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State Farm announced Friday that it will not take new applications for personal line or business property and casualty insurance in the state of California.
The risk of catastrophes such as wildfires, floods, and earthquakes, as well as spikes in construction costs, led State Farm to stop taking California insurance applications. The new policy takes effect Saturday.
“State Farm General Insurance Company made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market,” the company wrote in a statement.
