Jeff Brandes, president of the Florida Policy Project, said California’s low homeowners insurance rates are misleading due to policy exclusions and regulatory interventions.
“California’s “cheap” homeowners insurance is a bit of a shell game. Yes you’ll see $1,300–$1,600 for $300k in coverage. But earthquakes aren’t covered in standard policies. Wildfires are covered but California caps how quickly insurers can adjust rates. The result non-renewals carriers pulling back and more people dumped into the FAIR Plan. When Government gets involved in insurance they typically start pricing politically and not actuarily,” Brandes wrote in a post on X.
He explained that standard policies in California exclude earthquake coverage, which most homeowners do not purchase separately, and that state-imposed rate caps on wildfire coverage have led to insurer nonrenewals and increased reliance on the California FAIR Plan Association.
As of December 2025, the FAIR Plan had 668,609 policies in force with total exposure of $724 billion and cash reserves under $500 million, an increase of 146% since September 2022.
Brandes contrasted California’s market with Florida, where reciprocal insurance exchanges — policyholder-owned entities without outside shareholders — have expanded in hard markets along the Gulf Coast, providing coverage where traditional carriers have withdrawn due to regulatory pressures, according to Insurance Business Magazine.
Reporting by Insurance Resources LLC noted that reinsurance rates in Florida fell 10% to 20% in 2025, with 17 new companies entering the market. Tort reform and a lack of hurricanes contributed to downward pressure on premiums.
Brandes previously served as a Republican state senator and now leads the Florida Policy Project, which researches state-level policy issues, including insurance regulation.
