The Best Cheap California Homeowners Insurance for 2023

When most homeowners set out to purchase homeowners insurance, they're shopping for a product designed to protect their largest financial investment. To help homeowners purchase homeowners coverage, we've done some of the legwork by finding the cheapest homeowners insurance in California. Here, we offer tips designed to help homeowners find that "sweet spot" between a high level of coverage and low annual premium.

• Cheapest overall: Allstate
• Cheapest for new home construction: Nationwide
• Cheapest for older homes: Allstate
• Cheapest when you've made a claim: Allstate

Cheapest overall for California

The cheapest homeowners insurance overall in California is sold through three well-known insurance companies:

• Allstate, with an average annual rate of $628
• Travelers, offering an average annual rate of $824
• State Farm, coming in with an average annual rate of $949

Cheapest for new home construction

Moving into a new home is not only exciting, but it's also a great way to save money on homeowners insurance. That's because insurance companies aren't quite as worried about what might go wrong with a new house. The cheapest homeowners insurance for new California homes are:

• Nationwide, with an average annual rate of $383
• Allstate, offering an average annual premium of $397
• Travelers, not far behind the competition with an average annual rate of $424

Cheapest for older homes

Older California homes have character, but they're also more likely to be hit with problems like leaky basements and old roofs. That's what makes them more expensive to insure. Still, a good deal can be found. The top three companies for insuring old California homes cheaply are:

• Allstate, with an average annual rate of $585
• Travelers, coming in with an average annual rate of $777
• CSAA, with an average annual premium of $897

Cheapest when you've made a claim

Insurance can be priceless, particularly when a homeowner needs to make a claim. However, making a claim will cause their rates to rise for a period of time. The cheapest coverage for people who have previously made a claim is available through:

• Allstate, coming in with a forgiving average annual rate of $716
• Travelers, following with an average annual rate of $883
• State Farm, providing coverage for an average annual rate of $956

Average cost in California compared to the national average

The average cost of homeowners insurance in California is $1,252, nearly 28% lower than the national average of $1,725.

California homeowners insurance overview

Finding the best homeowners insurance in California can be tricky, primarily because there are so many options. In addition to a low rate, here are some of the other factors homeowners need to consider as they shop for coverage:

Different types of homeowners coverage

There are six different types of policies specifically designed to cover traditional brick-and-mortar homes, from basic policies to policies with all the bells and whistles. The best home insurance companies offer them all. Before shopping, it benefits a homeowner to list all the things about their home they're looking to protect. For example, if a homeowner has a separate structure in the backyard they use as an art studio, it should be included on the list.

Level of coverage

The thing about a bare-bones insurance policy is that it may be cheap, but it is unlikely to provide a full range of coverage. If a homeowner sleeps better at night knowing that their coverage will rebuild their home if it's destroyed -- no matter how much it costs -- it may be worth paying a higher premium for full coverage.

Amount of deductible

A deductible is an amount the homeowner must pay toward a claim. Let's say a homeowner has a kitchen fire that will cost $15,000 to repair, and their deductible is $1,000. That means the insurance company will pay $14,000 of the repair cost, and the homeowner will pay the remaining $1,000.

Potential discounts

One way to land cheap homeowners insurance in California is to take advantage of all possible policy discounts. It's possible to believe one policy is more expensive than another until discounts are factored in. Nearly every insurance company offers a list of discounts, and they cover everything from the job a homeowner holds (or did hold) to whether their home is part of an HOA. In other words, nearly everyone qualifies for one or more home insurance discounts.

What are the most common homeowners insurance claims in California?

Every region is known for a different set of natural disasters. The Midwest has its tornados and ice storms, the Southeast faces down hurricanes, and California is frequently in the news for wildfires. Wildfires are devastating, but as much press coverage as they get, they tend to be confined to a relatively small portion of the state. The most typical insurance claims tend to be more mundane, the types of claims you would find anywhere else in the country. Here are some of the most common homeowners insurance claims in The Golden State:

Fire and lightning

No matter where a home is located, it's tough to avoid inevitable thunderstorms, complete with lightning. Whether lightning damages a roof or causes a fire, it's one of the most expensive -- and common -- claims made.

Dog bites

A single dog bite costs an average of nearly $45,000 and is another common claim.

Bodily injury

Unless a homeowner lives alone and never allows another person into the home, there's a chance for someone to get hurt on their property. It could be as simple as falling down a few stairs to being in the wrong place at the wrong time when a backyard deck collapses. Bodily injury is a top insurance claim.

Wind and hail

People tend to think of California as surf, sand, and sunshine. But like every other state, California has its fair share of thunderstorms, and thunderstorms result in a large number of wind and hail claims. Any homeowner seeking insurance in the state should make sure wind and hail damage are covered by their policy or spend a little more on a special rider that does provide needed coverage.

Water damage and freezing

Many areas located in higher elevations receive their fair share of ice, snow, and freezing weather conditions. That alone helps explain why water damage and freezing are common claims.

Homeowners insurance coverage options and discounts in California

Purchasing the "perfect" homeowners policy is a matter of paying as little as possible for the highest level of coverage. It's a matter of examining potential coverages and comparing them against costs, including any discounts available. Here, we list both coverage and discount options.

Coverage options

The fact that there is a wide range of coverage options available means homeowners can pick and choose until they find the level of coverage they're most comfortable carrying. They include:

HO-1: The most basic type of policy, HO-1 covers home and personal belongings at actual cash value against typical perils. Some insurance companies no longer offer this type of policy.

HO-2: This policy expands on the HO-1 by offering coverage against more than basic perils. It also includes protection against things like freezing, electrical surges, volcanic eruption, and damage due to the weight of ice, snow, or sleet.

HO-3: The HO-3 policy is one of the most commonly purchased forms of coverage. It covers a homeowner against a wide range of risks, unless otherwise excluded in the policy.

HO-4: Covers renters insurance and does not apply to homeowners.

HO-5: An HO-5 policy introduces some bells and whistles, including replacing home and personal property at replacement cost. It also allows a homeowner to include coverage for valuables like art, jewelry, and electronics.

HO-6: Coverage for condos, including details important to condo owners, like loss assessment coverage.

HO-7: Covers mobile homes, structures not typically covered under a traditional homeowners policy.

HO-8: Typically reserved for older homes that may not meet the requirements for another policy. This could be due to the type of wiring, plumbing, or roofing installed in the house.

Discount options

Each insurer offers its own set of discount options. Here's a sampling of the most common:

• New home construction
• Home and auto bundle
• Advance pay
• Home upgrades
• Home security system
• Company loyalty
• Professional affiliation
• Non-smoker
• Homeowners Association (HOA) membership

5 cheapest cities in California for homeowners insurance

There are several reasons it is more or less expensive to insure a home. It could be due to the crime rate in a city, how near (or far) a house is from a fire station, or might simply be due to the value of homes in a particular area. Here's a list of the five cheapest cities in California for homeowners insurance:

5 most expensive cities in California for homeowners insurance

And here are the five most expensive city in the state for homeowners insurance:

But what if a homeowner can't find insurance or their insurance company declines to renew their policy? In California, they can apply for coverage under the FAIR Plan. The FAIR Plan was established so that every California homeowner has access to basic fire insurance. While it's not meant to be a long-term solution, it's better to have some coverage than none. Homeowners can apply for the FAIR Plan through an insurance agent or by calling (800) 339-4099.