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Los Angeles County has filed a lawsuit against State Farm over its handling of insurance claims stemming from the January 2025 Eaton and Palisades fires, alleging that policyholders faced improper delays, inadequate payments and claim denials.
The complaint follows an investigation by the Los Angeles County Counsel’s Office, which reviewed hundreds of complaints and documents from State Farm customers as well as information supplied by wildfire survivor organizations. County officials also said State Farm did not substantially comply with requests for records and information during the investigation.
Among the practices alleged in the lawsuit are repeated changes of claims adjusters, difficulties reaching claims representatives, disputes over additional living expense payments and what the county characterizes as improper handling of smoke-related damage claims.
The county said the consequences have extended beyond financial losses for some displaced residents. Its complaint describes difficulties faced by a 97-year-old policyholder who has been unable to return home while his family continues seeking appropriate testing and living-expense benefits.
State Farm has more than 2.8 million residential and commercial policies in California, making it the state’s largest private insurer, according to the county.
The lawsuit seeks restitution for affected policyholders, court-ordered changes to State Farm’s practices and civil penalties of up to $2,500 for each violation.
The case follows a May 4 examination by the California Department of Insurance. Regulators reviewed 220 randomly selected claims and identified 398 violations of the Unfair Insurance Practices Act and related regulations. The county noted that the state action does not seek restitution, while its lawsuit does.
The image is an illustration created with AI for general context.
Source: Los Angeles County Counsel
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