Allstate, one of California’s largest home insurers, is asking to raise its homeowners insurance rates by an average of 34.1% later this year.
If regulators approve the filing without changes, which is uncertain, it would be the largest rate increase by a major insurer in the past three years. The request is larger than the 30% average increase that State Farm, California’s largest insurer, is seeking.
More than 350,000 policyholders would be affected by the rate change. Allstate is California’s sixth largest home insurer, representing about 5.5% of the overall market as of last year, according to the Department of Insurance.
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Allstate’s proposed figure is an average, meaning that premium changes would vary from house to house. Some customers could actually see their rates decrease by as much as 57%, but most would see higher rates, and at least one homeowner’s rates would increase by 647%, according to the request. Another homeowner, living in Mariposa County, would see a rate increase of 385%, according to the filing.
Allstate’s proposed home insurance rate changes
Allstate’s requested rate hike would increase average premiums by more than $4,000 in some places. It has yet to be approved.
The California Department of Insurance is reviewing the filing and will determine the exact increase amount and when it could go into effect. Department experts analyze companies’ data about their past costs and claims to determine how much they should be allowed to raise their rates; the increases cannot be excessive or discriminatory. Depending on its analysis, the department could approve a lower rate increase. In 2023, for example, Farmers Insurance Group applied to raise its homeowners, renters and condo rates by 25.5% on average, but was approved for only 12.5%.
If approved without alterations, Allstate’s homeowner rate increase would be the largest of any insurer this year and the largest increase by a major insurer since 2021, when Homesite Insurance Company was approved to raise homeowner rates by 38.2%.
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