A recent state filing by State Farm showed it is dropping 72,000 insurance policies in California, including 30,000 property insurance and 42,000 apartment policies.
State Farm, the largest insurer in California, last month announced its decision to drop policyholders in the state, citing inflation and catastrophe exposure as some of the reasons for the move.
"This decision was not made lightly and only after careful analysis of State Farm General's financial health, which continues to be impacted by inflation, catastrophe exposure, reinsurance costs, and the limitations of working within decades-old insurance regulations," the company said in a press release. "State Farm General takes seriously our responsibility to maintain adequate claims-paying capacity for our customers and to comply with applicable financial solvency laws. It is necessary to take these actions now."
Now, recent filings with the California Department of Insurance show where State Farm's nonrenewals will be concentrated, as first reported by KTLA5.
California Zip Codes Where State Farm Will Not Renew Policies
The zip code with the most affected policies was 94563 (Orinda), where 1,703 policies will not be renewed. This represents 55% of the city's homeowner policies. That marks the highest number of nonrenewals for one ZIP code in the state.
Other zip codes most affected by State Farm's nonrenewals include 90272 Pacific Palisades, 90049 Brentwood, 91302 Calabasas, 94549 Lafayette, 95409 and 95404 Santa Rosa, 90210 Beverly Hills, 90077 Bel Air, 92067 Rancho Santa Fe, and 95949 Grass Valley.
The nonrenewals will begin during the summer. It will represent just over 2% of the company's total number of policies in California.
State Farm is not the only insurer that announced plans to drop policies in California. The Hartford Financial Services Group, better known as The Hartford, in late January, announced it would no longer offer new home insurance policies in the state due to "unique challenges."
Allstate, the fourth-largest property and casualty insurance provider in California, also stopped selling new insurance home, condominium, and commercial insurance policies to residents in the state.
"The cost to insure new home customers in California is far higher than the price they would pay for policies due to wildfires, higher costs for repairing homes, and higher reinsurance premiums." Allstate said in a statement.
Additionally, American International Group, Chubb, and Farmer's Insurance have scaled back on the number of insurance policies they are issuing in California.
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