ABC News Affiliate
State Farm, California’s largest home insurer, has received emergency approval to increase insurance rates starting June 1, following a judge’s recommendation and a conditional greenlight from Insurance Commissioner Ricardo Lara. This marks the first time an insurer in the state has been granted such approval on an emergency interim basis.

State Farm requested the hikes earlier this year, citing financial distress and over \$7 billion in expected claims from the January Los Angeles County wildfires. The Department of Insurance initially recommended approval, but Commissioner Lara sought additional financial information and asked whether the company could receive help from its parent, State Farm Mutual.

Ultimately, Administrative Law Judge Karl-Fredric Seligman ruled in favor of the hikes after a public hearing, describing them as “a fundamentally fair, adequate, and necessary measure” to stabilize the company. Commissioner Lara adopted the ruling, allowing the company to raise:

* Homeowners insurance by 17%
* Renters and condo policies by 15%
* Rental dwelling coverage by 38%

Lara stated the rate hikes are a necessary step to protect both policyholders and the broader insurance market, though he noted the company must still fully justify the increases in a formal rate hearing later this year.

**Consumer Pushback**

Consumer advocacy group Consumer Watchdog criticized the decision, claiming it violates Proposition 103, which requires insurers to prove rate hikes are justified before implementation. Executive Director Carmen Balber called it a "great disappointment for consumers."

Concerns have also been raised about State Farm’s handling of fire-related claims. Survivors and lawmakers have accused the company of delays and denials. Commissioner Lara emphasized that the rate decision is separate from those complaints, although he pledged to ensure that claims are handled fairly and did not rule out a formal investigation.

Joy Chen of the Eaton Fire Survivors Network warned the move sets a troubling precedent, signaling to consumers that they may not be supported when disaster strikes despite paying premiums.

**State Farm's Response**

State Farm spokesperson Sevag Sarkissian defended the company’s efforts, noting they deployed the largest claims team in the industry. CEO Dan Krause said less than 3% of the 10,000+ fire-related claims have received complaints. He also responded to Lara’s inquiry about increasing contents coverage, declining a boost from 65% to 75% without requiring itemized inventories.

As part of the emergency approval, State Farm agreed to:

* Secure a \$400 million surplus loan from its parent company
* Stop canceling homeowner policies through the end of 2025
* Refund customers if final approved rates are lower than interim rates

A full rate hearing, initially expected in June, may be postponed until October to give all parties time to prepare. Judge Seligman stressed that such hearings are vital to ensure emergency rate hike requests are subjected to rigorous evaluation.

Despite the controversy, both the Insurance Department and State Farm argue that allowing the rate hikes helps prevent further financial instability and ensures insurance availability for over a million homeowners in the state.

State Farm, California’s largest home insurer, has received emergency approval to increase insurance rates starting June 1, following a judge’s recommendation and a conditional greenlight from Insurance Commissioner Ricardo Lara. This marks the first time an insurer in the state has been granted such approval on an emergency interim basis.

State Farm requested the hikes earlier this year, citing financial distress and over $7 billion in expected claims from the January Los Angeles County wildfires. The Department of Insurance initially recommended approval, but Commissioner Lara sought additional financial information and asked whether the company could receive help from its parent, State Farm Mutual.

Ultimately, Administrative Law Judge Karl-Fredric Seligman ruled in favor of the hikes after a public hearing, describing them as “a fundamentally fair, adequate, and necessary measure” to stabilize the company. Commissioner Lara adopted the ruling, allowing the company to raise:

* Homeowners insurance by 17%
* Renters and condo policies by 15%
* Rental dwelling coverage by 38%

Lara stated the rate hikes are a necessary step to protect both policyholders and the broader insurance market, though he noted the company must still fully justify the increases in a formal rate hearing later this year.

**Consumer Pushback**

Consumer advocacy group Consumer Watchdog criticized the decision, claiming it violates Proposition 103, which requires insurers to prove rate hikes are justified before implementation. Executive Director Carmen Balber called it a "great disappointment for consumers."

