Farmers Insurance has announced the removal of its cap on new California homeowners policies, a decision that takes effect immediately. This move aligns with efforts to encourage insurers to expand their presence in the state. Earlier in 2025, Farmers had increased its limit to 9,500 new customers per month from a previous cap of 7,000, while maintaining its position as California’s second-largest home insurer. The elimination of the cap indicates additional capacity from a major carrier and provides buyers, sellers, and existing homeowners with greater confidence that standard homeowners coverage will be available through a national brand when needed.
“Farmers Insurance just removed its cap on new homeowners policies in California — a major development after years of carriers pulling back or limiting coverage,” said Danny Brown, Self-employed, according to LinkedIn. “While this doesn’t solve the statewide insurance crisis overnight, it does signal a growing willingness from major insurers to re-enter the market. More availability could bring stability to homeowners, buyers, and sellers who have been navigating rising premiums and policy restrictions. I’ll continue monitoring how this shift impacts different Los Angeles neighborhoods and price points.”
According to reports, California’s Sustainable Insurance Strategy is led by Insurance Commissioner Ricardo Lara. It aims to modernize homeowners insurance rules to encourage private insurers to expand coverage, particularly in wildfire-impacted communities. The framework includes commitments from participating companies to write at least 85 percent of their statewide market share in designated underserved areas. This initiative seeks to transition more households from last-resort plans back into the admitted market and broaden consumer options. In 2025, Mercury Insurance filed the state’s first homeowners rate plan based on this strategy, positioning itself for growth in higher-risk zones while offering more comprehensive coverage choices to California homeowners.
Danny Brown, a real estate agent with Compass Realty and Principal of the Luxury Estates Division at Compass in Beverly Hills, commented on Farmers Insurance’s decision: “Farmers Insurance’s decision to lift its cap on new California homeowners policies is a step toward more stable, accessible coverage for buyers and sellers.” Brown has over two decades of experience and more than $1 billion in closed sales volume. He is consistently ranked among the top agents in Los Angeles by the Real Trends + Tom Ferry “The Thousand” list.
Compass is a U.S. residential real estate brokerage and technology company founded in 2012 and headquartered in New York City. Operating across major metropolitan and luxury markets nationwide, it has grown into one of the largest brokerages in the country by sales volume. Compass positions itself as a modern real estate platform that pairs top-producing agents with proprietary marketing, data, and transaction tools to streamline the homebuying and selling experience.
