Home Insurance in San Francisco
Home insurance for properties across California has been a big topic for the last year.
Many of the top insurance companies (State Farm, Allstate, Lemonade, and others) have pulled out of the state entirely, or have limited the number of new policies they are issuing, making homeowner’s insurance harder to find. The remaining companies have been forced to pick up the excess and it’s made quite a mess when purchasing a new home. Even if you have an existing policy, some of these companies will not renew a policy for you if you move and you’ll have to find a new provider.
The hardest insurance policies to find in San Francisco right now are: HOA policies for condo buildings, especially if they are historic buildings not kept in great condition/updated, insurance for houses that have not been updated (even some down-to-the-studs remodels are having a hard time finding insurance), landlord insurance policies. What has continued to not be an issue so far is condo insurance for the walls in policy, no matter the age (though the prices have gone up).
This has been such a headache that in June of 2023, the San Francisco purchase agreement actually added a contingency to offers for investigating insurability of any property you are trying to buy. The best thing to do if you are heavily considering a property is getting in touch with insurance providers BEFORE you submit an offer.
As of right now, if you are insuring over a certain dollar amount, some insurance companies will actually come and do an INTERIOR inspection of your property and will check things like your electrical and plumbing systems in addition to the exterior driveby that looks at things like your roof’s condition, any broken windows, badly flaking paint, etc. If they don’t like what they see, they will deny your policy, cancel it, or give you X number of days to correct the issues (which can be a big, time-consuming, expensive job if you’re considering something like rewiring the house).
The WHY:
Did you know that California actually limits what insurance companies are able to charge for insurance on properties? There’s a process in which the insurance providers have to submit their proposed rates to the state insurance department and then the regulators either accept or reject the insurance company’s proposal. This has, unfortunately, been part of the problem. When State Farm left, they stated they were pausing new policies to “improve the company’s financial strength”. Allstate had done the same a few months before that.
The good news is that the state is trying to work with these companies to resolve this issue, but this will take a while. You can read more about that here. I’ll be keeping my finger on the pulse of what’s happening as time goes on, so feel free to check in with me if you have any questions.
