What you need to know: Governor Newsom urged insurance companies to quickly and fairly process pending claims for LA recovery survivors after the state announced the largest insurance enforcement action in a century against State Farm.
SACRAMENTO – Governor Gavin Newsom today warned insurance companies that they may be subject to state enforcement if they unlawfully delay or deny claims for LA fire survivors. The warning comes as the State Insurance Commissioner today announced an enforcement action against State Farm General Insurance Company after an expedited investigation uncovered significant mishandling of insurance claims filed by survivors. That action seeks the largest penalties following a disaster this century.
“Survivors’ ability to access their insurance coverage is foundational to LA recovery. People need accelerated relief, and we’re not going to sit by while companies slow-walk claims and make it harder for families to rebuild. We’re standing up for survivors by holding insurance companies accountable — especially when they delay or deny what people are owed.”Governor Gavin Newsom
Governor Newsom has been a staunch advocate for survivors and their ability to access coverage. Last year, Governor Newsom sent a letter to the FAIR plan warning that their handling of survivors’ smoke damage claims was unscrupulous and unfair, and ultimately may be illegal — urging them to resolve fire survivors’ claims with the speed and fairness FAIR Plan customers deserve.
Governor Newsom has been squarely focused on stabilizing and modernizing California’s home insurance market, especially as climate change drives more severe wildfire risk. Since 2019, Governor Newsom has:
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Strengthened California’s FAIR Plan: Expanded capacity and authorities of the FAIR Plan as the insurer of last resort.
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Advanced insurance market reforms: Issued an executive order in 2023 urging the California Department of Insurance to modernize rate-setting rules, incorporate climate risk, and ensure insurers write more policies, leading to reforms like using forward-looking catastrophe models and improving the FAIR Plan, all under the “Sustainable Insurance Strategy” to stabilize the market and expand coverage. As a result, nine homeowners insurers (Farmers, Mercury, CSAA, USAA, Horace Mann, Pacific Specialty, California Casualty, Travelers, AAA SoCal), including six of the top 10 insurer groups, committed to stay and grow in California.
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Invested in wildfire risk reduction: Committed billions of dollars to forest management, prescribed burns, and vegetation treatment, and expanded home hardening and community wildfire mitigation programs.
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Maintained strong consumer protections: Preserved public review and justification requirements for rate increases and ensured continued oversight by one of the nation’s strongest insurance regulatory frameworks as we shift from crisis response to long-term market stability.
California home insurance rates remain below the national average and far below what homeowners are paying in other states. For a standard policy with $300,000 in dwelling coverage, Florida is now the most expensive state in the country at $7,136 — 181% above the national average and 4.4 times California’s rate — after regulator-approved Florida home insurance rates rose 49.5% from 2020 through 2025. Louisiana ranks second at $5,986 after a 58% increase from 2023 to 2025, while Texas averages $4,085 and the median Texas homeowner paid 60% more in 2024 than in 2019.
California – $1,616 | National – $2,543 | Texas – $4,085 | Florida – $7,136
