Home insurers pull out of California thanks to wildfires and state regulations

State Farm said this month it will stop insuring new homes in California, joining a growing list of insurers that have reduced operations in the Golden State in response to rising wildfire exposure and a challenging reinsurance market.

State Farm, which cited historic increases in construction costs, “rapidly growing” catastrophe risks, and reinsurance market challenges as the reasons behind its decision, is the largest provider of homeowners insurance in the state, protecting an estimated 22% of residents.