Los Angeles County has filed a lawsuit against State Farm that accuses the insurance giant of unfair business practices its handling of claims by policyholders impacted by the January 2025 Eaton and Palisades Fires.
State Farm is California’s largest private insurer, with more than 2.8 million residential and commercial policies statewide. The lawsuit follows County Counsel’s investigation of State Farm relating to its delays, underpayments, and denials of wildfire claims.
Among the allegations raised by the county are false advertising by State Farm that convinced residents they could rely on the insurer; unreasonable delays in the investigation and processing of claims; systematic underpayments of claims even where the rightful amount of the claim was clear; frequent and improper reassignment of individual claim adjusters; and systematic barriers to policyholders’ ability to contact and communicate with adjusters.
The county also accused State Farm of refusing to provide due compensation for additional living expenses; misrepresentations during the claims process to discourage pursuit of claims; and the illegal suppression of smoke damage claims.
“Wildfire survivors have already endured unimaginable loss; they should not have to fight their insurance company simply to receive the benefits they paid for and counted on,” said Los Angeles County Supervisor Kathryn Barger. “These delays, underpayments, and denials have real consequences. They keep families from rebuilding, prolong displacement, and ultimately slow the recovery of entire communities. That is why Los Angeles County is taking action to stand up for survivors and hold State Farm accountable.”
Bob Devereux, a spokesperson, issued a statement in response to the lawsuit that said, “State Farm General strongly disagrees with Los Angeles County’s characterization of our wildfire claims response. We will review the lawsuit and respond through the appropriate legal process. Wildfire survivors deserve support, clear answers, and a fair claims process.”
The new lawsuit follows and enforcement action issued in May by the California Department of Insurance against State Farm. Insurance Commissioner Ricardo Lara announced that action by declaring, “Wildfire survivors came to us for help, and we followed the facts. Our investigation found that State Farm delayed, underpaid, and buried policyholders in red tape at the worst moment of their lives. That is unacceptable, and we are taking decisive action to hold them accountable.”
0 Comments