Is your insurance renewal safe? Expert tips from Stan Dreckman show landlords how to stay covered in California’s volatile market.
Rising premiums. Stricter requirements. A shrinking pool of carriers. For California housing providers, insurance has become one of the toughest challenges of property ownership today.
The Current State of California’s Insurance Market
The biggest theme of the presentation: instability.
- Fewer carriers are willing to insure multifamily properties in California.
- Older infrastructure (especially outdated electrical systems) often triggers steep premium hikes or non-renewals.
- Wildfire exposure and climate risks are leading insurers to limit coverage.
- Regulatory pressures, particularly Proposition 103, add further complexity by requiring strict rate approvals that discourage insurers from expanding in high-risk regions.
Shifts in Insurance Company Strategies
Rather than competing for business, many carriers are shrinking their portfolios and tightening renewal requirements the noted common trends are:
- Pulling out of entire regions
- Requiring costly upgrades (new electrical panels, roofing, habitability improvements) before renewal
- Increasing deductibles while lowering coverage limits
For landlords, this means renewals are no longer routine, each year can bring unexpected challenges.
Coverage Categories Every Housing Provider Should Know
These are the core policies housing providers should understand:
- Property Insurance – Covers physical building damage
- General Liability – Protects against injury or damage claims from tenants or visitors
- Loss of Rents – Maintains cash flow when units become uninhabitable after a covered event
- Umbrella Policies – Extends liability protection beyond standard coverage limits
It's Also important to highlight the role of reinsurance. Insurance for insurers. When global reinsurance costs rise, those increases inevitably filter down to California property owners.
Emerging Challenges
Beyond rising premiums, specific pain points are making coverage harder to secure:
- Electrical systems: Outdated wiring remains a major liability.
- Habitability claims: Lawsuits tied to California’s strict standards are pushing carriers to be more cautious.
- Wildfire exposure: Even urban properties are being scrutinized for regional fire risks.
Practical Recommendations from Stan
With more than 20 years of experience, Dreckman unpacked the reality of today’s insurance climate: carriers pulling back, rates climbing, and stricter renewal demands that are catching many property owners by surprise. Dreckman encouraged housing providers to be proactive and strategic:
- Invest in Property Upgrades – Replace outdated systems and address deferred maintenance.
- Stay Ahead of Renewals – Begin discussions with brokers well before policy expiration.
- Work with Specialists – Partner with brokers experienced in California multifamily housing.
- Document Everything – Keep maintenance records, inspection logs, and proof of upgrades.
- Consider Higher Deductibles – Sometimes this reduces premiums without sacrificing essential coverage.
Why Professional Management Matters
Insurers look more favorably on properties that are well-documented and professionally managed. Even smaller owners can reduce risk by adopting professional-style recordkeeping and proactive maintenance strategies.
“In today’s market, securing insurance isn’t just about paying the premium — it’s about proving you’re a low-risk property owner.”
— Stan Dreckman, Huggins-Dreckman Insurance
5 Ways to Prepare for Your Next Renewal
✔️ Inspect and upgrade electrical systems
✔️ Keep updated records of repairs and maintenance
✔️ Start renewal discussions early — don’t wait until expiration
✔️ Ask your broker about coverage limits and deductibles
✔️ Explore multiple carriers, but work with multifamily specialists
For support navigating rising premiums, stricter requirements, and complex renewals, contact AACSC. Our team is here to provide trusted resources and connect you with experts to help protect your investments.