California Investigates State Farm Over LA Wildfire Claims Handling

California's Insurance Department has launched an expanded investigation into State Farm's handling of insurance claims related to the January wildfires in Los Angeles County, including the Palisades and Eaton fires. Insurance Commissioner Ricardo Lara highlighted concerns such as delays in payments, multiple reassignments of claims adjusters, inconsistent claim management, and poor record-keeping, which have caused hardship for fire survivors. Survivors and lawmakers have reported difficulties with reimbursement, especially for smoke damage, and the investigation aims to assess whether State Farm complied with consumer-protection laws. In a related legal development, a lawsuit alleges that State Farm deliberately undervalued reconstruction costs by misusing the 360Value estimation software, misleading policyholders about coverage levels and seeking to deny claims using questionnaires post-disaster. State Farm has stated it is cooperating with the investigation and maintains that many customers are satisfied with its claims handling. Advocates and affected residents remain cautious, awaiting results from the regulatory review and legal actions.