➡ State Farm, a major insurance provider, has announced it will not renew 72,000 policies in California, causing concern for homeowners. This decision is due to rising costs and increased disaster risks. The company has also requested to raise its rates significantly, which could further impact homeowners and renters. This situation is causing a crisis in the California insurance industry, potentially leading to a mass exodus of insurance providers and financial strain on the state’s insurer of last resort.
➡ The article suggests that real estate prices are set to skyrocket, which could be a great opportunity for those who are prepared. Despite current challenges, the author believes that brighter times are ahead and those who are ready could benefit greatly. The author also expresses a negative opinion about Gavin Newsom.

State Farm has just told Gavin Newsom that it is over. State Farm has just issued an ultimatum that is so mind-blowing. If you aren’t sitting back and waiting to watch the devastation in the California real estate market, you’re gonna really be missing out. Now, State Farm, as of March this last year, announced that it was not going to renew 72,000 insurance policies in California alone, which will devastate many homeowners. As a matter of fact, so many homeowners in California have seen prices skyrocket in the last couple of years, and it is about to get much worse.

Let me know down below if you are seeing not only State Farm, but your homeowners insurance explode in California. And let’s dive into this story. This is out of the San Francisco Standard entitled, State Farm seeks seismic level rate hike as insurance crisis becomes the perfect storm. I have to tell you, I know homeowners in California that are seeing prices increase so drastically, not just in insurance, but even in electrical costs. I have seen people that have had solar systems for the past 12-13 years go from not paying anything each year in a true-up to just this last year I spoke to a homeowner that I know personally that pays $1,400 more than he did just a few years ago per year.

That’s having a full-blown solar system on their house for 12 to 13 years. Homeowners are getting squeezed, and if you do not believe that these homeowners are about to start racing for the exits, selling their homes, selling rentals that aren’t cash flowing, all kinds of problems, and this is going to spell massive problems for the party that Gavin Newsom is a part of. Why? Because this insurance crisis is so big it is going to cause a massive black hole, a sucking sound. You can already hear it in the budget of California.

So check this out. It says mere months after its last rate increases went into effect, California’s largest insurance provider is asking for another huge hike. Earlier this week, State Farm California’s subsidiary submitted a request to the Department of Insurance to raise its rates by an average of 30% for homeowners, 52% for renters, and 36% for condo owners. This marks the latest escalation of the California home insurance crisis, which has seen a slew of insurance providers issuing dramatic rate increases, halting new policies, or leaving the state entirely. Let me stop and remind you that Gavin Newsom has been trying his hardest and the Democrats in California to stop these rate increases, so they put these chains, these shackles on the insurance company to say you are not allowed to raise rates a certain amount in a certain amount of time, and the insurance companies are all fine.

We’re a for-profit company. You don’t pay us to stick around. We’re leaving. The cost of rebuilding a home right now because of the massive inflation wave that has been created by the federal government, state governments, and the Federal Reserve, which are all three different entities, has seen home rebuild prices go up over 30%. Now it says here, insurance industry experts have described the state of California’s insurance industry as a ticking time bomb with a mass exodus of carriers severely straining the state’s insurer of last resort, which only provides bare-bone coverage.

At the end of this video, I’m going to show you how you’re able to make a ton of money from this situation. So State Farm itself stopped issuing new homeowners policies last year and left people scrambling when it announced in March that it would not renew roughly 70,000 existing policies, citing inflation and increased disaster risks. Shortly afterwards, a credit rating agency for insurance companies, AM Best, downgraded State Farm’s financial outlook to negative. The proposed new increase amounts to another seismic level rate premium shock, said Joel Launcher, program specialist at United Policyholders, which is a San Francisco-based nonprofit.

If granted, the rate increase, State Farm’s latest rate hike would take effect when people renew their policies in 2025. Now remember, I cited here earlier, back in March, it was announced that State Farm wouldn’t renew 72,000 insurance policies in California. And the first big wave of that starts this month. All right, so you’ve got people in California this month, thousands, tens of thousands of them that are not going to be renewed. So they’re going to have to go somewhere else. Now, I know someone personally had just bought a house up in the Sierra Nevadas of California, and they cannot get insurance.

