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Allstate has stopped writing new homeowner, condominium and commercial insurance policies in California, the company confirmed to The Chronicle.
The insurer, the fourth largest property and casualty insurance provider in the state in 2021, paused new policies “so we can continue to protect current customers,” spokesperson Brittany Nash wrote in an email to the Chronicle.
The pause began last year but appeared to receive only a passing mention in industry publications. The Chronicle learned of the development this week, after reviewing an Allstate rate increase request to the California Department of Insurance.
It was not immediately clear what prompted Allstate’s pullback on new policies. But State Farm, the largest provider of property and casualty insurance in California, made waves in late May by announcing it would stop issuing new homeowner policies in the state due to inflation, wildfires and rising reinsurance costs.
That Allstate quietly did the same thing last year signals that the insurance woes in the state may be more severe than the public is aware of.
“State Farm is unusual in that it announces such underwriting actions. It is not required by law and most insurers do not,” said Rex Frazier, president of the Personal Insurance Federation of California, in an email to The Chronicle over the weekend.
The only public disclosure required of insurers pulling back eligibility in the state comes when they ask the California Department of Insurance for rate increases, Frazier said Thursday.
At least two other insurers, AIG and Chubb, which cater to high-end homes, have pulled coverage for some of their customers in recent years.
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In addition, Florida and the southeastern coast are all vulnerable to hurricanes. The natural disaster issue is more widespread than we think.
https://grist.org/extreme-weather/wildfires/
https://www.nbcnews.com/id/wbna17692537
That has long been the pattern with one natural disaster, earthquakes: https://www.fema.gov/emergency-managers/risk-management/earthquake/insurance
Wild fire tends to show up more often in California.
Both states share flooding problems in different ways.
Arizona is strangely tranquil, all things considered.
https://washingtonpost.com/science/2023/06/02/earth-commission-climate-pollution-limits/#
As far as humidity goes, Arizona has been keeping its monsoon season quiet for a very long time. I am often reminded of summer in St. Louis, without the bugs and pollens. But we don't live in SW Arizona, which could be future beach-front property on the Gulf of California.
At the present time our utilities are exceptionally backward on the potential for distributed solar as a source of power, or even for an albedo effect. But one of the reasons I bought GRID was a bet on more focused thinking in the future. It wouldn't take much for Arizona to export a lot of electrical energy all year round.
At the present time, my wife would dearly love to go back to California, despite multiple immediate threats like wild fires, flooding, and earthquakes. I think she would be happy in a shoe, or a shoe box. All of the friends. All of the history. And so on.
At the same time, she worries about the effect of global warming on the value of our home in Tempe. Well then. Let's move to Duluth/Superior, St. Paul, Stillwater, etc. We might know some people due to our college daze back there. But if the Gulf Stream collapses, it could be a lot colder than it is now.
This (water) has been a long time discussion among friends who moved to Arizona for work. One couple returned to Michigan last winter permanently, from where they started 30 years ago. We've also discussed the Taiwan Semiconductor factory being built and what will be the water source for such operations going forward. They also grew weary of the traffic flows around Phoenix. So, they gladly trade the summer heat of Arizona for the winter chill of Michigan.
Water politics in the West, and Arizona, deserve a thread of their own for anyone considering investing in water, alternative energy, buying property in the West and so on. And I would be happy to engage.
This thread had been about the particular insurance environment in California, and other regions threatened by the near-term catastrophic effects of changing weather patterns.
In the meantime . . .
If the choice in Arizona comes down to water for semiconductors or Middle Eastern royal families growing alfalfa to export to feed cows in their countries . . . . you might end up paying more for ghee, and other dairy products.
I have never run into anyone that doesn't complain about traffic.
I am afraid wildfires will soon spread further north and east. The coming of El Niño weather pattern will make the west to have another tough year with wildfires.