Los Angeles County sues State Farm over wildfire claims handling
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Los Angeles County sued State Farm on Monday, accusing the largest U.S. home insurer of mishandling claims from the January 2025 southern California wildfires. The lawsuit seeks restitution for policyholders and civil fines. State Farm said it has paid over $6.2 billion on wildfire claims and denies systematic mishandling.
Key Facts
- The lawsuit was filed in Los Angeles County Superior Court on Monday.
- State Farm has paid in excess of $6.2 billion on wildfire claims, including about $1 billion for smoke-related damage.
- The January 2025 wildfires killed at least 31 people and destroyed or damaged more than 16,000 structures.
- In May, California Insurance Commissioner Ricardo Lara sought millions of dollars in penalties from State Farm after an investigation found widespread mishandling of claims.
The Lawsuit
Los Angeles County accused State Farm of mishandling claims worse than any other insurer, including failing to pay benefits, lowballing loss estimates, bouncing policyholders between adjusters, and pressuring residents of contaminated homes to return. The complaint seeks restitution for people whose homes were damaged or destroyed in Pacific Palisades, Altadena, and nearby communities, as well as civil fines. The lawsuit quotes State Farm's own promises of prompt, reliable claims service and industry-leading catastrophe response, then alleges that the insurer's failures prolonged the catastrophe for many policyholders.
State Farm Response
State Farm, based in Bloomington, Illinois, denied systematically mishandling or underpaying claims. The insurer said it strongly disagrees with the county's characterization and will respond through the legal process. State Farm reported paying over $6.2 billion on claims for homes, vehicles, and property, including about $1 billion for smoke-related damage.
Regulatory Pressure
In May, California Insurance Commissioner Ricardo Lara sought millions of dollars in penalties from State Farm, the largest amount following a wildfire this century. Lara's investigation found widespread mishandling of claims, and sanctions could include a one-year suspension of State Farm's license in California. The wildfires killed at least 31 people and destroyed or damaged more than 16,000 structures, charring an area larger than Paris.
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