Insurance giant State Farm canceled hundreds of homeowners' policies last summer in the Pacific Palisades neighborhood of Los Angeles, where an estimated 1,000 structures have been destroyed by a Santa Ana-wind-fueled wildfire, reports Newsweek.
The decision by State Farm, one of the biggest insurers in California, was justified by the company as an attempt to avoid "financial failure."
The Palisades fire is the most destructive in L.A. history and has sent residents fleeing from burning homes.
AccuWeather estimates $52 billion to $57 billion in preliminary damage and economic loss has occurred from the raging Los Angeles area wildfires.
State Farm last March announced it would not renew approximately 30,000 homeowner policies across the state based largely on the risk of wildfires and fires after earthquakes, reports the San Francisco Chronicle.
The move prompted many homeowners to sign up for the California FAIR Plan for fire coverage, a state-created, privately run insurer of last resort which covers, at its most basic, damage from fire, lightning, internal explosions, and smoke.
The cost: several thousand dollars a year annually.
"We recognize that the insurance market in California is challenging and securing property insurance has become more difficult. We are doing everything we can to support our customers during this time," a State Farm spokesperson told the Chronicle at the time.
State Farm in a press release Wednesday said it was "here to help California customers impacted by wildfires.
"Our number one priority is the safety of our customers, agents and employees impacted by the fires and assisting our customers in the midst of this tragedy. We are here for our customers to help begin the process of recovery."
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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