The company’s withdrawal from the California homeowners market follows similar actions by State Farm, Allstate, Farmers Insurance, USAA, Kemper, and CSE Insurance Group based in Beaverton, Oregon. Within a span of less than a year, all seven insurers have either reduced coverage or exited the state, as previously reported.
Confirming the move, Suzanne Barlyn, a spokesperson for The Hartford, based in Connecticut, reiterated the company’s stance through a formal statement.
The decision underscores the evolving dynamics within the insurance industry, particularly in regions like California, where insurers face mounting challenges amid shifting regulatory landscapes and escalating risks associated with climate change and natural disasters.
The insurer stated the decision does not impact its other products.
“(We) continue to write all our other existing products in California, such as business insurance and personal auto, and will continue to renew existing homeowners’ business consistent with our underwriting guidelines,” the statement revealed.
It continued: “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. Based on these challenges and our analysis of the trends, we have decided to stop offering new homeowners policies starting Feb. 1, 2024.”
The Hartford declined to provide specific comments regarding the impact on homeowners in the North Bay region. However, data from S&P Capital IQ indicates that The Hartford’s market share for homeowners’ insurance in California is less than 1%. Notably, The Hartford serves as the exclusive provider of home insurance for AARP members, suggesting that the 55-plus demographic in California might be disproportionately affected by the insurer’s decision. Despite inquiries, both AARP and The Hartford refrained from addressing this concern.
California’s Insurance Commissioner, Ricardo Lara, introduced the Sustainability Insurance Strategy in September, hailed as the most significant insurance reform in the state in 35 years. The strategy aims to enhance insurance options and safeguard Californians from escalating climate threats while ensuring the long-term sustainability of the state’s largest insurance market.
Although The insurer did not explicitly attribute its decision to years of major wildfires, floods, or other climate-related hazards in California, its statement suggests a correlation with these factors.
“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. We will be watching those efforts closely,” the official statement said.
