On beautiful sunny days in California, it often feels like nothing could ever go wrong. And while a disaster hopefully never happens, it’s smart to be prepared. Dedicating just a couple of hours to researching and shopping for home insurance will get you a good deal and the peace of mind that comes with knowing you’re covered.

If you’re looking to learn the basics of homeowners insurance before you start shopping, you’ve come to the right place. Here at Freshome, we’re experts in the home insurance industry. We’ve put together this handy guide to show you how to navigate the murky waters of insurance coverage. You’re well on your way to being a more informed consumer, so read on.

Compare Homeowners Insurance Rates

To quickly find and compare rates in your area, enter your ZIP code below.

Enter Your ZIP Code:


The Best Homeowners Insurance in California

Freshome’s RecommendationsAllstate, Liberty MutualTravelersAmerican FamilyChubbGEICO

Your first step in purchasing home insurance is to gather quotes. You can apply for a quote on most insurance providers’ websites. It takes about 10 minutes and doesn’t affect your credit. Applying for several will give you a better sense of the coverage you need and help you weed out the outliers. Be wary of any insurer that charges significantly more or less than average. It’s possible you’ve found an awesome deal but more likely that the cheapest policy comes with a hidden gap in coverage.

Once you’re finished applying for quotes, narrow down your options and give two or three a phone call. You can get a feel for their customer service, ask questions, and make sure your quotes include similar provisions so you can compare apples to apples.

We applied for a few sample quotes for a small, single-family home in Sacramento worth about $300,000. We opted for a high deductible and no earthquake coverage for this experiment, although depending on where you live, you might need to add it on. We’ll discuss earthquake coverage in more detail later, but as a general rule, it would have raised our quotes about $1,000 a year.

Each insurer looks at different factors when providing a quote, so you might find that your results look quite different than ours. Our most expensive quote could be your cheapest, and vice versa. So use our quotes as a general range, and apply for personalized quotes when it’s time.

Our Quotes
Liberty Mutual $754 per year
State Farm $758 per year
Amica $1,089 per year

Getting a quote for homeowners insurance is free, quick, and relatively simple, so there’s no reason not to gather as many as you can. After all, the best way to ensure you’re getting a good deal is to have a lot of options. We’ve gone ahead and vetted a few more respected players in the industry. Since it’s important for an insurance provider to have high customer service ratings and an excellent financial outlook, we only included companies with good scores from J.D. Power and A.M Best, and stable fiscal ratings from both Moody’s and Standard & Poor’s. This list is a great place to start when you begin your search.

What You Should Know Before Getting a Quote

How do California’s rates compare?

The average Californian pays about $966 per year in home insurance premiums. That’s nearly 12 percent lower than what most Americans pay — $1,096. While that savings might sound appealing, one of the biggest risks to your home is typically excluded from your insurance policy. So don’t forget to factor in the cost of separate earthquake coverage when budgeting for homeowners insurance.

California is a big state, and different regions are subject to different types of home damage, so you may see quite a bit of price variation depending on where you live and the natural disasters your area is prone to.

What do I need to prepare?

When it’s time to start your search and gather quotes, keep your home’s listing sheet handy. It’ll be packed with information about your home that you may not know off the top of your head. The questions you’ll be asked are all over the place. Do you plan to have a fire extinguisher in your new home? Will you install deadbolt locks? How far is the nearest police station? What is your roof made of?

You might not know the answer to every question right away, so give it your best guess, and then revise your quote on the phone when you narrow down your choices and start making calls. Once you’ve settled in with an insurance provider, remember to keep them updated with any changes to your property or neighborhood that could affect your policy.

How much should my deductible be?

If you can afford a high out-of-pocket cost in the event of an emergency, it will likely save you money in the long run, since rates are lower for high-deductible plans. Another reason a high-deductible is a smart choice — and this may sound counterintuitive — is because it discourages you from filing a claim on your insurance. Let’s say a storm causes $2,500 worth of damage to your roof, but your deductible is $3,000. It might not be worth it to ask your insurance to pay that extra $500, since filing too many claims will raise your rates and could even get your policy canceled. It may not seem fair that you’re punished for actually using your insurance, but unfortunately, that’s the way it goes.

If you don’t think you’ll have several thousand dollars on hand in case of a major home disaster, it’s okay to choose a lower deductible and pay a bit more monthly or annually. You can discuss exactly how raising or lowering your deductible will impact your rate when you start making phone calls to insurers.

How much insurance do I need?

Your insurance should cover the amount it would take to completely rebuild your home in the event of catastrophic damage. That isn’t always the same number as the value of your home. If you live on an expansive and valuable property, it may be less, and if your home is made with special materials or has recent updates, it may be more. Take this advice from John Bodrozic, Co-Founder of HomeZada.com.