They purchased their home, they can’t get insurance. They paid cash, successful people. So right, they saved up, they paid cash. They don’t have insurance, and they live, that house is in the middle of a forest, right? Ready to rock and roll if there’s a fire. So they said they’re going to be forced to go to the state’s program. They’re not going to be able to really shop around, it looks like, and the state’s going to accept them. Here’s the problem. That state-funded or state-backed insurance is going to be running in the negative.

It is a loss, okay? This summer, that state insurance company is going to have its greatest test, and that is, during wildfire season, how many policyholders are going to be contacting them and saying, we need a new house now. And so that is going to be a part of California’s budget that’s going to suck into a black hole. Now, it says the Department of Insurance, which is charged with evaluating rate increase requests, said that in a statement that it has serious questions about the request and plans to investigate State Farm’s financial situation using all of its investigation tools.

State Farm has a loss ratio of nearly 90% in California last year, meaning it paid out about $90 for every $100 it collected in premiums. The overall market in California has a loss ratio of 68%. Now, as all of this is happening, we’re right in the middle of fire season, right? I was a career firefighter for 23 years. I understand this pretty darn well, and it’s going to be interesting because as all this is happening, the ultimatum from State Farm to Gavin Newsom, we’re seeing other insurance companies walk away from the state of California.

You’re going to have all the news of wildfires destroying homes, and it is going to actually, it’s like just kindling, ready to rock and roll in the news media. And this isn’t good if you think about it coming from the Democratic side of them trying to figure out who’s going to be the next president, who’s going to come in for the next governor of California. It doesn’t bode well, and you’re going to see insurance companies, and I don’t blame them, they’re for profit, right? And if they aren’t making enough profit, because I’m sure that the government’s going to spin this and saying, hey, you’re at 90% loss ratio, you’re still making money.

They’re going to be out of here, and it is going to put such a strain on the California insurance company that’s backed up by the money from this. You know, in 2005, when I was selling homes and liquidating everything I had because I saw that crash coming, I wasn’t sitting here dealing, we weren’t dealing with a massive insurance crisis. Sure, there’s wildfires every summer, homes burned down. It’s, you know, people don’t think and they stack their wood pile right up against the house. Sure, they don’t take care of their home.

All of a sudden, they’re like, hey, there’s a fire down the street, come save my home. I didn’t think ahead. This happens every year, right? But last time this happened during the Great Recession, and people started bailing, mortgage rates were the exact same as they were now. But we didn’t have national inflation affecting our energy costs skyrocketing, our food costs skyrocketing, serious turmoil in the government, like very serious, right? To say this election is very important is an understatement, right? It’s the understatement of the century, type two, if you agree.

My point being is that we are in a moment that is so much worse. We didn’t have insurance companies bailing. Patience is going to be the greatest virtue. And if you will just set aside some money, get your debt to income ratios set up a lot better, pay some debt down, pay the right debt down, sit back and become a prime borrower, sit back and know that you’ve done all the work now, and you’re just having an Airbnb crisis back then where a bunch of homes are bought up and cause real estate to explode in price.

And then all of a sudden, people are going, Oh, crap, these things aren’t penciling out. We didn’t have a commercial mortgage backed security crisis. We’ve already seen more money lost last year in the bank failure 2023 than what was lost in 2008 combined. Oh, yeah. And guess what else? The federal government wasn’t printing a trillion dollars every 90 days to keep that bubble afloat. Wall bubbles get so big to where they eventually pop. And that popping has already happened. And you’re going to see the facts come out after the election because what’s happening is akin to a mini hyperinflation that’s headed your way.

And the one thing that’s not going to hyperinflate this time is real estate prices. And that’s where people need to get ready and get on the sideline type three, if you’re one of those people that are getting ready, and I want you to get ready for this. This is really exciting times. Remember, you can’t see light without there being a ton of darkness. And right now, I’ve been paying attention to a little dark out there, which means the light is getting brighter, the light at the end of the tunnel is coming.

And for those of you that are prepared, you’re going to be rewarded massively. Hope you got something out of this. Can’t wait to watch how well we already know this one’s gonna go. And Gavin Newsom is just looking like a total turd type four. If you agree with that, hope you hopefully have a great day or actually just hashtag Gavin Newsom’s a turd. The economic ninja is out. [tr:trw].

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