California insurance regulators have “provisionally approved” State Farm’s request for a massive rate hike for homeowners following the devasting Los Angeles wildfires.
On Friday, Insurance Commissioner Ricardo Lara announced he will allow The state’s largest insurer also won approval to increase premiums by 15% for renters and condo owners and 33% for rental owners.
State Farm to raise homeowners’ rates by an average of 22%.REALTED: Why were these Bay Area communities left off map of fire-risk areas where insurers must expand coverage?However, Lara said the “emergency interim” rate hikes can only go through if the company can provide data to justify the increases in a public hearing scheduled for April 8.
The insurer’s California-only subsidiary, State Farm General, says the hikes are necessary to pay out future claims after it expects to cover $7.6 billion in estimated losses from the devastating Los Angeles wildfires. The company said it can cover the staggering damage in Southern California but must raise rates to shore up its shaky financial health.
