A private firefighter in the wasteland monitors a raging fire along Old Lawley Toll Road during the Glass Fire in Calistoga, California, U.S., October 2, 2020. Photo taken October 2, 2020 .
Stephen Lam | Reuters
State Farm General Insurance Company on Friday announced that it will stop accepting new applications for homeowners insurance in California, citing “rapidly increasing” disaster risks such as wildfires, a “historic increase” in construction costs, and the reinsurance market. challenging dangers.
“We take our responsibility for risk management seriously,” the company said in a release.
State Farm said it will stop accepting new business and personal property and casualty insurance applications starting Saturday. The new policy will not affect individual auto insurance, according to the release. State Farm independent contractor agents will also continue to serve existing customers.
The company said it would work with the California Department of Insurance and other policymakers to improve conditions in California, but State Farm decided to take action to improve its “financial strength.”
“We will continue to evaluate our approach based on changing market conditions,” State Farm said.
State Farm did not immediately respond to CNBC’s request for comment.
