California homeowners insurance
Compare, shop and customize quotes from top-rated insurance carriers.
Tools to help find the best California homeowners insurance
Your home is likely your biggest investment, so protecting it is very important. With the number of possible insurance providers in the state of California, the process of choosing the right policy may feel overwhelming. However, the right tools can provide you with the information you need to make the best choice for your unique circumstances.
Why you need home insurance in California
Approximately 40 million people call California home, which is more than the total number living in Canada. It is the third largest state in square miles, behind Alaska and Texas. With so many people residing in such a large area, the demand for affordable homeowners coverage is a high priority. The state also faces a number of weather and environmental risks that can damage a home and cause financial hardships for an uninsured homeowner.
Earthquakes
California has over 90 potentially active faults. Although most of them are too small to be physically felt, California experiences around 10,000 earthquakes per year. Several hundred of these earthquakes measure a magnitude of 3.0 or greater, and 15 to 20 measure over 4.0, which is intense enough to cause damage. Generally, California homeowners coverage does not cover earth movement, earthquake or landslide damage, so you should consider your level of need to determine if you want a separate Earthquake Insurance policy, which should cover the structure, contents and other expenses resulting from a disaster.
Fires
The state of California suffered nearly 7,600 wildfires in 2022, which destroyed 772 structures and damaged 104 others. The basic homeowners insurance policy, known as an HO-3 policy, generally covers damage from fire, but wildfires may be an exclusion depending on the policy and provider.
Floods
There are approximately 270 flood-prone areas in all 64 of California's counties. Most homeowners policies exclude flood damage from their coverage, and this calls for a separate purchase of Flood Insurance. If your home has a government-backed mortgage, you must have Flood Insurance, and some lenders require flood coverage even if the home is not in an area at high risk of flooding.
California homeowners insurance requirements
While there is no legal requirement for residents to carry California homeowners insurance, lending institutions generally require a borrower to have insurance in order to protect their investment.
Even though the state does not require homeowners insurance, obtaining a policy that will protect your investment in your home is still a wise decision. VIU by HUB provides the necessary tools to compare coverage options so you can find the best policy at the best price.
Home insurance coverage
Home insurance is infinitely customizable, depending on your financial situation and the specifics of your home. There are basically three Dwelling Coverage valuation options on a California homeowners insurance policy:
• Actual Cash Value: Covers the value of the house and your possessions minus depreciation cost, so you receive the current value of the items, not the amount you paid.
• Replacement Cost: Covers the actual cash value of the home and belongings without subtracting depreciation, which enables you to rebuild the home up to the cost of its original value.
• Guaranteed Replacement Cost: Covers the actual cost of repair or replacement of the damaged home and items, even if repair or replacement exceeds policy limits.
Once you have determined your desired coverage level, you decide what type of insurance coverage you need. Standard California homeowners insurance policies generally include six types of coverage:
Dwelling Coverage
Dwelling Coverage pays for losses to the main structure and any attached structures, such as a garage or carport. Also included are plumbing, electrical wiring and heating and cooling systems.
Other Structures
In the event of a covered incident, coverage for additional structures will pay for the repair or replacement of other unattached structures (such as fences or sheds) on the property.
Loss of Use
If a covered peril causes the dwelling to be uninhabitable, Loss of Use coverage will pay for your living expenses, including hotel and restaurant bills.
Medical Payments
If someone outside your immediate family is injured on your property or due to the unintentional actions of a household member, the Medical Payments section of the policy provides coverage for some associated medical expenses.
Personal Liability
The Personal Liability coverage on a California homeowners insurance policy takes care of the costs up to the limits of the policy if someone sues you over bodily injuries or property damage that you or a member of your household causes.
Personal Property Coverage
Personal Property insurance takes care of the costs of personal items, such as furniture, clothing or sports equipment, which are damaged or destroyed in a covered incident. Be aware that there are coverage limits for high-dollar items such as fine art or jewelry, although separate special coverage is available for these types of items.
Costs of home insurance in California
While many factors affect the cost of a California home insurance policy, one of the biggest determinants is the home's value. Currently, the average value of homes in California is $718,687, and California residents pay around $1,180 per year for their home insurance, which is below the national average.
Other factors that impact the cost of homeowners insurance include the following:
• Insurance provider.
• Coverage amounts and types.
• Deductible level.
• Other insurance policies (bundling options).
• Your credit history.
In addition, the location, value, age and condition of your home can impact the rates you pay. Home safety and security features may lower rates in some cases.
This information is intended for general informational purposes only and is not intended to constitute legal advice.