Allstate homeowners insurance rate to increase an average of 34%, state's largest spike in 3 years

LOS ANGELES (KABC) -- California's Department of Insurance has approved Allstate's request for the largest rate increase in the state -- more than any major insurer in the past three years.

According to the state agency, Allstate filed for a 39.6 % increase last year before amending the request to 34.1% in January.

The insurer cited higher repair costs, frequent severe weather events and legal system abuse for the increase. The rate hike is expected to affect more than 350,000 policyholders.

Allstate stopped writing new California homeowner insurance policies in November 2022, and last year, the company received approval for a 4% rate hike.

Consumer Watchdog President Carmen Balber challenged Allstate's move.

"To be frank, it has been very difficult to get full disclosure from the company about the secret black box model that it uses to determine wildfire risk," she said last month.

Residents feel impact of skyrocketing rates

Hari and Diana Barnes, who live in Tujunga, said they've seen their home insurance premium cost go up over the last five years.

"Ours went from $1,000 a year to $10,000 a year," said Diana. "We have shopped around. It's not for the best rate, it's for anyone who will insure us."

But Balber suggests those who are shopping for home insurance to consider the following:

"What kind of discount might I qualify for if I do things like replacing my roof, or clearing the brush and the trees around my home, can that reduce my insurance rate?"