Attention Homeowners: Insurance Hurdles in Real Estate You Need To Know About

This is why some insurance companies are no longer offering policies.

Today, we’re here to provide an update on the current situation regarding insurance and residential real estate. Several companies, such as Progressive, Allstate, and State Farm, have decided to stop offering policies in California. The reason behind this change is the increasing cost of property replacement in case of fire or flood damage, which has become too expensive. 

As a result, it is now crucial to contact insurance providers to determine if coverage can be obtained for a property. Also, premiums have risen significantly, so it is important to communicate with lenders to ensure that the debt-to-income ratio remains unchanged. All of this could impact your purchasing power. 

To avoid any issues going into the escrow process, it is advisable to address insurance concerns right away. Existing policies will not be terminated unless payments are missed. However, if you are a seller, it is recommended to inquire about insurance options from different companies in your area, particularly if you reside in a high-risk fire zone. 

The ultimate goal is to prevent a situation where a buyer discovers right before closing that they are unable to secure insurance. If you have any questions or need help navigating this, please don't hesitate to call or email us. We’re always happy to help!