Insurance Commissioner Ricardo Lara has rejected State Farm General's request for an average 22 percent home insurance rate hike triggered by recent Los Angeles wildfires. The company had argued the increase was essential to recuperate over $1 billion paid out in claims following extensive property damage. However, Commissioner Lara found the request unsupported and expressed concern over State Farm's previous decision not to write new home policies in California. He emphasized the importance of protecting policyholders from unnecessary cost increases.
Lara noted that State Farm did not sufficiently justify the need for a rate increase, raising concerns about its financial stability and policyholder impacts.
State Farm's position indicated they needed increased rates to recuperate losses from wildfires while simultaneously ceasing new home policies, raising questions about sustainability.
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