County Action Follows Mounting Complaints from Fire Survivors
Los Angeles, CA — Consumer Watchdog today commended the Los Angeles County Board of Supervisors and the Los Angeles County Office of County Counsel for opening a civil investigation into State Farm’s handling of wildfire claims related to the 2025 LA Wildfires, calling the County’s step “a vital step to protect wildfire victims.” The County’s announcement, issued by the Board of Supervisors and County Counsel Dawyn R. Harrison, outlines a formal Unfair Competition Law (Bus. & Prof. Code § 17200 et seq.) inquiry into widespread complaints of delays, underpayments, and denials of legitimate claims.
“Many wildfire survivors have been waiting for nearly a year for help that hasn’t come,” said Carmen Balber, Executive Director at Consumer Watchdog. “We’ve received voluminous complaints from consumers that their insurers—including State Farm—have delayed, tried to underpay, or outright denied their claims. The County’s investigation finally gives fire victims a chance at real accountability and relief.”
As detailed in their letter, County Counsel’s Affirmative Litigation and Consumer Protection Division has launched a formal investigation under the Unfair Competition Law into State Farm’s practices following the January 2025 Eaton and Palisades wildfires. The investigation letter seeks information on delays and denials of wildfire claims; rotating adjuster tactics that confuse policyholders and complicate claims handling; misrepresentations of coverage; payments for smoke damage and additional living expenses; refusal to disclose estimates and inspection results upon request; and the use of AI tools in review of claims.
Consumer Watchdog’s prior investigations have broadly documented similar insurer issues now under review by the County, including Up in Smoke: How Insurance Companies and the Insurance Commissioner Burn Wildfire Victims and Lowballed: What Fire Survivors Want You to Know About Insurance Claims. Those reports identified recurring patterns of underpayment for smoke and ash damage, frequent rotation of adjusters that complicated claim resolution, and increasing reliance on estimating software and artificial-intelligence tools that tended to minimize payouts. The County’s new inquiry appears to cover many of the same concerns, underscoring the importance of independent oversight and enforcement. Consumer Watchdog has also explored these issues through its Smoke and Mirrors podcast series, which documents the human impact of insurance-claim practices on wildfire survivors and the systemic failures that have allowed them to persist.
Consumer Watchdog emphasized that under California law, state and county prosecutors — including County Counsel and District Attorney, and City Attorneys — may bring public law enforcement actions under the Unfair Competition Law (Bus. & Prof. Code § 17200 et seq.) to stop and remedy unlawful business practices and unfair competition. Such actions can lead to significant civil penalties, restitution of money obtained through unlawful conduct, and permanent injunctions to prohibit future misconduct.
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