The San Francisco Chronicle – California home insurance crisis: Another major insurer reduces coverage


Another home insurance provider will reduce future coverage in California, as other companies have done in previous months in response to costly wildfires. 

United Services Automobile Association Group (USAA) outlined restrictions for new California property insurance policies that will take effect next March in a filing to the California Department of Insurance. 

USAA plans to evaluate properties using a model to determine each property’s wildfire risk based on location. The model will calculate a number — 1 through 32 — representing the risk, with 32 being the greatest risk. 

Per the new rules, homeowner applicants must have a wildfire score of 1 to be eligible for new policies. Any properties with a score of 2 or higher are deemed unprofitable. 

Contra Costa and Solano counties were both ranked with a score of 16 in the filing, though a comprehensive list including all of the Bay Area’s county rankings was not included in the document. 

Homeowners cannot improve their score by mitigating the risk, according to USAA. 

USAA Casualty Insurance Company and Garrison Property and Casualty Company, which are part of the USAA group, have stated that people seeking new policies “must be replacing an existing Homeowners policy,” along with meeting the fire-scoring eligibility requirements. 

Neither USAA nor the California Department of Insurance responded to requests for comment. 

USAA stated in the filing it “is not non-renewing policies for wildfire risk.” 

The filing — made in April — was first reported by the San Francisco Standard last week. 

Carmen Balber, executive director of Consumer Watchdog, said the California insurance commissioner does not require approval for changes like the new wildfire scoring system, although she said that other elements of the filing — discounts for fire mitigation strategies such as debris removal and improved roofing — would need state approval. (The filing was not  included in a list published last month of California Department of Insurance’s approved rate filings.) 

In 2022, USAA had about 2.7% of the market share for California Property and Casualty insurance, according to California Department of Insurance data. 

Over the past year, major insurers State Farm and Allstate announced plans to stop issuing new homeowner policies in California.

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