Brad Gerstner, founder of Altimeter Capital, said that California regulators have approved significant auto insurance rate hikes as insurers exit the market, affecting prices nationwide. He expressed his views on X, asserting that price controls will not mitigate inflation.
“It’s no mystery,” said Gerstner. “The CA Dept of Insurance which sets auto rates for 12% of US drivers approved 25-30% rate hikes over last 2 yrs as many insurers left the state due to Prop 103. And bc CA is so big it influences rates across the country. Price setting does not fix inflation…”
California’s insurance market has been under increased scrutiny as the Department of Insurance progresses with reforms to Proposition 103 and manages rate approvals amid insurer withdrawals. In October 2025, Commissioner Ricardo Lara proposed changes to intervenor rules aimed at enhancing transparency. Supporters believe this would expedite reviews, while critics express concerns over potential reduced oversight. The Los Angeles Times reported these reforms occur as companies like State Farm temporarily halt new policies, highlighting market instability.
The state has approved substantial auto-insurance rate increases over the past two years due to post-pandemic losses. The San Francisco Chronicle reported that State Farm received a 17.7% average rate increase in 2025, while S&P Global Market Intelligence noted Allstate’s effective 26.4% increase during 2024. These double-digit hikes represent California’s most significant rate movements in a decade.
Across the United States, private-auto rate changes averaged 16.4% in 2023 and 7.2% through late 2024, with notable variations among states. S&P Global Market Intelligence found Allstate’s highest effective hikes were 35.4% in Nevada, 29.1% in New Jersey, and 26.4% in California, indicating California is near the upper tier but not the peak nationally.
Gerstner is known for his policy commentary and leadership at Altimeter Capital, a Menlo Park-based investment firm focused on technology and growth companies. He has led investments in Uber, Snowflake, and Airbnb and is recognized for his influential letters such as the one urging Meta to cut costs and streamline operations in 2022.
Altimeter Capital Management LP was founded by Gerstner in 2008 as a technology-focused investment firm operating hedge and venture funds with offices in Menlo Park and Boston. The firm partners with visionary founders to scale transformative companies and manages multi-billion-dollar assets under advisory structures registered with the U.S. Securities and Exchange Commission.
