California Insurance Code 12959 requires the commissioner to publish and distribute a comparison of insurance rates report for those lines of insurance which are of most interest to individual purchasers of personal lines of coverage.
Annually, the Statistical Analysis Division (SAD) of the California Department of Insurance conducts a survey of premiums of insurers offering homeowners insurance in California. Due to the great diversity of homes, limits, locations and coverages available, it is impossible to publish a comparison for every risk. Therefore, companies are asked to supply their annual premium, based on rates for new business, for specific hypothetical risks located in various Zip codes throughout the state. Zip codes are selected from various regions within the state, based on census home density data. Hypothetical examples are developed in order to provide premiums for a wide variety of risk types.
The homeowners premium survey is based upon several scenarios, or hypothetical risks, that represent the most common variables applied to homeowners, condominium, renters and earthquake insurance premiums quoted today.