Homeowners Insurance in California

What factors influence my home insurance rate?

According to the most recent data, the average CA homeowner pays around $1,782 for insurance coverage each year. But that number accounts for all property owners statewide, so you may still be asking, “How much is homeowners insurance in California for me?”

There are many factors that influence your homeowners insurance rates. The more risk you and your home pose to a carrier, the greater your premiums will be. For this reason, your CA home insurance premiums may vary according to your:

• Location
• Home size
• Home features
• Insured value
• Coverage limits
• Type of homeowner’s insurance coverage
• Deductible chosen
• Eligible discounts
• Claims history
• Home’s age and any relevant safety features
• Added risk factors, such as a pool or trampoline
• Endorsements (additional coverage options) added to the policy

The bigger and more expensive your home, the more you might expect to pay for comprehensive coverage. If you want a policy that protects against most perils, you’ll likely see higher premiums than if you choose a policy with more limited dwelling protection. And if you have a recent history of filing homeowners insurance claims, you may find that carriers will charge more for your coverage than if you didn’t have any newer claims. To see what you'd pay for home insurance in San Diego or Sacramento, check out our guides.

When shopping for homeowners insurance in California, though, there are also additional factors to note which may influence your premiums. While these may each be a concern for residents in other states, California residents may find that many (if not all) of these risks can affect the insurance buying process.

• Wildfires. California averages more than 4,000 wildfires each year, many of those spreading and causing catastrophic damage. When you live in an area prone to wildfires — particularly those that spread and result in home losses, injuries, and deaths — you can expect insurance carriers to charge more for that level of risk. Some companies have stopped writing new policies and even non-renewed existing policies over the added risk that these catastrophes pose. (Depending on your area and the coverage you buy, you may want to look into fire insurance on top of your standard dwelling protection.)
• Earthquakes. The San Andreas fault line runs through the state of California, earning it the nickname Earthquake Country. In fact, California is the second most seismically active state, just behind Alaska. While many homeowners insurance policies exclude damage from earthquakes or other ground movement, living in a risky area near so many faults can still influence your premiums. (You may also want additional earthquake insurance coverage to protect your home best.)
• Flooding. All of California’s 58 counties have experienced at least one major flood event in the last 25 years, each of which caused catastrophic damage. While a standard homeowners insurance policy doesn’t protect against flood losses, living in an area prone to water damage may increase your premiums.
• Mudslides. Another earth movement to consider is mudslides, which occur hundreds of times each year in the state. Yet again, mudslide losses typically won’t be covered by your basic homeowners insurance policy, so consider adding a flood policy when buying house insurance in California. 

Common insurance discounts in California

The cost of living in California is notoriously high, while homeowners insurance rates have risen across the country. Scoring discounts on your policy can help you save money and build the coverage you need at a price you can fit into your budget.

Each company has its own potential discounts, which may vary from one policy type to the next. However, some of the most common insurance discounts in California include the following:

• Multi-policy bundle discounts — If you buy more than one policy from the same company, you can often snag discounts on all policies.
• No claim discounts — Go multiple years without making a claim against your homeowners insurance coverage, and you’ll usually be rewarded with lower premiums and select discounts.
• Pay in full or autopay discounts — Some carriers will offer a discount if you’re willing to pay your policy term’s premiums upfront or sign up for a monthly autopay.
• Discounts for eligible features and systems — If you have a security system, in-home sprinklers, a fire-resistant roof, or other protective features, you may be eligible for discounts.
• Certain affiliations — Depending on the carrier you choose, you may be able to lock in discounts for being military, a first responder, or even having affiliations with certain schools and organizations.

Tips for lowering home insurance rates

No matter where you are buying home insurance coverage, there are a few things you can do to lower your premiums and pay less for your coverage.

Change your deductible. You can usually reduce your premiums by choosing a higher deductible on your policy. Your deductible is the portion of a covered loss that you need to pay out of pocket before your insurance company will step in and make payments. If you’re willing to accept more of a risk (by choosing a higher deductible), you’ll often be rewarded with lower premiums.

Consider making certain updates. You might be surprised by the impact of certain home features on your premiums. Sometimes, replacing your roof, updating your electrical wiring, building a fence around your pool, or adding in-home sprinklers can lower your premiums substantially.

Don’t overinsure. It’s important to buy enough coverage to adequately protect your home and your financial interests, but you don’t want to buy an excessive policy. Your policy’s coverage should adequately insure your home and belongings, of course, but lowering your coverage limits a bit will usually drop your premiums.

