Farmers Insurance announced yesterday that the California Department of Insurance has approved the insurer’s introduction of a new homeowners insurance rating plan, including elements from Insurance Commissioner Ricardo Lara’s Sustainable Insurance Strategy.

Strengthening its commitment to the Golden State, Farmers said that the rating plan, effective Sept. 15, 2026, will include a significantly enhanced home/auto bundling discount—rising to 22% from 15% previously—as well as unspecified savings for homeowners who implement various residential wildfire mitigation measures.

The plan applies to new and existing customers with Smart Plan Home or Next Generation Home policies.

According to Farmers, the new homeowners insurance rating plan will adjust rates upwards by a statewide average of 1.5%, but new or existing customers who choose to bundle will generally see their rates drop, in general.

“We continue to see encouraging signs that the California insurance marketplace is strengthening and we want to be well-positioned to grow and provide improved coverage offerings to California consumers,” said Behram Dinshaw, president of personal lines for Farmers Insurance, in a media statement. “Together, our new homeowners and auto rating plans provide consumers with multiple opportunities to save, especially through increased discounts for bundling policies.”

In addition to the homeowners rating plan, Farmers indicated that it will introduce a new auto insurance rating plan that will also include robust discounts and improved coverage options, effective July 1.

With the newly approved homeowners rating plan incorporating key elements of CDI’s Sustainable Insurance Strategy, Farmers said it expects to add several thousand new policies in the next two years in areas that CDI has identified as distressed. “Since earlier this year, Farmers has begun reaching out to homeowners in distressed communities and has observed nearly a 10% year-over-year increase in new business writings within these areas,” Farmers said.

Said Dinshaw, “Farmers is proud to be one of the few home insurers that never stopped offering new home policies in the state and we remain committed to the California marketplace. It’s also important to note that we have been able to stay in the market and continue to serve our customers because key stakeholders, including the California Department of Insurance, have remained steadfast in working toward meaningful solutions to reinvigorate the state’s insurance marketplace.”

The Farmers statement notes that customers will be required to meet all applicable underwriting guidelines to be considered for coverage and encourages consumers to reaching out to local Farmers agency owners to learn about the new coverage offerings and available discounts.

Separately, Commissioner Lara flagged the Farmers announcement in a LinkedIn post, hailing the move by the state’s second-largest homeowners insurer as “a significant step forward under the Sustainable Insurance Strategy.” Lara lauded Farmers for reaching out and securing the reported 10% growth in business in distressed areas in advance of the Sept. 15 effective date, also citing a market expansion goal to reach at least 300,000 California homeowners.

According to Lara, Farmers is the ninth major insurer group to receive approval under the SIS, “signaling a shift toward a more resilient and accessible insurance landscape in California.”

Source: Farmers Insurance