Know your rates

By law, California insurance companies determine their own rates, subject to approval by the California Department of Insurance (CDI) and since each company's loss rates vary, their prices will vary as well. Be sure to compare rates and coverage when choosing an insurance carrier.

I recommend: When choosing a California home or commercial insurance carrier, consider their different premium financing and payment options as well as discounts they may offer. Compare multiple quotes in minutes with online services or contact established providers like CIG Home Insurance, State Farm or Allstate.

Know what's covered (and what's not) with California property insurance

California house insurance policies normally cover your dwelling, other structures and contents against losses such as fire or lightning, wind or hail, breaking glass, explosion, riots, theft, aircraft and vehicles, smoke and vandalism. It's important to note that earthquake and fire protection are specifically excluded in standard policies. Commercial property insurance covers business personal property, buildings and the personal property of others against either specified perils (a list of specific perils) or open perils (all losses are covered unless specifically excluded) policies.

I recommend: Consult with an experienced California property insurance provider who can explain you options to you. To find reputable agents and brokers in your area, ask for recommendations, consult the California Department of Insurance website or try an online service.

Know your limits

Your policy and the amount it will pay out to replace your home or business is not dictated by the real estate market, but by the cost of labor and building materials. Like with their rates, insurance carriers calculate their coverage limits differently. Your "dwelling" limit should cover the amount it would cost to rebuild your house and "content" limits are usually 50% of the dwelling limit, but your personal possessions should be carefully documented. California commercial property insurance limits, on the other hand, are the estimated amounts to rebuild and replace permanently installed fixtures and equipment in the event of a total loss.

I recommend: Contact local contractors to keep informed of the building costs in your area; refer to Contractors State License Board to find local contractors or online services like Contractors.com.