Concerns have also been raised about State Farm’s handling of fire-related claims. Survivors and lawmakers have accused the company of delays and denials. Commissioner Lara emphasized that the rate decision is separate from those complaints, although he pledged to ensure that claims are handled fairly and did not rule out a formal investigation.

Joy Chen of the Eaton Fire Survivors Network warned the move sets a troubling precedent, signaling to consumers that they may not be supported when disaster strikes despite paying premiums.

**State Farm's Response**

State Farm spokesperson Sevag Sarkissian defended the company’s efforts, noting they deployed the largest claims team in the industry. CEO Dan Krause said less than 3% of the 10,000+ fire-related claims have received complaints. He also responded to Lara’s inquiry about increasing contents coverage, declining a boost from 65% to 75% without requiring itemized inventories.

As part of the emergency approval, State Farm agreed to:

* Secure a $400 million surplus loan from its parent company
* Stop canceling homeowner policies through the end of 2025
* Refund customers if final approved rates are lower than interim rates

A full rate hearing, initially expected in June, may be postponed until October to give all parties time to prepare. Judge Seligman stressed that such hearings are vital to ensure emergency rate hike requests are subjected to rigorous evaluation.

Despite the controversy, both the Insurance Department and State Farm argue that allowing the rate hikes helps prevent further financial instability and ensures insurance availability for over a million homeowners in the state.

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YouTube Video UExiOHFwN0VORVJITFJBYnZNb0JEcUlGUnF2NWlpLXdsRC41QUZGQTY5OTE4QTREQUU4

State Farm wins first-ever emergency rate hike in California

Insurance Hour May 16, 2025 1:01 am

State Farm is asking to increase its insurance rates after January's devastating wildfires in Los Angeles. The company and the California Department of Insurance appeared in a hearing to address the issue Tuesday.

In an hours long hearing, State Farm asked a judge to recommend the California Department of Insurance Commissioner approve its request for a rate hike.

"No insurer can stay in business that pays more in claims than it collects in premiums year after year," said Kathryn Wellington with State Farm General.

State Farm has come to an agreement with the Department of Insurance that it would request a 17% rate increase instead of its original 22%, and says this would come at no risk to policyholders.

"The interim rate poses no risk to policyholders because if the final rate ends up being lower than the interim rate, policyholders will be entitled to a refund of the difference with interest," said Wellington.

State Farm says if the Insurance Commissioner approves this rate hike, it expects to get an additional $400 million.

"The combination of the interim rate increase, plus the $400 million in surplus note from the parent will immediately improve State Farm General's financial condition," said Nikki McKennedy with the Department of Insurance.

The Department of Insurance is also urging a judge to recommend the commissioner approve the rate increase. 

Meanwhile, Consumer Watchdog, a group advocating for rate payers, says it understands it's a difficult time for the insurance market in California but believes State Farm hasn't justified its request.

"We urge the court to not let this hearing become a bailout for bad business decisions," said William Pletcher with Consumer Watchdog.

He adds refunds would not protect the policyholder.

"Refunds are not a substitute for legalities. They're not a permission slip to charge unlawful rates today to maybe correct them after," said Pletcher.

Understanding this would hurt homeowners, insurance experts say this was bound to happen given the state of the market.

"This could be $400 out of their pocket or $600, which is true, but it's better than not having a policy. This is math. This is not politics. This is not anything other than we need to be sure that the carriers have money to pay the claims," said insurance expert Karl Susman.
This hearing could last until Thursday. State Farm has witnesses ready to testify on its behalf and once again, the judge is only allowed to recommend a decision to the Insurance Commissioner.

State Farm is asking to increase its insurance rates after January's devastating wildfires in Los Angeles. The company and the California Department of Insurance appeared in a hearing to address the issue Tuesday.

In an hours long hearing, State Farm asked a judge to recommend the California Department of Insurance Commissioner approve its request for a rate hike.

"No insurer can stay in business that pays more in claims than it collects in premiums year after year," said Kathryn Wellington with State Farm General.

