Senators Call for Probe Into California Insurance Department's Handling of Wildfire Claims

Lawmakers seek investigation into complaints from Los Angeles fire victims struggling to collect payouts from State Farm

Published on Feb. 20, 2026

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Two California state senators have requested an investigation into the state's insurance department over its handling of complaints filed by Los Angeles wildfire victims who are struggling to collect payouts from their insurer, State Farm. The calls for the inquiry follow a Los Angeles Times report that revealed a range of complaints from more than a dozen fire victims over the department's response, as well as allegations that a state compliance officer who cited State Farm for violations was punished with a pay cut after a State Farm executive complained.

Why it matters

The proposed investigation would be a rare critical examination of the California insurance department and how it has responded to consumer complaints against insurers accused of denying and delaying wildfire claims. The inquiry could shed light on the department's practices and its oversight of insurance companies during major disaster events.

The details

Sens. Ben Allen (D-Pacific Palisades) and Sasha Renée Pérez (D-Alhambra) have verbally requested the investigation on the Senate floor. The request is now before the Senate Insurance Committee Chairperson Steve Padilla (D-San Diego), who could call for an informational hearing or a more formal Senate investigation with subpoena power. Pérez also questioned the status of a separate market conduct investigation launched in June into State Farm's claims practices. Consumer advocates have welcomed the proposed inquiry, saying it could help enforce California's strong consumer protection laws.

  • The January 2025 wildfires ravaged the Pacific Palisades and Altadena areas, killing 31 and destroying more than 16,000 structures.
  • In April 2026, California Insurance Commissioner Ricardo Lara first broached the possibility of a market conduct investigation into State Farm's claims practices.
  • The market conduct investigation into State Farm was announced in June 2026, at the request of Pérez and other lawmakers.
  • In November 2026, Los Angeles County opened its own investigation into State Farm's claims handling.
  • In June 2026, Lara approved a 17% emergency hike on homeowner premiums for State Farm, with a settlement expected on a full 30% increase by the end of the month.

The players

Ben Allen

A Democratic state senator representing the Pacific Palisades area, one of the fire zones affected by the January 2025 wildfires.

Sasha Renée Pérez

A Democratic state senator representing Alhambra, another area affected by the January 2025 wildfires.

Steve Padilla

The Democratic chairperson of the California Senate Insurance Committee, with a track record of consumer protection issues.

Ricardo Lara

The California Insurance Commissioner who first broached the possibility of a market conduct investigation into State Farm's claims practices and approved rate hikes for the company.

Coleen Vandepas

A 32-year veteran state compliance officer who was disciplined for criticizing State Farm's handling of wildfire claims.

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What they’re saying

“These are pretty shocking allegations. We think we need to do something with this information. What form exactly it will take has yet to be determined.”

— Ben Allen, State Senator (Los Angeles Times)

“I need to have confidence that they are taking investigations into delayed and denied claims seriously.”

— Sasha Renée Pérez, State Senator (Los Angeles Times)

“California has the best consumer protection laws in the nation ... all we need now is to get them enforced.”

— Joy Chen, Director, Eaton Fire Survivors Network (Los Angeles Times)

“We want to see a responsive department. We want to see a department that is advocating for consumers.”

— Ben Allen, State Senator (Los Angeles Times)

“State Farm used the L.A. fires and the threat of future fires to press the urgency of a $1.3-billion rate hike.”

— Carmen Balber, Executive Director, Consumer Watchdog (Los Angeles Times)

What’s next

The Senate Insurance Committee Chairperson Steve Padilla will determine the next steps, which could include calling for an informational hearing or launching a more formal Senate investigation with subpoena power.

The takeaway

This investigation could shed light on how the California insurance department handles consumer complaints against insurers during major disaster events, and whether it is effectively enforcing the state's strong consumer protection laws. The outcome could have significant implications for how insurance companies respond to future wildfires and other natural disasters in the state.