Opt for ACV. Homeowners insurance can protect your property with actual cash value (ACV) or replacement cost value (RCV) coverage. Actual cash value is usually more affordable, as it will only reimburse you for your home and personal belongings’ current value, including depreciation for age or wear. Replacement cost coverage, on the other hand, will pay what it takes to make you whole again at the time of the loss. 

Shop around. One of the best ways to lower your insurance premiums and ensure that you snag the best deal on coverage is to shop around. Be sure to get home insurance quotes in California from multiple carriers to see what sort of options are available to you and how much you’re looking at paying; then, compare your options before moving forward with any one company. 

What does California home insurance cover?

Protecting your home with adequate homeowners insurance coverage is imperative, but every policy is a bit different. It’s important to read your California property insurance documents carefully to understand exactly what your policy does and does not cover. 

An HO-3 homeowners insurance policy is the most common, offering owners a combination of the following:

• Dwelling coverage for their home and attached structures
• Personal belongings coverage for the things they own
• Personal liability protection in case someone else is injured on the property or at the hand of someone living in the home

Dwelling coverage protects your home (the actual building) from a number of different perils. These typically include things like fire, smoke, lightning, hail, wind, vandalism, theft, and more. If your home is damaged or destroyed, your insurance policy will pay to repair, rebuild, or even replace it up to your policy’s coverage limits. This coverage often includes additional structures, such as a fence, deck, gazebo, or patio on the property but not attached to the home.

You’ll usually also have coverage for your personal belongings, such as your clothes, furniture, electronics, decor, and more. If your home suffers a loss, this coverage can help pay to replace your items.

You may also have personal liability coverage from your homeowners insurance policy. This coverage can financially protect you if someone slips and falls on your property, gets bitten by your dog, and more. This coverage helps pay for things like the other individual’s medical bills, legal expenses, lost wages, and more. 

Lastly, many policies also offer financial protection if you are displaced from your home. This coverage can help pay for hotel or other lodging, food expenses, laundry services, transportation, and more. 

Additional California insurance coverage options

In addition to the standard coverages offered by California house insurance policies, there may be a few additional options available. These can come in the form of endorsements (or riders) offered by your home insurance company or additional policies for purchase through the state or even FEMA.

• Extended replacement cost coverage
• Flood insurance 
• Water backup coverage
• Wildfire insurance
• Mold coverage
• Scheduled personal property insurance
• Catastrophe insurance

Adding any (or all) of these can protect your home but will usually also increase the cost of your coverage.

What coverage is recommended in California?

The insurance coverage you need as a California resident depends on where you live and what you can afford. If you live high up on a hill in the middle of the state, you might not need flood insurance. If you live up against a forest, however, wildfire insurance could be a wise buy.

At the very least, be sure that you have enough basic protection to rebuild or replace your home and your belongings following a total loss. You should also have liability coverage in case someone is injured on your property. Beyond that, added endorsements can help protect your California home from some of the most common perils in your area.

Insuring your home in California

Whether you are required to have home insurance in CA or (wisely) want to protect your property from loss, you’ll want to shop around a bit first. 

Decide how much coverage you need. Your carrier will help determine how much your home would cost to replace or rebuild. You will need to roughly calculate how much coverage you need for your personal belongings, though.

Choose your policy type. The most common homeowners insurance policy is an HO-3. There are important differences to note between HO-3 and HO-6 policies, though, as well as basic dwelling coverage. Choose the one that best fits your home and risk level.

Get quotes. It’s always wise to get multiple homeowners insurance quotes in California so you can compare insurance companies and policy options and choose the best possible coverage for you. (Shopping through a platform like Hippo allows you to compare policies from multiple top-rated carriers at once!)

Determine your deductible. As mentioned, a higher deductible can be one way to potentially lower your insurance premiums. However, be sure that whichever deductible you choose, you can afford the cost following a covered loss. 

Pick your add-ons. In addition to protecting against standard perils, you can also add riders to your policy for added coverage. These riders may expand the coverage you already have, protect your home against additional perils, and more.

Is California homeowners insurance required by law?

Homeowners insurance coverage is not required by law at either the state or federal level. However, if you purchase your home with the help of a home mortgage loan, your lender will require that you carry homeowners insurance coverage in order to protect their assets.

Home insurance coverage is often a condition of your mortgage loan and may even need to be paid through escrow. If you don’t maintain adequate coverage on the home, your lender will purchase force-placed insurance at your expense. Even though you’re footing the bill, force-placed insurance will only cover your dwelling and, in turn, your lender’s asset. It doesn’t offer you the same protections as a standard policy, such as personal liability protection, personal belongings coverage, or loss of use protection.