State Farm has come to an agreement with the Department of Insurance that it would request a 17% rate increase instead of its original 22%, and says this would come at no risk to policyholders.

"The interim rate poses no risk to policyholders because if the final rate ends up being lower than the interim rate, policyholders will be entitled to a refund of the difference with interest," said Wellington.

State Farm says if the Insurance Commissioner approves this rate hike, it expects to get an additional $400 million.

"The combination of the interim rate increase, plus the $400 million in surplus note from the parent will immediately improve State Farm General's financial condition," said Nikki McKennedy with the Department of Insurance.

The Department of Insurance is also urging a judge to recommend the commissioner approve the rate increase.

Meanwhile, Consumer Watchdog, a group advocating for rate payers, says it understands it's a difficult time for the insurance market in California but believes State Farm hasn't justified its request.

"We urge the court to not let this hearing become a bailout for bad business decisions," said William Pletcher with Consumer Watchdog.

He adds refunds would not protect the policyholder.

"Refunds are not a substitute for legalities. They're not a permission slip to charge unlawful rates today to maybe correct them after," said Pletcher.

Understanding this would hurt homeowners, insurance experts say this was bound to happen given the state of the market.

"This could be $400 out of their pocket or $600, which is true, but it's better than not having a policy. This is math. This is not politics. This is not anything other than we need to be sure that the carriers have money to pay the claims," said insurance expert Karl Susman.
This hearing could last until Thursday. State Farm has witnesses ready to testify on its behalf and once again, the judge is only allowed to recommend a decision to the Insurance Commissioner.

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YouTube Video UExiOHFwN0VORVJITFJBYnZNb0JEcUlGUnF2NWlpLXdsRC43NDhFRTgwOTRERTU4Rjg3

California Department of Insurance, State Farm agree to a 17% rate increase proposal.

Insurance Hour April 10, 2025 3:48 am

CBS News Affiliate
Millions of State Farm Insurance customers in California will soon experience substantial rate hikes following an emergency increase approved by the state's Insurance Commissioner. The decision, which affects homeowners, renters and rental property owners, comes in response to State Farm's request for financial stabilization.

The approved increases include an average 17% rise for homeowners, 15% for renters and condo owners, and a dramatic 38% spike for rental property owners. These rate hikes are set to take effect on June 1, 2025.

"What this boils down to is, higher risk, higher exposure, means higher premiums," said Karl Susman, an independent insurance agency owner based in Los Angeles.

The rate increases vary based on location and risk factors. 

"You might see someone who is nowhere near the brush who has a home, their rate might go up 5%, but somebody who is closer to the hills or in an area that is very high-risk for wildfires might see it go up 25%," Susman explained.

State Farm's request for an emergency rate increase came in the wake of January wildfires in Los Angeles. The company initially sought a 22% increase for homeowners, but later revised to 17%.

An administrative law judge ruled in favor of State Farm's request, describing it as "a rescue mission to stabilize State Farm's financial condition while safeguarding policyholders." California's Insurance Commissioner subsequently backed this ruling.

In exchange for the interim approval, State Farm's parent company has agreed to provide a $400 million cash infusion to the insurance provider. Additionally, State Farm has committed not to drop existing customers through the end of 2025.

A full hearing is expected in October, where State Farm must justify the need for the rate increase. 

"If State Farm fails to demonstrate that need, then they had to agree that they will refund that money they've charged, that additional premium, plus interest to all of their affected policyholders," Susman said.

However, Consumer Watchdog, an organization challenging the rate increase, has criticized the Insurance Commissioner's decision. The group argues that "refunds will be too little, too late for homeowners who are already struggling to pay their home insurance premiums."

Customers will see the new rates take effect when their current policies are up for renewal.

Millions of State Farm Insurance customers in California will soon experience substantial rate hikes following an emergency increase approved by the state's Insurance Commissioner. The decision, which affects homeowners, renters and rental property owners, comes in response to State Farm's request for financial stabilization.

