Kate Sanchez of the California State Assembly said on March 19 that she introduced AB 1620 to allow California homeowners a full state income tax deduction on insurance premiums for their primary residence, effective from the 2026 tax year through 2031.
The proposal comes as many Californians face rising homeowner insurance costs and limited coverage options. The bill aims to provide financial relief to residents struggling with these increases.
“Homeowners across California are getting squeezed by skyrocketing insurance costs and Sacramento isn’t making it easier. I introduced AB1620 to deliver real relief: a full state tax deduction for homeowners’ insurance premiums. Lower costs. Protect homeownership. Keep families in California. For many seniors and families, this is the difference between staying in their home or being forced out,” Sanchez said, according to her X account. She said AB 1620 would allow California homeowners to deduct the full cost of their primary residence insurance premiums from state income taxes. The bill applies to taxable years beginning Jan. 1, 2026, through Dec. 31, 2030, and has been referred to the Appropriations Committee’s suspense file after being heard by the Assembly Committee on Revenue and Taxation.
California’s FAIR Plan, which provides insurance for homes that private carriers won’t cover, reached 668,609 policies at the end of 2025—a 43% increase from September 2024—highlighting how many homeowners are facing higher premiums and limited coverage options, reinforcing the need for relief measures like AB 1620, according to Insurance Business Magazine. The number of active FAIR Plan policies has more than quadrupled since September 2019. The plan filed a request to raise rates by an average of 35.8%, its largest proposed increase in at least seven years; some policyholders could face increases exceeding 300%. The FAIR Plan currently writes nearly 10% of all residential policies in California and can only provide fire-only coverage, requiring homeowners to purchase a separate policy to cover other damage, as reported by ABC10.
Kin, a digital home insurer that recently launched statewide in California, sold nearly 3,000 policies in its first three months and generated $5.3 million in premiums; the company reported strong growth in 2025 amid rising demand for homeowners insurance as costs continue to climb, according to PR Newswire.
Sanchez was elected to the California State Assembly in November 2022 representing the 71st District—which includes Temecula, Murrieta, Mission Viejo, Rancho Santa Margarita, and Wildomar—and serves as vice chair of the Appropriations Committee while sitting on several other committees including Government Organization and Health; she earned a B.A. with a concentration in political science and law from Salve Regina University and previously served as executive director of the California Women’s Leadership Association.
