Safeco, a subsidiary of Liberty Mutual, will exit several smaller insurance lines in California due to increasing market risk and volatility, according to a company spokesperson.
The changes will affect a range of products over the next two years as the insurer adjusts its focus in the state.
While Safeco will continue offering home insurance in California, it will stop writing new policies for condominium, renters, and watercraft insurance beginning in early 2025. The exit will also include certain home insurance products written by other Liberty Mutual subsidiaries.
Starting in 2026, Safeco will cease underwriting new policies for specialty vehicles, motorcycles, and non-good driver (standard) auto products. At the same time, the company will begin non-renewing policies in these lines and others it had already stopped offering to new customers, including Liberty Mutual-branded condo and renters insurance, which were closed to new business in 2023.
“We are building a sustainable business path forward in California by simplifying our product offerings and investing in the areas where we can win in the long term,” the spokesperson said in a report from AM Best.
Safeco plans to focus its California business on core products, including auto, home, landlord, and umbrella insurance.
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Liberty Mutual, which is the fourth-largest homeowners insurance provider in California, said it remains committed to the state’s market. The company views the changes as part of a strategy to create a more sustainable operational model. Many of the lines being discontinued have underperformed over the past decade, the spokesperson said.
The decision comes as California’s property insurance market undergoes significant changes. Farmers Insurance recently announced plans to reopen some property lines previously closed to new business, including homeowners, renters, and condominium policies. Farmers began reopening these lines in stages on Dec. 14.
In an effort to stabilize the state’s property insurance market, the California Department of Insurance is finalizing reforms that began in 2024. These include new rules allowing insurers to incorporate reinsurance costs into their rates if they expand coverage in higher-risk areas. The reforms aim to address market challenges and encourage insurers to increase availability in underserved regions.
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