The approved increases include an average 17% rise for homeowners, 15% for renters and condo owners, and a dramatic 38% spike for rental property owners. These rate hikes are set to take effect on June 1, 2025.

"What this boils down to is, higher risk, higher exposure, means higher premiums," said Karl Susman, an independent insurance agency owner based in Los Angeles.

The rate increases vary based on location and risk factors.

"You might see someone who is nowhere near the brush who has a home, their rate might go up 5%, but somebody who is closer to the hills or in an area that is very high-risk for wildfires might see it go up 25%," Susman explained.

State Farm's request for an emergency rate increase came in the wake of January wildfires in Los Angeles. The company initially sought a 22% increase for homeowners, but later revised to 17%.

An administrative law judge ruled in favor of State Farm's request, describing it as "a rescue mission to stabilize State Farm's financial condition while safeguarding policyholders." California's Insurance Commissioner subsequently backed this ruling.

In exchange for the interim approval, State Farm's parent company has agreed to provide a $400 million cash infusion to the insurance provider. Additionally, State Farm has committed not to drop existing customers through the end of 2025.

A full hearing is expected in October, where State Farm must justify the need for the rate increase.

"If State Farm fails to demonstrate that need, then they had to agree that they will refund that money they've charged, that additional premium, plus interest to all of their affected policyholders," Susman said.

However, Consumer Watchdog, an organization challenging the rate increase, has criticized the Insurance Commissioner's decision. The group argues that "refunds will be too little, too late for homeowners who are already struggling to pay their home insurance premiums."

Customers will see the new rates take effect when their current policies are up for renewal.

4 2

YouTube Video UExiOHFwN0VORVJISVMzaHBxV0I0MV80V1QzdG54OXd4LS4zQzFBN0RGNzNFREFCMjBE

California's insurance commissioner approves significant rate hikes for State Farm

Insurance Hour May 16, 2025 1:07 am

Wildfires and insurance are two things homeowners worry about up here in California's fire country. For those in the Sierra Foothills who are covered by State Farm, the insurer's latest rate increase is something many people will have to budget for.

It's been nearly five years since the River Fire tore through parts of Colfax, burning land and homes. Lizz Porter's family home was one of them.

With help from California's FAIR Plan, her family was able to rebuild. But today, Porter is insured by State Farm, which is a rare provider in fire country.

"From a coverage standpoint, we have a lot more coverage with State Farm, a bit less than what we would be paying on the fair plan," Porter said.

Her premiums already went up last year, but now they're set to rise again.

This week, State Farm got state approval for an emergency rate hike after the company reported significant financial losses following the devastating wildfires in Los Angeles this January, which destroyed 16,000 buildings.

State Farm has been approved to raise rates across three policy types: homeowners insurance will go up an average of 17%, renters and condo insurance will rise by 15%, and landlord policies will increase by 38%. These numbers are averages, and the actual rate changes will vary depending on location. If you live in a city, your increases may be smaller. But for those living in high fire-risk zones, the jump could be much higher.

With peak fire season approaching, state officials fast-tracked the rate increase, which is unusual. Normally, rate hikes of this size go through a lengthy public hearing process before being approved. But in this case, regulators allowed it to move forward without that step, something insurance experts say has never happened before in California.

"That's really the balancing act the insurance commissioner had to go through," said insurance industry expert Karl Susman. "Is it better to approve a higher rate and ensure claims can be paid, or deny it and risk leaving policyholders with nothing when disaster strikes?"

As part of the agreement, the state insurance commissioner says State Farm will not drop additional customers all at once. Still, many homeowners in fire-prone areas are already struggling to get State Farm coverage at all. Most rely on California's FAIR Plan, the state's insurer of last resort. While it's often the only option available, it tends to be more expensive and provides less coverage..

"I think it's not sustainable," Porter said. "I think everything is getting more expensive. It's just not sustainable."

A formal hearing is expected as early as October to review whether the rate increase was justified. If a judge finds it wasn't, policyholders could receive refunds with interest.

