State Farm Seeks Rate Hikes In California To Offset Wildfire Payouts

California's largest private insurer, State Farm, has urged the state's insurance regulator to approve an emergency rate hike to help offset the substantial payouts the company is making following last month’s devastating wildfires in Los Angeles, Kanjyik Ghosh, Bipasha Dey, and Rishabh Jaiswal reported for Reuters.

State Farm insures 250,000 homes and 880,000 automobiles in Los Angeles County. I Photo: *Hajee Flickr

The company is seeking rate increases of up to 22% for non-tenant homeowners, 15% for renters and condominium owners, and up to 38% for rental dwellings.

Non-tenant homeowners are investors who do not live in the properties they own. The insurance regulator will review these rate-increase applications, a spokesperson told Reuters in an email.

State Farm insures 250,000 homes and 880,000 automobiles in Los Angeles County, according to its website.

Statewide, it insures more than a million homes and over four million automobiles, with billions of dollars in risk exposure. The high risk of frequent wildfires in parts of California has driven insurers out of the state in recent years, forcing homeowners to turn to a much costlier state-run insurance program.

The Los Angeles fires last month killed 28 people and damaged or destroyed more than 16,000 structures.