“Check the amount to rebuild your home if a disaster destroyed it. Many people have done large home improvement projects but have not updated the coverage to rebuild the home taking into account the amount of the remodels.”

Does my credit score make a difference?

For almost everyone else in the country, yes. Luckily, you live in California. It’s one of the few states that outlaws the practice of raising insurance rates due to a low credit score. In many other states, a minor drop in your credit rating from “Excellent” to “Fair” would mean a major hike in your rates — some folks pay up to 65 percent more. But in the Golden State, you won’t be punished for a less-than-ideal score.

What else does homeowners insurance cover?

Your home insurance will include liability protection, which pays the bills if you are sued for a situation like your dog biting the mail carrier, or your child damaging a neighbor’s property. Your policy will also pay a portion of the medical bills of anyone injured in your home.

Just because you take your valuables out of your house, it doesn’t mean they’re no longer protected under your insurance. List items like fine jewelry and expensive luggage specifically on your policy, so that if they ever go missing or are damaged on-the-go, you’ll be able to recoup expenses.

Most homeowners insurance also includes coverage for ALE, or Alternate Living Expenses. This means that if your house is too damaged to live in, your insurer will foot the bill for a temporary hotel stay or home rental.

Compare Homeowners Insurance Rates

To quickly find and compare rates in your area, enter your ZIP code below.

Enter Your ZIP Code:



What type of policy should I look for?

Most insurance providers will default to an HO3 policy, which is exactly what you want. HO3 means that if there’s a gap in your coverage, you’ll know about it. Your policy will come with a specific list of exemptions, so you can be prepared for any situations that aren’t included in your insurance, in case you need to seek coverage elsewhere.

Other types of policies list several covered circumstances, and leave the rest a mystery. So HO3 is your best bet for transparent insurance coverage that won’t leave you with a surprise exclusion.

What are some common coverage gaps?

Water backup/sump pump overflow is almost never included in your insurance coverage, but you can add it on for a small fee. This is a common cause of home damage, so if the cost is reasonable, you may want to consider including it.

When we asked John Bodrozic of HomeZada.com about gaps in coverage, he had this to say:

“Special coverage for collectible items. Even if you have enough content coverage, often times a basic policy has limits or excludes valuable items such as collectibles such as art, wine, coins, rugs, china, silverware, etc. Make sure you take a home inventory of these things and get a special rider to make sure you are covered.”

And remember that a home insurance policy is not the same as a home warranty. Home warranties cover things like bad wiring and issues with plumbing. If you’d like some more clarification on home warranties, check out this helpful guide.

How do I get flood and earthquake insurance?

Both floods and earthquakes are not covered by your homeowner’s insurance provider. Flood insurance can be acquired through an agent working with the federal government, and if you live in a floodplain, you’ll be legally required to purchase it. You can opt to buy it even if you don’t live in a flood-prone area, so talk to your real estate agent to assess your risk.

While you can purchase earthquake insurance as an optional add-on from most providers, it’s technically underwritten by the state:

“The California Earthquake Authority (CEA) provides most earthquake insurance in California. The CEA offers several basic policies, including a new Homeowners Choice policy. You cannot buy earthquake insurance directly from the CEA. But you can buy it from insurance companies that are members of CEA.” – California Department of Insurance

Note that if an earthquake causes a fire in your home, you’ll still be covered by your regular insurance policy, even if you didn’t opt for separate earthquake coverage.

What can I do to lower my premium?

Let’s start with what variables could raise the amount you owe for home insurance in California. Some of these may be worth the extra cost or beyond your control, but keep them in mind when you’re comparing quotes:

  • Family pets
  • Swimming pool
  • Trampoline
  • Playground/yard equipment
  • Smoking
  • Prior claims on your home insurance

There are a few things that will almost always lower your premium, and most are relatively simple. Extra security measures will not only lower your rate, they’ll lower your risk, so they’re smart to consider:

  • Deadbolt locks
  • Smoke detectors
  • Burglar alarm
  • Fire extinguishers
  • Indoor sprinkler system
  • LEED certified construction
  • Bundling home insurance with auto/other insurance
  • Paying annually instead of monthly

Take Action

California is no stranger to natural disasters, so it’s extra important that your home is covered by a rock solid homeowners insurance policy. Remember that for floods and earthquakes, you’ll need to secure separate policies, so talk to a real estate professional about the recommended coverage in your area.

The insurance world can be an intimidating place, but now that you know a lot more about how it works, you’re ready to tackle the tricky language and tough questions you’ll encounter when shopping for a new provider. The first step is applying for plenty of quotes, so go ahead and dive in with some of the insurers we’ve already vetted.

Freshome’s RecommendationsAllstate, Liberty MutualTravelersAmerican FamilyChubbGEICO

Compare Homeowners Insurance Rates

To quickly find and compare rates in your area, enter your ZIP code below.

Enter Your ZIP Code: