State Farm pays out over $2.5 billion for CA wildfire claims

State Farm has provided another update regarding the California wildfire claims and as of March 28, the insurer received more than 12,300 total claims and paid over $2.5 billion to customers.

State Farm’s most recent estimate of direct losses from the fires stands at approximately $7.6 billion, taking into account both reported and not reported claims.

State Farm Mutual Automobile Insurance Company serves as the primary reinsurer for State Farm General and will assume the majority of losses related to the fires.

Last week, California Insurance Commissioner Ricardo Lara announced that the California FAIR Plan Association has agreed to more than double its existing commercial coverage limits to $20 million for businesses unable to find coverage in the normal insurance marketplace. The agreement will increase the combined coverage limits for the FAIR Plan, under its Division I Commercial Property Program, from $8.4 million to $20 million per location and, under its Division II Businessowners Program, from $7.2 million to $20 million per location.

“This targeted FAIR Plan expansion helps meet the urgent needs of homeowners associations, affordable housing developers, farmers, builders, and business owners who are being priced out or left without coverage altogether. It is a short-term solution with long-term benefits—providing necessary insurance access while we continue implementing comprehensive reforms to restore a competitive and reliable market in California.” – Commissioner Lara.