Wildfires and insurance are two things homeowners worry about up here in California's fire country. For those in the Sierra Foothills who are covered by State Farm, the insurer's latest rate increase is something many people will have to budget for.

It's been nearly five years since the River Fire tore through parts of Colfax, burning land and homes. Lizz Porter's family home was one of them.

With help from California's FAIR Plan, her family was able to rebuild. But today, Porter is insured by State Farm, which is a rare provider in fire country.

"From a coverage standpoint, we have a lot more coverage with State Farm, a bit less than what we would be paying on the fair plan," Porter said.

Her premiums already went up last year, but now they're set to rise again.

This week, State Farm got state approval for an emergency rate hike after the company reported significant financial losses following the devastating wildfires in Los Angeles this January, which destroyed 16,000 buildings.

State Farm has been approved to raise rates across three policy types: homeowners insurance will go up an average of 17%, renters and condo insurance will rise by 15%, and landlord policies will increase by 38%. These numbers are averages, and the actual rate changes will vary depending on location. If you live in a city, your increases may be smaller. But for those living in high fire-risk zones, the jump could be much higher.

With peak fire season approaching, state officials fast-tracked the rate increase, which is unusual. Normally, rate hikes of this size go through a lengthy public hearing process before being approved. But in this case, regulators allowed it to move forward without that step, something insurance experts say has never happened before in California.

"That's really the balancing act the insurance commissioner had to go through," said insurance industry expert Karl Susman. "Is it better to approve a higher rate and ensure claims can be paid, or deny it and risk leaving policyholders with nothing when disaster strikes?"

As part of the agreement, the state insurance commissioner says State Farm will not drop additional customers all at once. Still, many homeowners in fire-prone areas are already struggling to get State Farm coverage at all. Most rely on California's FAIR Plan, the state's insurer of last resort. While it's often the only option available, it tends to be more expensive and provides less coverage..

"I think it's not sustainable," Porter said. "I think everything is getting more expensive. It's just not sustainable."

A formal hearing is expected as early as October to review whether the rate increase was justified. If a judge finds it wasn't, policyholders could receive refunds with interest.

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YouTube Video UExiOHFwN0VORVJISVMzaHBxV0I0MV80V1QzdG54OXd4LS4xOTEzQzhBQzU3MDNDNjcz

State Farm's rate increase fuels insurance worries in Northern California's fire country

Insurance Hour May 16, 2025 12:48 am

Fox News Affiliate

State Farm Requests ANOTHER Rate Increase

Insurance Hour March 15, 2025 12:39 am

A month ago, the Palisades Fire ripped through Heather Burnett's apartment, destroying everything from furniture to jewelry.

Burnett, moved from Lafayette to the Pacific Palisades just four months before the fire.

But the horrific flames miraculously spared one thing-- her Buddha statue. 

"I believe it's a miracle," Burnett said. "That's my faith."

 A glimmer of hope standing despite never-ending rubble. 

Her Buddha was shielded from the flames by a piece of drywall that fell over it, but somehow didn't crush it. And now it's wedged between the wall and the balcony, making it nearly impossible to recover. 

She hopes she'll be able to retrieve the Buddha, but because her apartment was red tagged she's not sure how.

"I'm hoping maybe there will be a way to get it," Burnett said.

Burnett, who is currently a nanny, has dedicated her life to working with kids for the last 25 years. 


The Evacuation:

The backstory:

The morning the fire broke out, she was in her apartment with the young boy she was looking after. 

"I woke up to the sirens," Burnett said. "They didn't stop, so after a few minutes I was like something is going on."

She looked outside and immediately evacuated. 

She grabbed her cat, Timmy, and the young boy and a few changes of clothes and her passport. 

She couldn't leave her cat and the boy in her car to go grab more belongings.

"My first priority was this child, he is in my care, I have to get him out," Burnett said. 

Like so many, she lost everything. 

Moving On

Dig deeper:

With or without the Buddha, Burnett is hoping to move on, but like many Americans, is underinsured. 

Her daughter, Alexanne Date, started a GoFundMe to help Burnett start over. 

