Allstate plans to stop writing new homeowner's insurance policies in California this summer. Allstate has been the third biggest seller of homeowner's insurance in California, but the company been scaling back on new policies here for the last couple of years.
Allstate had already put new restrictions on insurance for homes near earthquake faults and areas prone to wildfire. Spokesman Rich Halberg says the decision to stop writing new policies is designed to limit risk, so as not to jeopardize Allstate's current customers.
Halberg : Our existing policyholders in California are not affected by this. We're going to continue to renew the property policies of our existing 900-thouand homeowners in California.
California's insurance commissioner calls Allstate's action "short sighted." He notes that other companies like State Farm and Safeco have lowered insurance premiums at a time when Allstate is seeking a rate increase.
In the meantime, state regulators say there should be no shortage of insurance carriers who will write policies here.
