Los Angeles County filed the case in Los Angeles County Superior Court after a county investigation, naming Illinois-based State Farm General Insurance Co. and State Farm Mutual Automobile Insurance Co. The complaint contends the insurer withheld funds from policyholders in ways that breached contract obligations. County officials said the company did not cooperate with the November-launched probe, declined to provide documents requested via subpoena, and signaled it was not interested in addressing concerns raised on behalf of wildfire victims. Supervisor Lindsey Horvath, who represents the western portion of Los Angeles County that includes the Palisades Fire area, said, "We tried this the nice way." "State Farm must live up to its commitment to be a 'good neighbor' and do right by its customers who have lost so much."
The complaint highlights the Eaton and Palisades fires, saying they left 31 people dead, leveled more than 16,000 structures, and led to roughly $40 billion in insured losses. It further asserts that, by the end of 2025, State Farm Mutual reported $170 billion in net assets - up $24.8 billion from the year before. The filing also notes that, in the aftermath of the fire, regulators approved State Farm General for California's first emergency rate hike on homeowners' insurance, averaging 17%.
The insurer rejected the accusations. "State Farm General strongly disagrees with Los Angeles County's characterization of our wildfire claims response," spokesperson Bob Devereux said in an email Monday. "We will review the lawsuit and respond through the appropriate legal process. Wildfire survivors deserve support, clear answers, and a fair claims process." Devereux said the company has disbursed more than $6.2 billion in claim payments since the fires, including $1 billion tied to smoke-related damage, and that about 78% of claims have been closed. In California, State Farm maintains over 2.8 million policies for homes and businesses and, with 13,700 fire-related claims processed, had the state's largest affected customer base last year.
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The suit does not detail the dollar amount sought for compensation, restitution, and penalties. "It's going to be a lot of money," said Scott Kuhn, assistant county counsel. Any outcome that affects claim payouts, processing practices, or regulatory actions could influence California-focused insurers and broader exposure to the catastrophe insurance market.
