California lawmakers are demanding explanations from major insurance companies about requirements that have blocked wildfire victims from receiving payouts since devastating fires swept through Los Angeles County in January 2025.
Senator Adam Schiff and 15 Democratic congressional allies sent a letter Tuesday to nine insurers, including State Farm General and the California FAIR Plan, questioning their practices of requiring itemized receipts for personal property losses—even when victims’ records were destroyed in the fires.
“We have received outreach from constituents who shared that they have been required to itemize their material losses and provide receipts corresponding to every item, which can also include requirements of photographic evidence of prior ownership—an impossible task even for those who have not lost everything,” the lawmakers stated in their letter.
The inquiry comes as 70% of fire victims remain displaced more than a year after the blazes that killed at least 31 people and destroyed over 16,000 structures in Pacific Palisades, Altadena and other areas.
In October 2025, Governor Gavin Newsom signed legislation raising advance payments to 60% of personal property coverage (up to $350,000) without requiring itemized receipts when a disaster is declared. However, this law wasn’t retroactive, leaving January 2025 fire victims struggling with stricter requirements.
New legislation introduced by state Senator Steve Padilla would allow total-loss victims to receive 100% of their personal property coverage without itemization. His Senate Bill 876 also seeks to double penalties for fair claims practice violations during emergencies and require insurers to notify policyholders within five days when they’re assigned a new adjuster.
The FAIR Plan, California’s insurer of last resort, has faced particular scrutiny. Assemblymember Lisa Calderon introduced legislation Monday requiring the FAIR Plan to offer more comprehensive policies, hire additional staff, and address complaints faster.
“I’ve kind of reached a point where I prefer to call the FAIR Plan ‘the California safety net’ than the ‘insurer of last resort,'” Calderon said during an Assembly Insurance Committee meeting. “When the voluntary insurance market abandons our constituents, the FAIR Plan is there to pick up those policies.”
State Farm spokesperson Bob Devereux defended the company’s practices, stating they understand “in a total loss, receipts and records are likely destroyed” and that their “goal is to help customers move forward as quickly and fairly as possible.”
The company reports paying out more than $5 billion to 13,500 customers affected by the wildfires, though many victims tell different stories.
Jen Egan, whose 83-year-old father’s home was damaged in the Palisades Fire, described ongoing frustrations with State Farm, which has assigned three different claims adjusters to their case. This week, they received an estimate tens of thousands of dollars short of what they’ve already paid out of pocket.
“No one’s asking for a new jacuzzi,” Egan told CalMatters. “We want my father to be able to return to a safe and habitable home.”
The insurance industry has pushed back against proposed reforms. The American Property Casualty Insurance Association criticized Calderon’s FAIR Plan legislation, stating: “This legislation is a lose-lose for Californians. Mandates like these are the root cause of California’s insurance crisis.”
Meanwhile, the FAIR Plan’s exposure has increased 4% to $724 billion between September and December 2025—a 230% increase since December 2022—as more homeowners are forced to rely on the state’s insurer of last resort.
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