Amica OK to Hike Home Insurance Rates by 21% in California | Insurify

California homeowners, renters, and condo owners with property insurance through Amica could soon see their premiums rise again. On Dec. 2, the state's department of insurance approved Amica's request to raise rates for nearly 40,000 policyholders.

Homeowners will see increases of around 21%. Rates will rise 4.5% for condo owners with an Amica policy and 1% for renters, according to the insurer's filing with the California Department of Insurance.

The increases take effect for new policies initiated after Aug. 1 and for policies renewing Sept. 1 or later.

In June, state regulators approved a previous request by Amica to increase home insurance policies by 31.1%, renters insurance by 15.4%, and condo insurance by 14.3%.

Homeowners face the biggest increases

Under the approved rate change request, Amica customers with standard HO-3 homeowners insurance policies will face increases of 15% or more in their annual premiums. The majority — 14,393 policyholders — will see hikes between 15% and 20%. Another 9,255 will pay an additional 20% to 35% when their Amica policies renew.

Homeowners in Running Springs, Pescadero, and Carmel Valley will see the largest average increases, with annual premiums rising $3,670, $3,040, and $2,861, respectively. Some Alamo and Healdsburg homeowners could see increases of more than $12,000 annually.

Condo owners in Encino and Los Angeles face the largest average increases in their Amica policies, at $173 and $162 annually.

Amica is among the smallest home insurers by market share in California, accounting for less than 1% of the overall market. In 2023, the insurer saw a loss ratio of nearly 95%, according to California Department of Insurance data. A loss ratio compares how much an insurer pays out in claims and other expenses to the amount of premiums it collects. The higher an insurer's loss ratio, the less profitable it is.

What's next: Property insurance rates will continue to rise in California

The average annual cost of homeowners insurance in California is $1,782, according to an Insurify report. Insurify data analysts predict an 8% increase in home insurance costs in the Golden State throughout 2024, bringing the projected annual rate to $1,921.

California's exposure to wildfires, severe weather, and earthquake risks, and strict regulation of the insurance industry, has prompted multiple insurers to restrict new business in the state or exit its market altogether. Many insurers that have stayed in California have requested — and received — double-digit rate increases or permission to non-renew higher-risk policies.

Recent developments in the state's homeowners insurance market include:

State Farm, the largest home insurance company in California, announced it would non-renew about 30,000 homeowners insurance policies and 42,000 landlord policies.Liberty Mutual received approval for a 15% increase in condo insurance rates.Allstate won approval for a 34% rate hike, affecting more than 350,000 homeowners.Kemper Independence, Unitrin Direct Property & Casualty, and Merastar Insurance withdrew from California's home insurance market in late 2023.

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