Two Major Insurers Seek Homeowner Rate Hikes in California

The Interinsurance Exchange of the Automobile Club and The Travelers Companies have applied to the California Department of Insurance for rate adjustments affecting roughly 760,000 homes. The Interinsurance Exchange is seeking an 11.2% increase for single-family homeowners, while The Travelers Companies is requesting a 6.9% hike for the same group.

Both companies proposed offsetting these increases with rate decreases for other categories. The Interinsurance Exchange seeks reductions of 20.5% for condos and 27% for renters. Travelers proposes decreases for renters (17%), condo owners (22.8%), and condo landlords (19.6%). These requests utilize a catastrophic modeling plan adopted by the state in 2025, which allows insurers to use forward-looking risk factors and reinsurance costs to justify increases provided they maintain coverage for at least 85% of their market share in at-risk areas.

If approved, both insurers intend to expand the issuance of new policies and help homeowners transition out of the Fair Access to Insurance Requirements (FAIR) Plan. The Interinsurance Exchange specifically plans to add over 2,000 policies in fire-risk areas. These applications follow previous rate increase approvals for Mercury Insurance, USAA, and Pacific Specialty Insurance Co., as well as recent legal action by the California Department of Insurance against State Farm for allegedly mishandling wildfire claims from January 2025.