The Hartford, a prominent insurance provider, has joined the ranks of insurers scaling back their offerings in the challenging California homeowners insurance market. Confirming this decision, a spokesperson revealed that as of February 1, The Hartford will cease providing new personal property insurance coverage in California.
Citing unique challenges within the homeowners’ insurance landscape in California, the spokesperson explained, “The homeowners’ insurance environment in California has unique challenges that have required us to reconsider the viability of writing new homeowners’ business in the state.” The decision to discontinue new homeowners policies is grounded in a comprehensive analysis of trends and challenges in the region.
It’s noteworthy that this shift in focus will not impact The Hartford’s existing products in California, such as business insurance and personal auto insurance. The company is committed to continuing the renewal of existing homeowners’ business in accordance with its underwriting guidelines.
Despite The Hartford holding less than a 1% market share in homeowners insurance in California, this move aligns with a broader trend in the industry. The San Francisco Standard initially reported on The Hartford’s decision, which follows similar actions taken by major insurers like State Farm, Farmers, USAA, Kemper, and CSE Insurance Group, all of whom have recently scaled back or adjusted their involvement in California’s homeowners insurance market.
California Insurance Commissioner Ricardo Lara has responded to the challenges in the homeowners insurance sector with the Sustainability Insurance Strategy. This initiative, recognized as the most significant reform since Proposition 103 in 1988, has garnered mixed reviews. While the American Property & Casualty Insurance Association (APCIA) welcomed it as a crucial step, some critics, including a leader from a California broker association, have described the strategy as “long on hope and short on specifics.”
In response to these developments, The Hartford expressed appreciation for Commissioner Lara’s efforts to stabilize the market, stating, “We do not enter into this decision lightly, and we appreciate and support efforts like Commissioner Lara’s Sustainability Insurance Strategy to help bring stability to the market.” The company intends to closely monitor these efforts as the situation evolves.
