California homeowners are facing a 22% increase in insurance premiums if State Farm, the state’s largest single insurer with roughly 1 million home insurance policies in California, can “justify it with data in a public hearing" next month, California’s top insurance regulator said Friday, reports the Los Angeles Times.
“State Farm claims it is committed to its California customers and aims to restore financial stability. I expect both State Farm and its parent company to meet their responsibilities and not shift the burden entirely onto their customers,” California Insurance Commissioner Ricardo Lara said in a statement.
“The facts will be revealed in an open, transparent hearing.”
Lara added that should State Farms' withdraw from the state "it is evident that other California insurers are unable to absorb State Farm's existing customers."
If that happens, current customers could be forced onto the California FAIR Plan, a last-resort insurance program the state is trying to move people away from.
State Farm said the emergency rate would help the company rebuild its capital following the Los Angeles wildfires that destroyed more than 16,000 buildings, mostly homes. The company is trying to prevent a “dire” financial situation that executives say could force them to drop more California policies.
A report released in late February estimated that the January wildfires in Los Angeles County caused up to $53.8 billion in property damage.
At least 29 people died, and thousands lost their homes.
Solange Reyner ✉
Solange Reyner is a writer and editor for Newsmax. She has more than 15 years in the journalism industry reporting and covering news, sports and politics.
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