Thousands more Californians will lose their home insurance this summer as two more insurers withdraw from the state.
In filings with the California Department of Insurance, Tokio Marine America Insurance Company and Trans Pacific Insurance Company said they would both withdraw from the homeowners and personal umbrella insurance markets in California. Both are subsidiaries of Tokio Marine Holdings Inc., a Japanese company.
The two companies together insured 12,556 homeowner policies in California with $11.3 million in premiums, according to their filings. Tokio Marine also insured 2,732 personal umbrella policies for liability worth $400,000.
Tokio Marine America and Trans Pacific join a roster of insurers big and small that have limited and stopped doing business in California, often citing the risk of wildfires in the state. Some, such as AllState and State Farm, have stopped writing new policies in the state though they continue to renew policies — though last month, State Farm also announced it would not renew 30,000 homeowner policies, a small fraction of its total business in California. Farmers Direct Insurance has chosen to leave the state.
In response, California Insurance Commissioner Ricardo Lara has proposed a slate of reforms known as the Sustainable Insurance Strategy, designed to attract insurers back to the state. They include ideas such as changing the process for requesting rate hikes to allowing insurers to use forward-looking risk models when raising their rates. All of the strategy’s reforms are set to take effect at the end of the year.
Tokio Marine did not immediately respond to a request for comment. Neither company disclosed in state filings the reasons behind the withdrawal or where their policies are located in the state.
The companies will begin sending non-renewal notices to customers starting July 1, according to state filings.