A Homebuyer In Escrow On A $720K House Just Discovered The Insurance Is 'Astronomical.' Realtor Claimed Earlier That It Wouldn't Be An Issue

Adrian Volenik

Sat, Jun 7, 2025, 9:31 AM 4 min read

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A homebuyer in California thought they were on their way to closing on a $720,000 property in a semi-rural area. But after entering escrow, they were hit with a surprise: the insurance quote was between $14,000 and $17,000 per year.

The buyer, who shared their story on Reddit, said they had asked about insurance earlier in the process but were told not to worry. "My realtor claimed it wouldn’t be an issue," the person wrote. "Lesson learned, it takes 10 minutes to run a few quotes on a house before putting an offer."

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The two quotes they received were “astronomical,” $14,000 annually with a $20,000 deductible, or $17,000 annually for a $2,500 deductible. The only option available was California's Fair Access to Insurance Requirements Plan, which many homeowners in high-risk zones are forced to rely on due to the lack of private carriers.

California homeowners and industry pros in the thread pointed to the growing wildfire risk, regulatory delays, and insurance companies pulling out of the state as major reasons for rising premiums.

“Semi-rural California = fire country,” one person wrote. Another said, “Farmers [Insurance] here for 32 years without a single claim. Cancelled.”

An insurance adjuster chimed in: “This is the exact problem. Florida has the same problem in reverse where everyone accounts for the risk of storms. But because everyone just litigates and sues for any and everything it's not worth the risk.”

Others criticized California regulators for blocking or delaying the use of catastrophe models that would allow insurers to price risks more accurately. "The risk is now too great to insure," one commenter wrote.

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Commenters were also critical of the role of real estate agents. "Stop trusting your realtor," one person said. "Their ultimate goal is to get paid fast and move on."

Another warned, "Don't use your realtor's broker. The last two houses I bought, different realtors convinced me to call their engineer, their inspector, their engineer... all those people gave the realtor kickbacks and none had my interest in mind."