State Farm has not been a good neighbor for California fire victims
State Farm is facing criticism and legal action for its handling of insurance claims following the Eaton and Palisades Fires in California. Despite record profits, the company made lowball settlement offers, repeatedly changed adjusters, and required extensive documentation from victims who had lost everything. California's Insurance Commissioner has recommended suspending State Farm's license and imposing fines after finding the company abused its customers.
- ▪State Farm is under investigation for failing to adequately compensate victims of the Eaton and Palisades Fires in California.
- ▪The company made lowball offers, rotated adjusters frequently, and required detailed itemized lists of lost possessions before paying claims.
- ▪State Senator Ben Allen passed SB 495 requiring insurers to pay at least 60% of personal property losses upfront, later increased to 65% under federal pressure.
- ▪The Trump administration, through EPA Administrator Lee Zeldin, intervened to hold insurance companies accountable for their claims practices.
- ▪Outgoing California Insurance Commissioner Ricardo Lara recommended a one-year license suspension and fines for State Farm after concluding it abused policyholders.
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Opinion State Farm has not been a good neighbor for California fire victims By CA Post Editorial Board Published May 5, 2026, 12:06 a.m. ET State Farm has not been a good neighbor. The insurance giant is in hot water with the Trump administration, and now the State of California, for its poor performance in compensating victims of the Eaton and Palisades Fires. Residents paid their premiums dutifully for years. But when disaster struck, they were on their own. State Farm notoriously dropped thousands of households from their policies, forcing them onto the California FAIR plan (which some took to calling the “un-FAIR plan”). 3 State Farm has not been a good neighbor.
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