Allstate Plans to Raise California Home Insurance Premiums by an Average of 34%

LOS ANGELES (KABC) — Allstate plans to raise its home insurance premiums in California by an average of 34 percent, making it the largest rate hike of the year.

According to the state Department of Insurance, Allstate requested a 39.6% increase last year before changing the request to 34.1% in January.

The insurer cited higher repair costs, frequent severe weather events and abuses of the legal system as reasons for the increase. The rate hike could affect more than 350,000 policyholders.

Allstate stopped writing new homeowners insurance policies in California in November 2022, and last year the company was approved for a 4% rate increase.

Carmen Balber, president of Consumer Watchdog, is challenging Allstate’s decision.

“To be frank, it has been very difficult to get full disclosure from the company about the secret black box model it uses to determine wildfire risk,” she said.

Residents feel the impact of soaring rates

Hari and Diana Barnes, who live in Tujunga, said they have seen the cost of their home insurance premiums increase over the past five years.

“Ours went from $1,000 a year to $10,000 a year,” Diana said.

“We did some research. It’s not about the best rate, but the one that’s willing to insure us.”

But Balber suggests those looking for home insurance consider the following:

“What kind of discounts can I get if I do things like replace my roof or remove brush and trees around my home? Can that lower my insurance rate?”

Allstate’s request is still under review.