California insurance regulators are questioning State Farm's request for significant rate increases for homeowners, renters, and rental properties following the recent Los Angeles wildfires. The insurer seeks a 22% homeowner rate hike, citing financial losses exceeding $1 billion. Insurance Commissioner Ricardo Lara emphasized State Farm must demonstrate a compelling need for these increases, as past rate hikes have already occurred. Although immediate approval was denied, future consideration remains possible. The company has paused new policies and ceased coverage for many homeowners, leading to further inquiries into its financial stability and support from its parent company.
State Farm has not met its burden to show why emergency rate hikes are needed now after California wildfires, despite claiming it is necessary to cover claims.
Insurance Commissioner Ricardo Lara has not approved State Farm's request for immediate rate hikes but states that there will be a meeting to discuss specifics.
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