A wildfire survivors’ group, Every Fire Survivors Network, is pushing for tougher penalties against State Farm over its handling of January 2025 wildfire claims and seeks to join a state enforcement action to secure reforms and compensation for victims.

The network seeks party status in the investigation to influence settlement terms, calling for a broader review of claims, higher payouts, and stricter penalties to address slow payouts harming recovery.

Marjan Rajabi of Pacific Palisades—whose payout covers only a portion of rebuilding costs—is part of a larger community effort to intervene in the California Department of Insurance’s probe into State Farm’s wildfire-claims handling.

The dispute highlights tensions between regulatory action and State Farm’s roughly 20% market share in California’s home-insurance market, with skepticism about license suspension viability.

State Farm denies systemic blame, attributes issues to individual adjusters in some cases, and pledges improvements in claims handling, including single points of contact and better communication.

The petition argues the market conduct exam sample was too small, seeking discovery, cross-examination of witnesses, and inclusion of more than 1,600 firsthand policyholder statements to evidence broader systemic issues.

California’s investigation identified 398 violations across 220 State Farm claims, with slow investigations, underpayment, denials, and poor communication, potentially resulting in fines up to $2 million and even license suspension.

The May enforcement action followed a market conduct examination uncovering state-law violations in about half of sampled claims, including inadequate investigations, delayed or unfair settlements, and unreasonably low offers.

State Farm says it has paid $5.9 billion in claims to Eaton and Palisades survivors and highlights ongoing efforts like single points of contact and improved communication within a challenging California market.

January 2025 wildfires damaged or destroyed more than 18,000 structures and killed 31 people, with State Farm handling more January 2025 claims than any other insurer in California and more than 13,700 auto and homeowners claims through May 4, totaling about $5.7 billion paid.

Rajabi, whose payout covers only 65% of rebuilding costs, embodies the human toll of slow or insufficient insurer responses and seeks full compensation.

Consumer Watchdog is providing legal support for victims, while State Farm says the department’s actions aim to aid survivors’ ongoing recovery.