, the cost of construction, the condition of the property, and personal factors such as credit score and claims history. California is a state with a high risk of natural disasters such as wildfires, earthquakes, and floods, which can impact the cost of insurance. The age and construction style of a home can also affect the premium, with newer homes typically being less expensive to insure. The claims history and credit score of the homeowner are also taken into consideration when determining the premium.

To find the best home insurance rate in California, it is recommended to get quotes from several carriers and compare the coverage options, discounts, and premiums offered by different companies. It is also important to review the coverage options carefully to ensure that the policy provides adequate protection against common natural disasters in the state, such as wildfires and earthquakes.

The cheapest home insurance in California is Hippo, with policies averaging $1,020 annually

The cheapest home insurance in California is provided by Hippo, with policies averaging $1,020 annually. This is significantly lower than the state average of $1,361 per year, or $1,456 per year for $300,000 in dwelling coverage.

Hippo is a good option for those seeking a quick and convenient quote process, as it claims to offer an estimate in 60 seconds. You can also add a home monitoring system to your policy, which is beneficial for those living in high-crime areas. Hippo also offers a range of discounts, including for theft protection devices and homeowners associations. However, it does not offer endorsements for natural disasters, which could be a drawback for those in California.

Other affordable options for home insurance in California include:

• Mercury: The average cost of home insurance from Mercury is $971, 40% cheaper than the state average. Mercury also offers earthquake coverage and good discounts, such as for green homes. However, you cannot get a quote online and there have been reports of claim delays.
• AAA: AAA has highly-rated customer service and affordable rates. Two AAA companies sell home insurance in California, with average annual costs of $1,048 in Southern California and $1,163 in Northern California. AAA also offers earthquake, flood and umbrella coverage.

Lemonade offers home insurance in California and has a mobile app with personalized guidance for homeowners

Lemonade's home insurance policies in California offer the standard coverages, including dwelling, personal liability, personal property, loss of use, and medical payments. Additionally, they provide several optional coverages tailored to the needs of California residents, such as earthquake insurance through their partner Palomar, water backup coverage, swimming pool coverage, and buried utility coverage.

The Lemonade app stands out for its user-friendly experience and the ability to personalize your coverage. You can easily adjust your policy, add or remove coverages, and manage your insurance independently. The app also facilitates the claims process, allowing you to file claims and receive approval and compensation quickly, sometimes within seconds.

Lemonade's unique business model sets it apart from traditional insurance companies. They take a flat fee, use the rest to pay claims, and give back any leftover money to charities through their Lemonade Giveback program. This approach aligns with their status as a B-Corp, integrating social good into their business model.

In addition to home insurance, Lemonade offers other types of insurance, including car, pet, and life insurance. You can bundle these policies together to save money and conveniently manage all your insurance needs in one place.

Overall, Lemonade provides a modern, app-based approach to home insurance in California, offering comprehensive coverage, personalized guidance, and a seamless digital experience.

California's FAIR Plan is a last-resort home insurance option for homeowners who have been unsuccessful in the private market

The California FAIR Plan is a last-resort home insurance option for homeowners who have been unsuccessful in the private market. It is a critical insurance option for Californians who are unable to obtain insurance through regular insurance companies. The FAIR Plan was established more than 50 years ago to provide insurance for high-risk properties when traditional insurance companies will not. It is financially supported by local insurance companies, not taxpayers, and offers temporary fire and earthquake insurance for homes and businesses in high-risk areas.

The FAIR Plan is intended to be a temporary solution for homeowners who are unable to obtain coverage in the traditional insurance market. To be eligible for the FAIR Plan, homeowners must meet certain criteria and demonstrate that they have been denied coverage from the private insurance market multiple times. The application process involves finding a licensed insurance broker in the state, who will help to complete the application and determine the appropriate amount of coverage and endorsements. The broker will also calculate the fair market value of the home. Once the application is approved, the homeowner must pay the first month's premium to activate the coverage.

The FAIR Plan provides basic fire insurance coverage and can be modified with endorsements to include other structures, fair rental value, dwelling replacement cost, personal property replacement cost, ordinance/law coverage, vandalism and malicious mischief, debris removal, inflation guard protection, plants and trees, outdoor equipment and signs, and improvements and alterations. Earthquake coverage is not included in the FAIR Plan but can be purchased separately through the California Earthquake Authority.

The FAIR Plan is more limited and expensive than a standard homeowners insurance policy. As of June 2024, the average cost of a FAIR Plan policy was about $3,200 per year, compared to the average homeowner's insurance cost of $2,150 for $300,000 in dwelling coverage. The FAIR Plan covers much less than a typical home insurance policy, and homeowners on the plan usually pay more for less. The cost can be further increased by purchasing additional policies to complement the FAIR Plan, such as a difference in conditions, flood or earthquake policy.

Frequently asked questions