California: Governor Newsom warns insurance companies after major state enforcement against State Farm
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May 4, 2026

Governor Newsom warns insurance companies after major state enforcement against State Farm

What you need to know: Governor Newsom urged insurance companies to quickly and fairly process pending claims for LA recovery survivors after the state announced the largest insurance enforcement action in a century against State Farm.

SACRAMENTO – Governor Gavin Newsom today warned insurance companies that they may be subject to state enforcement if they unlawfully delay or deny claims for LA fire survivors. The warning comes as the State Insurance Commissioner today announced an enforcement action against State Farm General Insurance Company after an expedited investigation uncovered significant mishandling of insurance claims filed by survivors. That action seeks the largest penalties following a disaster this century.

Survivors' ability to access their insurance coverage is foundational to LA recovery. People need accelerated relief, and we're not going to sit by while companies slow-walk claims and make it harder for families to rebuild. We're standing up for survivors by holding insurance companies accountable — especially when they delay or deny what people are owed.

Governor Gavin Newsom

Governor Newsom has been a staunch advocate for survivors and their ability to access coverage. Last year, Governor Newsom sent a letter to the FAIR plan warning that their handling of survivors' smoke damage claims was unscrupulous and unfair, and ultimately may be illegal — urging them to resolve fire survivors' claims with the speed and fairness FAIR Plan customers deserve.

Governor Newsom has been squarely focused on stabilizing and modernizing California's home insurance market, especially as climate change drives more severe wildfire risk. Since 2019, Governor Newsom has:
  • Strengthened California's FAIR Plan: Expanded capacity and authorities of the FAIR Plan as the insurer of last resort.
  • Advanced insurance market reforms: Issued an executive order in 2023 urging the California Department of Insurance to modernize rate-setting rules, incorporate climate risk, and ensure insurers write more policies, leading to reforms like using forward-looking catastrophe models and improving the FAIR Plan, all under the "Sustainable Insurance Strategy" to stabilize the market and expand coverage. As a result, nine homeowners insurers (Farmers, Mercury, CSAA, USAA, Horace Mann, Pacific Specialty, California Casualty, Travelers, AAA SoCal), including six of the top 10 insurer groups, committed to stay and grow in California.
  • Invested in wildfire risk reduction: Committed billions of dollars to forest management, prescribed burns, and vegetation treatment, and expanded home hardening and community wildfire mitigation programs.
  • Maintained strong consumer protections: Preserved public review and justification requirements for rate increases and ensured continued oversight by one of the nation's strongest insurance regulatory frameworks as we shift from crisis response to long-term market stability.

California home insurance rates remain below the national average and far below what homeowners are paying in other states. For a standard policy with $300,000 in dwelling coverage, Florida is now the most expensive state in the country at $7,136 — 181% above the national average and 4.4 times California's rate — after regulator-approved Florida home insurance rates rose 49.5% from 2020 through 2025. Louisiana ranks second at $5,986 after a 58% increase from 2023 to 2025, while Texas averages $4,085 and the median Texas homeowner paid 60% more in 2024 than in 2019.

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California – $1,616 | National – $2,543 | Texas – $4,085 | Florida – $7,136

Accelerating recovery and protecting communities

Many survivors lost community spaces, historic neighborhood pillars, and schools that made communities feel like home. Governor Newsom and his administration have worked hand-in-hand with survivors to help communities recover and rebuild stronger. The Governor has helped accelerate the rebuilding of communities by:
  • Fast-tracking permitting and rebuilding. Governor Newsom issued an executive order to streamline the rebuilding of homes and businesses — suspending permitting and review requirements under the California Environmental Quality Act (CEQA) and the California Coastal Act. The Governor also issued an executive order further cutting red tape by reiterating that permitting requirements under the California Coastal Act are suspended for rebuilding efforts and directing the Coastal Commission not to issue guidance or take any action that interferes with or conflicts with the Governor's executive orders. Additionally, the Governor issued an executive order removing bureaucratic barriers, extending deadlines, and providing critical regulatory relief to help fire survivors rebuild, access essential services, and recover more quickly.
  • Providing tax and mortgage relief to those impacted by the fires. California postponed the individual tax filing deadline to October 15 for Los Angeles County taxpayers. Governor Newsom suspended penalties and interest on late property tax payments for a year, effectively extending the state property tax deadline. The Governor also worked with state– and federally-chartered banks that have committed to providing mortgage relief for survivors in certain zip codes, and later extended and expanded on that relief through legislation. He also announced a $125 million mortgage relief package for homeowners impacted by the Los Angeles fires and other recent disasters, which was recently adjusted to reach even more fire survivors.
  • Suspending building codes. In addition to issuing multiple executive orders, Governor Newsom has also helped speed permitting and rebuilding by suspending implementation of new building codes for residents rebuilding from the fires to create certainty and avoid the need to modify applications and lengthen the permitting process. This includes allowing homeowners who built their homes to the standards in the 2019 Building Code to use their previously approved plans, and a suspension of building codes that would have gone into effect on January 1, 2026.
  • Safeguarding survivors from speculators and price gouging. Governor Newsom expanded restrictions to protect survivors from illegal price hikes on rent, hotel and motel costs, and building materials or construction. The Governor also issued an executive order to protect firestorm victims from predatory land speculators making aggressive and unsolicited cash offers to purchase their property.
  • Getting kids back in the classroom. Governor Newsom signed an executive order to quickly assist displaced students in the Los Angeles area and bolster schools affected by the firestorms.

Trump abandons LA fire survivors

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In addition to taking action to speed rebuilding, the Governor is also standing up for the Altadena, Palisades, and Malibu communities by advocating for long-term federal disaster funding for survivors of last year's catastrophic Los Angeles wildfires.

Governor Newsom has made multiple requests since February 2025, when President Trump promised he would "take care" of survivors. However, the federal government has yet to approve these funding requests and continues to delay delivering FEMA funding which was already approved.

The federal government plays a critical role as a partner to the state in this long-term recovery effort. Funding in this supplemental appropriation would:
  • Fund the rebuilding of schools, childcare centers, homes, and vital community facilities.
  • Keep small businesses open, support the economy, and maintain jobs.
  • Restore damaged water systems, underground and harden critical infrastructure, and improve sidewalks, streets, and traffic safety.

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