Part 176: The Eaton Fire Fallout - Market Conduct Examinations and Community Rebuilding

[ellisonz]

By Zachary Ellison, Independent Journalist

The announcement left the spokesperson for State Farm Insurance questioning whether there would be “a fair review” of the payouts made by one of California’s most powerful insurers in the wake of the devastating wildfires that struck on January 7, 2025. The Eaton Fire wasn’t the first fire to start that day, with the Palisades Fire preceding it, striking with devastating furor. Yet the organization and advocacy of a determined group of Altadenans may have succeeded in applying enough pressure to force the hand of California Insurance Commissioner Ricardo Lara to launch a market conduct examination into its handling of claims from wildfire victims.

Less than inspiring numbers suggested an underpayment in progress, with journalist Laurence Darmiento of the Los Angeles Times noting that the insurer had paid out $3.96 billion on an estimated cost of $7.6 billion, with “reinsurance payments” reducing the firm’s overall loss to only $612 million. Business is good if you’re selling a necessary product in a market that, by almost everyone’s agreement, is under duress. Charged with ensuring the availability of insurance, Lara has been increasingly under criticism over his cozy industry relationships and fundraising to save a political career increasingly looking to be approaching a certain end.

Link: https://zacharyellison.substack.com/p/part-176-the-eaton-fire-fallout-market