State Farm stops home insurance sales in California, citing wildfire risks | CNN Business

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State Farm is stopping new home insurance sales in California, citing wildfire risks and skyrocketing construction costs

The insurance giant stopped accepting applications for all business and personal lines property and casualty insurance in California on May 27. However, State Farm’s decision does not affect existing auto insurance. “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 said in a statement.

While “insurance companies prioritize their short-term financial goals, the long-term goal of the Department of Insurance is protecting consumers,” California Department of Insurance spokesperson Michael Soller said. The factors behind State Farm’s move are beyond the agency’s control, Soller added. “It’s important to note that current State Farm customers are not affected, and no non-renewals are being issued as a result of this announcement,” Soller said.

 

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