Liberty Mutual Is Dropping ALL Condo Policies In California By 2026 Due To Wildfires And Other Natural Disasters

Major insurer Liberty Mutual announced it is dropping all its condo policies in California. 

The company has told regulators that it will stop offering new condo and renter policies next year.

Liberty Mutual told the California Department of Insurance that existing policyholders will then see their coverage axed in 2026.

It comes as several large insurers have fled the state amid worsening climate disasters. Thus, leaving many people struggling to find home cover. 

Over half of Californians said earlier this year that they had been affected by rising premiums for property coverage or had been dropped by their insurer entirely.

Wildfires are becoming increasingly common across California. They have burned more than 1 million acres of land this year so far. 

Liberty Mutual currently insures just under 67,500 condos and about 102,200 rental properties.

In 2023, the insurer covered 6.75% of the California home insurance market. However, it has not written new condo and rental policies under the Liberty Mutual brand since December 2023. 

In August, the company also said it was discontinuing its fire dwelling insurance for around 17,000 policyholders in the state.

Dwelling fire insurance is different to a typical homeowners policy. The main purpose of the coverage is to cover fire damage to the structure of a home itself. It does not cover the contents inside. 

Dwelling fire policies are often bought by landlords or vacation homeowners.

Liberty Mutual said it expects its agents to help affected customers find new coverage.

All existing customers will remain covered until at least January 2026.

Are California Regulators Making A Bad Situation Worse?

It comes as regulators in the state are phasing in reforms to help stabilize the insurance market.

Experts say this has caused a crisis in the California real estate market.

As major companies such as State Farm have cut back in the state, this has led to a lack of competition.

Labor shortages and higher fees for home repairs have also been pushing up prices for homeowners in the state.

And some Americans unable to find cover have been forced to buy into the expensive FAIR plan. FAIR is California’s insurer of last resort.

Farmers Insurance announced earlier this month that it would increase the number of California homeowners policies it writes. Farmers is telling the media that they feel the marketplace has ‘improved.’

Read More About Insurance Companies Dropping Homeowners On MFI-Miami.com.