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California Insurance Commissioner Ricardo Lara said Saturday that regulators may launch a formal investigation into the company’s practices after prosecutors were declared at a community meeting about how state farm generals are handling the claims of the Los Angeles wildfire.
Lara commented during a Zoom session attended by 200 survivors of the Palisade and Eton Fire. He complained that the claims were delayed in handling, difficult to get tested for toxic substances, and that he was revising damaged homes and replacing destroyed homes.
“It’s not off the table,” Lara said. Lara mentioned the authority to conduct what the company responds to fires, known as the “market behavior” test. “We’re not necessarily against it.”
The department has previously conducted such investigations following other major fires.
The state farm said on Sunday that it will have the largest claims force in the industry and “focusing on customers and helping to recover from the biggest fire event the state has ever experienced.”
“We will work actively with each of our customers to resolve their claims by understanding the facts of the loss and identifying damages and applicable compensation,” the statement said.
The company said it had received more than 12,600 bills as of May 5th and paid more than $3.4 billion to its customers.
Separately, Tony Signalail, deputy committee member for consumer services and market action, told fire victims that the department sent California’s Fair Plan ASSN. Last week, a letter seeking information on how last resort insurance companies are handling allegations of smoke damage.
The Fair Plan was sued last month by both fire zone policyholders who allegedly refused to properly investigate and pay smoke damage as required by state law. Also named defendants are state farms and other California licensed home insurance companies that plan.
As California’s biggest home insurance company awaits decision on demanding emergency rate increases in response to losses from the Jan. 7 fire, the threat of conducting market behavior testing on state farm generals’ claims processing practices.
The company originally filed for a 22% interest rate hike in its homeowner’s policy, but it reduced it to 17% during a previous hearing last month by an administrative law judge.
The judge is expected to make a recommendation to Lala as soon as possible this week. You can also send it back for reconsideration.
Joy Chen, whose Altadena’s home has been damaged by Soot and Ash, asks Lara to postpone giving some rate hike until he “completely” investigates the complaint.
“We’ll submit them to you,” said Chen, leader of the Eton Fire Survivor Network.
Lara said she could not link the investigation to a complaint to consider a rate hike, but she said this was “a separate judicial process currently underway.” However, he asked the fire survivors to file all the complaints with the department.
“What I’m trying to do is collect all the data I receive and send it to our law enforcement team because I really want to see… I want to see all of the allegations spoken today,” he said.
Chen, who said her home was effectively improved by insurance company USAA, later told The Times:
Last week, the Los Angeles County Department of Public Health announced that it had discovered high levels of lead and other toxic metals in homes destroyed by wildfires with overhead soil shattered by the U.S. Army Corps of Engineers, particularly in the Altadena area, where old homes are located.
Regarding the fair plan, Cignarale said the department’s letter to the insurance company asked “for very specific information about the very measures being taken to resolve these smoke claims.”
Lara told fire victims she issued a bulletin to state insurance companies in March, stating she hopes they will “have a full investigation and pay for their legitimate smoke claims.” He said fire victims should file their complaints with the state if that was not happening.
He also said the department is planning to convene health experts to develop state standards for repairing smoke damage. “Without the standards set, the insurance company will do anything to get you back to your home as quickly as possible,” he said.
“We have paid thousands of claims for losses resulting from the recent LA Fire disaster, including losses including daily smoke damage,” said Hillary McLean.
She said in her assessment of claims that the plan relies on “recent case law, guidance from the California Department of Insurance, and our insurance contract form.” She added a payment for the industrial hygienist’s plan to be tested “to assess whether the smoke caused property-covered damage if necessary.”
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