Two major home insurance providers in California, Travelers Insurance and the Interinsurance Exchange of the Automobile Club, are planning to raise rates and expand coverage by late 2026.
Travelers Insurance aims for a 6.9% rate increase for single-family homes, while the Interinsurance Exchange seeks an 11.2% hike, according to the Daily News.
These changes are part of a new catastrophic modeling plan adopted by the state in 2025, designed to address rising wildfire risks. In exchange for writing residential policies for at-risk properties equal to at least 85% of their market share, insurers can adopt this model, which includes forward-looking risk factors and reinsurance costs to justify rate increases.
But there’s also a plan to decrease rates for some. Travelers plans to decrease rates by 17% for renters, 22.8% for condo owners, and 19.6% for condominium landlords. The company will also support homeowners in exiting the Fair Access to Insurance Requirements Plan (FAIR), a last-resort insurance option for high-risk properties. The Orange County Register reports that the FAIR Plan’s exposure increased by 42% from September 2024 to June 2025.
The Interinsurance Exchange plans to reduce rates for renters by 27% and for condo owners by 20.5%. They also intend to add over 2,000 policies in fire-risk areas. Both companies’ proposals are pending approval from the Department of Insurance, a process that typically takes 120 days.
The proposed rate hikes come amid ongoing legal actions against State Farm for alleged mishandling of wildfire claims. The insurance market in California continues to evolve as companies adjust to new regulatory frameworks and environmental challenges.
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