California Regulators Urge State Farm to Expand Coverage Amid 22% Rate Hike Proposal

California's top insurance regulator, Commissioner Ricardo Lara, is set to decide within two weeks on State Farm's request for significant rate hikes, including a 22% increase for homeowners and up to 38% for rental units, to recover from estimated losses of $7.6 billion due to the Los Angeles wildfires. The insurer argues that the increases are necessary for financial stability and to cover payouts, despite facing scrutiny from Lara and consumer advocacy groups. Consumer Watchdog has challenged the necessity of the hikes, demanding justification based on actuarial data. State Farm General has reportedly paid out over $1.75 billion to wildfire claims so far, yet its financial condition remains precarious, prompting concerns about a potential downgrade from credit rating agencies. Lara has emphasized the need for guarantees from State Farm regarding its commitment to continue providing coverage in California if the rate hikes are approved. The outcome of the meeting will influence the future of insurance costs for over a million homeowners in the state.