LOS ANGELES (CNS) - State Farm, one of the largest insurers in California, announced Wednesday it will offer policy renewals to homeowners impacted by the wildfires that erupted in the Los Angeles area last week, following previous plans to drop coverage.
"We have paused the notification process on homeowner non-renewals in the areas affected by the fires," according to a statement on the insurer's website. "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."
According to the insurer, as of Wednesday morning, State Farm had received more than 7,400 home and auto insurance claims tied to the fires, and "these numbers will rise as residents return and assess damage."
The Los Angeles Times reported that State Farm's decision to offer renewals will affect about 1,100 policies in place in the 90272 ZIP code in Pacific Palisades, and untold thousands more in other neighborhoods and parts of Los Angeles County.
The move will not apply to policies that had already lapsed prior to the fires erupting on Jan. 7.
The state Department of Insurance had indicated that more than 7,600 State Farm policy holders in the Palisades Fire zone had been targeted for non-renewal, The Times reported, along with 525 in the Eaton Fire area.
"This is really an unprecedented move and State Farm is really setting the tone for other (companies) to follow," state Insurance Commissioner Ricardo Lara said during a late-afternoon appearance on KNX News. "As you know, the fires aren't extinguished yet, and so the perimeter, the border of these fires are still pending, but that's where we're still negotiating and we're also looking at what's going to be the overall size of the exposure for State Farm.
"But the fact they are renewing these policies really honors their long-term customers, so this is truly unprecedented and welcome news for our already complicated insurance market."
Lara told KNX that policy holders in the fire zone would receive one- year renewal offers, while people reporting total losses would get two.
Fire officials have estimated that as many as 5,000 structures have been damaged or destroyed in the Palisades Fire, and another 7,000 in the Eaton Fire.
Amid California's troubled insurance market, State Farm had announced in March that it would not offer renewals to about 30,000 homeowners and would also be dropping policies for rental properties.
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