California’s Huge Property Insurance Market Hard For Carriers To Ignore

Two of California’s worst wildfires in 2018 cost Allstate Corp. a half-billion dollars, but the insurance conglomerate was able to give investors some reassuring news: It had already shrunk its footprint in California by half, creating a buffer of sorts against future losses.

Earlier this year, however, Allstate told California regulators it planned to expand its homeowners’ coverage throughout the state — taking on new customers for the first time in nearly 15 years.

‘We’ve been there for Californians throughout the wildfires by paying thousands of insurance claims and we extended our coverage offerings this year to help alleviate the homeowners’ insurance availability crisis,’ the company said in a statement to The Sacramento Bee.

After the mega-disasters of 2017 and 2018, insurance carriers dropped tens of thousands of homeowners in the Sierra foothills and other fire-prone areas of California, forcing policyholders into a costly, state-mandated insurance pool.

Customers who were paying, say, $2,000 a year for coverage are now paying twice or three times as much. Now, however, something is stirring in what Allstate once dubbed ‘catastrophe-prone California.’