California homeowners can expect the nation’s steepest insurance premium hikes this year, with premiums projected to jump 16% in 2026, according to policy tracker Insurify. That’s the largest increase in the country, four times the 4% hike a typical American faces.
The surge reflects years of rising property damage claims, with the 2025 Los Angeles wildfires as the most recent and costly example. Insured losses from those fires are estimated in the $25 billion to $30 billion range, making them the costliest natural disaster of early 2025.
Even after the 2026 increase, California property insurance remains relatively affordable compared with the rest of the country. Insurify projects the average annual premium in California for 2026 will be $2,843, ranking 21st-highest among all states. By contrast, Florida tops the list at $8,458 per year, followed by Oklahoma at $5,205 and Louisiana at $5,035.
The reason for California’s lower absolute rates, despite the steep increase, lies in state insurance regulation. For years, regulators kept rates artificially low to protect consumers, even as insurers’ costs and risks mounted. That regulatory restraint has made it difficult for private insurers to raise rates, forcing many property owners who cannot obtain coverage to turn to California’s FAIR Plan, the insurer of last resort. Those premiums are expected to rise by 29% next year.
After California, Nebraska is seeing a 13% increase in 2026, followed by New Mexico at 11% and Georgia at 10%. Meanwhile, policies are actually getting cheaper in Hawaii and Massachusetts, which are both down 2%, and Maine, down 1%.
The 16% projection comes as the insurance industry nationwide continues to face pressure from climate-related losses and inflation in construction costs. Between 2021 and 2024, home insurance carriers increased premiums in 95% of the U.S., with over a third of homeowners seeing premiums rise 30% or more during that period.
Sources
- Orange County Register — Insurify data on projected 2026 home insurance rates by state, California’s premium increase, and comparison to national average
- Moody’s — Insured loss estimates from the 2025 Los Angeles wildfires
- Insurify — Average annual premium projections for California and ranking among states
