California reconsidering State Farm insurance rate hikes for homeowners after LA wildfires
State Farm asks California to raise homeowner insurance rates by 22%
State Farm wants to raise its rates by about 22% for California homeowners, which would affect about one million people.
State Farm is asking the state of California if it can temporarily raise its homeowner insurance rates because the company says that paying out claims for the Los Angeles wildfires is hurting its finances.
A closed-door conversation between state insurance officials, including California Insurance Commissioner Richard Lara and State Farm occurred in Oakland on Wednesday afternoon.
What we know:
Commissioner Lara said the public will know in two weeks whether such a temporary hike will take effect.
After turning down the idea earlier this year, Lara said he is now considering the hike.
He's hoping State Farm may consider committing to expanding its coverage in the state if granted the rate hike.
In the last two years, State Farm opted to stop renewing and writing new policies for California homeowners.
If the rates do go up, the hike will take effect in May.
By the numbers:
State Farm wants to raise its rate by about 22% for California homeowners, which would affect about one million people.
In a letter to the state agency, State Farm said it has already paid out more than $1 billion for just a few thousand claims after the destructive LA wildfires.
State Farm said it will eventually pay out $7.6 billion.