California Insurers Resumed Writing Home Policies
Homeowners in California may see more options as insurers return after securing rate increases.
Updated on Oct. 2, 2026 in Insurance
Live Poll
Do you trust that current insurance regulations prioritize the availability of home coverage for residents?
Since January 2025, insurance companies have resumed writing new homeowners policies across California as part of a new state regulatory strategy. This shift follows periods where many insurers paused new business due to wildfire risk concerns.
Why it matters
The change aims to reduce reliance on the state-backed FAIR Plan, which has seen its active policy count grow 157% since September 2022. By allowing insurers to use catastrophe modeling and factor in reinsurance costs, the state hopes to stabilize the private market for 8 million homeowners.
Five of 10 companies seeking rate increases, including Farmers and Mercury Insurance, have committed to writing 12,189 new policies. This occurs as California home insurance costs rose 5% in 2026.
The players
California Insurance Department
The state agency that regulates insurance products, oversees rate filings, and manages the FAIR Plan.
Farmers Insurance
A private insurer that committed to writing 5,596 new policies following a $150 million rate increase.
Mercury Insurance
A private insurer that committed to 2,107 new policies after receiving approval for an $85 million rate increase.
Ricardo Lara
The California Insurance Commissioner whose term expires in January 2027.
The details
Under the new strategy, insurers are required to commit to increasing sales in high-risk areas to qualify for rate hikes, which currently total $571 million in requests or secured increases. For example, Farmers Insurance committed to writing 5,596 new policies following a $150 million rate increase, while Mercury Insurance agreed to 2,107 policies after an $85 million increase. These companies now integrate advanced catastrophe modeling into their pricing to manage wildfire-related liabilities more effectively.
Timeline
September 2022 served as the starting point for FAIR Plan growth tracking.
January 2025 marked the effective date of the current sustainable insurance strategy.
June 2026 data shows the FAIR Plan reached approximately 697,000 active policies.
November 2026 is when California voters will choose a new insurance commissioner.
January 2027 marks the expiration of Commissioner Ricardo Lara's term.
Money Landscape
The return of private insurers marks a potential departure from the rapid expansion of the California FAIR Plan, which has served as an insurer of last resort for hundreds of thousands of households. This strategy aims to shift the market away from state-backed coverage and back toward private competition.
Homeowners currently insured through the FAIR Plan may now have the opportunity to shop for private market alternatives. Discuss with a licensed insurance professional whether these new policy commitments offer better coverage or pricing terms than your current high-risk plan.
The takeaway
The return of private insurers suggests a shifting landscape for California homeowners who have struggled to find standard coverage. Monitor your annual renewal notices and consult with a qualified insurance agent to determine if the new influx of private policies offers a more competitive budget option.
Further reading
For more on managing your coverage costs, explore the California Insurance section.
Source note: This article includes information reported by El Observador.
Live Poll
Do you trust that current insurance regulations prioritize the availability of home coverage for residents?
