State Farm, in an update about its claims response to customers impacted by the wildfires in California, indicated that some policyholders slated for nonrenewals will get a reprieve from the giant insurer.

A media statement on the firm’s website provided information about how to file claims, and also reported that as of Wednesday morning (1/15/2025), customer contact stood at 90 percent, with the insurer having received more than 7,400 home and auto claims.

In a sidebar note next to the claims announcement, State Farm addressed the “issue of nonrenewals” stating, “We have paused the notification process on homeowner nonrenewals in the areas affected by the fires. Homeowner policies impacted by the fires that were on the books on Jan. 7, will have an option to renew with State Farm for another policy term.”

The sidebar continued: “The California market is complex, we remain engaged with state officials to improve the long-term sustainability of insurance for residents. We’re here to ensure that there’s a sustainable market in California, so we can continue to serve California as we have for almost 100 years.” It then refers readers to some information that has existed on the website since last year, offering facts about State Farm’s participation in the California market and attempting to debunk commonly reported myths (that it is exiting California, declining to insurer homes in wildfire-prone areas and putting profits ahead of customers, among others).

In May 2023, State Farm announced that State Farm General Insurance Company, the group’s provider of homeowners insurance in California, would cease accepting new applications including all personal lines property and casualty insurance in California. Then, in March 2024, State Farm announced that State Farm General would also nonrenew approximately 30,000 homeowners, rental dwelling and other property insurance policies (residential community association and business owners) beginning July 3.

Ricardo Lara, the California Insurance Commissioner, drew attention to State Farm’s action to pause the nonrenewals for policyholders impacted by the recent fires in a LinkedIn post last night.

“I applaud State Farm for ANSWERING MY CALL and setting a positive example for all insurance companies to follow,” he wrote.

“All eyes are on insurance companies right now, including mine. I’ve urged State Farm and all insurers to honor the policies they nonrenewed in the areas I’ve protected through my moratorium powers, as communicated in my notice last week,” he wrote.

On Jan. 9, the commissioner announced an order putting a mandatory one-year moratorium on insurance nonrenewals and cancellations. The order shields those within the perimeters or adjoining ZIP Codes of the Palisades and Eaton fires regardless of whether they suffered a loss.

In conjunction with the order, Commissioner Lara also issued a Notice calling on all admitted and nonadmitted insurers writing residential property insurance in California to stop any pending nonrenewals or cancellations for properties located near wildfires in order to help policyholders that were not already protected by the mandatory moratorium.

“This includes nonrenewals issued up to 90 days prior to January 7, but taking effect after the start of the wildfires. This pause on nonrenewing and cancelling policies would last six months as impacted communities begin the recovery process,” Lara said in the Jan. 9 media statement.

“Insurers need to do the right thing and stand by their customers,” Lara said in the LinkedIn post. “We will continue working to ensure that everyone’s claims are paid fairly, quickly, and completely. As we gather more data, I will expand moratoriums to the fullest extent of the law. Ultimately, our goal is to ensure that consumers receive the help they need.”

State Farm’s latest announcement also includes information safety recommendations, a checklist of what’s next” for customers with significantly damaged properties that need to file claims, and reveals that State Farm is making a $2 million commitment to support relief efforts, with funds going to the American Red Cross, Feeding America, Los Angeles Fire Department Foundation and Hollywood Food Coalition.

(Editor’s Note: Several media outlets, including the Wall Street Journal and Ad Age, reported last night that State Farm has decided not to move forward with previously planned advertising in conjunction with this year’s Super Bowl. Carrier Management had not confirmed this at press time.)

Images: State Farm Media