But she felt guilty accepting help. 

"It didn't feel right because I'm so much luckier than so many other people," Burnett said. "I did it because, as almost everyone, I'm under insured."
Insurance Nightmare

She is dealing with an insurance nightmare.  

Her policy was written by Spinnaker Insurance, a company recommended by her apartment complex.

KTVU obtained a copy of her policy and had Karl Susman, an insurance expert, look over it. 

"At first glance it's not written the right way," Susman said. 

According to Susman, they left the liability limit down to the minimum when, for a dollar more a year, they could have covered her for up to $500,000. 

"You can tell this was not written by anyone who does this for a living," Susman said. 

Susman said renters' policies are significantly different from homeowners' policies and insurance companies can require people like Burnett to show proof of purchase for everything from electronics to a pair of socks.

"Unfortunately, this consumer [Burnett] is not going to get any protection from the department of insurance when it comes to itemization," Susman said. "That is based on homeowners insurance and that is a renter policy."

Burnett will likely have to itemize all of her belongings, unless Spinnaker Insurance decides to make an exception.

Something major insurance companies like State Farm have already done.

A month ago, the Palisades Fire ripped through Heather Burnett's apartment, destroying everything from furniture to jewelry.

Burnett, moved from Lafayette to the Pacific Palisades just four months before the fire.

But the horrific flames miraculously spared one thing-- her Buddha statue.

"I believe it's a miracle," Burnett said. "That's my faith."

A glimmer of hope standing despite never-ending rubble.

Her Buddha was shielded from the flames by a piece of drywall that fell over it, but somehow didn't crush it. And now it's wedged between the wall and the balcony, making it nearly impossible to recover.

She hopes she'll be able to retrieve the Buddha, but because her apartment was red tagged she's not sure how.

"I'm hoping maybe there will be a way to get it," Burnett said.

Burnett, who is currently a nanny, has dedicated her life to working with kids for the last 25 years.


The Evacuation:

The backstory:

The morning the fire broke out, she was in her apartment with the young boy she was looking after.

"I woke up to the sirens," Burnett said. "They didn't stop, so after a few minutes I was like something is going on."

She looked outside and immediately evacuated.

She grabbed her cat, Timmy, and the young boy and a few changes of clothes and her passport.

She couldn't leave her cat and the boy in her car to go grab more belongings.

"My first priority was this child, he is in my care, I have to get him out," Burnett said.

Like so many, she lost everything.

Moving On

Dig deeper:

With or without the Buddha, Burnett is hoping to move on, but like many Americans, is underinsured.

Her daughter, Alexanne Date, started a GoFundMe to help Burnett start over.

But she felt guilty accepting help.

"It didn't feel right because I'm so much luckier than so many other people," Burnett said. "I did it because, as almost everyone, I'm under insured."
Insurance Nightmare

She is dealing with an insurance nightmare.

Her policy was written by Spinnaker Insurance, a company recommended by her apartment complex.

KTVU obtained a copy of her policy and had Karl Susman, an insurance expert, look over it.

"At first glance it's not written the right way," Susman said.

According to Susman, they left the liability limit down to the minimum when, for a dollar more a year, they could have covered her for up to $500,000.

"You can tell this was not written by anyone who does this for a living," Susman said.

Susman said renters' policies are significantly different from homeowners' policies and insurance companies can require people like Burnett to show proof of purchase for everything from electronics to a pair of socks.

"Unfortunately, this consumer [Burnett] is not going to get any protection from the department of insurance when it comes to itemization," Susman said. "That is based on homeowners insurance and that is a renter policy."

Burnett will likely have to itemize all of her belongings, unless Spinnaker Insurance decides to make an exception.

Something major insurance companies like State Farm have already done.

4 1

YouTube Video UExiOHFwN0VORVJIS1RNOUYwVTFLXzdwQWw4XzExZ1dSTC43NDhFRTgwOTRERTU4Rjg3

California woman loses everything in Palisades Fire, except Buddha statue

Insurance Hour February 9, 2025 9:13 pm

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