Despite rate hikes, study finds California home insurance costs are middle of the pack nationwide

"In 2023, California's median home insurance cost of about $1,200 a year ranked in the middle among all states, according to an analysis of U.S. Census Bureau data by UC Berkeley's Terner Center for Housing Innovation. Current data from personal finance sites show a similar comparison. The states with the most expensive insurance are prone to hurricanes or tornadoes, including Florida ($1,887 a year), Louisiana ($1,793), Oklahoma ($1,793), Colorado ($1,769), and Texas ($1,769)."

"The report found that in California, homeowners typically spend about 1% of their income on home insurance. But households in the bottom quartile those earning less than $66,000 a year pay around 3% of their income on average. It may surprise people that as recently as a couple of years ago, California's median home insurance costs ranked in the middle of states across the country, Zack Subin, co-author of the analysis, said in a statement."

"Even as devastating wildfires drive up home insurance costs across California, premiums overall remain relatively low compared to many other states, a new UC Berkeley report finds. But that could change as state regulators phase in new reforms allowing insurers to set rates based on the growing threat of climate change. In recent years, homeowners across the state have been hit with double-digit rate increases as insurance companies have scaled back coverage, in some cases refusing to write new policies anywhere in California."

California's median home insurance cost is about $1,200 per year, ranking in the middle among U.S. states. The most expensive states face hurricane or tornado risk, including Florida, Louisiana, Oklahoma, Colorado, and Texas. Homeowners in California typically spend about 1% of their income on insurance, while households in the bottom quartile (those earning less than $66,000 a year) pay around 3% on average. Wildfire-driven losses have prompted double-digit rate increases and insurers scaling back or refusing coverage. State regulators are phasing reforms to let insurers set rates based on climate risk, risking greater affordability challenges and displacement for vulnerable homeowners.

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