State Farm will no longer insure new homes in California, company says

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The new policy began on Saturday.

"State Farm General Insurance Company made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market," the company wrote on its website.We take seriously our responsibility to manage risk. We recognize the Governor's administration, legislators, and the California Department of Insurance for their wildfire loss mitigation efforts.

We pledge to work constructively with the CDI and policymakers to help build market capacity in California. However, it's necessary to take these actions now to improve the company's financial strength. We will continue to evaluate our approach based on changing market conditions.

 

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