Insurers Fleeing California Market Want Rate-Hike Flexibility

As property insurers flee California, a state riven by billion-dollar wildfires, mudslides, and the ever-present threat of a catastrophic earthquake, state lawmakers on Wednesday will take up the complex but necessary issue of how to convince the carriers to stay.

The joint hearing of the California Assembly’s Insurance and Emergency Management committees will concentrate on insurance and catastrophe modeling.

The session comes as the state’s geographical, environmental, and political realities combine to create an inflection point compelling carriers, shareholders, regulators, and consumer groups to shore up California’s crumbling market. State Farm General Insurance Co. is the latest insurer to cut coverage in the nation’s disaster-prone most populous state, following Allstate Corp., American International Group Inc., and Chubb Ltd.