This LA-Based Insurance Company Denied Payment On Half Its 2023 Claims

LOS ANGELES — Farmers Insurance Exchange, headquartered in the wildfire-ravaged Los Angeles area, denied payment on nearly half of the homeowners’ claims it closed in 2023, according to rating agency Weiss Ratings.

Los Angeles has suffered sweeping devastation, with at least 27 dead, thousands of structures destroyed and billions in losses in the wake of the Palisades and Eaton fires, but “for those with unimaginable losses, there is no guarantee their insurance policies will be able to provide the renumeration — at least, financially — they need,” according to Weiss.

Farmers closed 257,189 homeowners' claims in 2023, denying payment on 49.7 percent, according to Weiss, making it the company with the highest percentage of claims closed without payment that also received and closed a total of over 100,000 claims that year.

Of the 8.8 million homeowners' claims closed in 2023 across all reporting insurance companies, 37.4 percent of claims were denied payment, according to Weiss.

Farmers did not respond to a request for comment from the Los Angeles Times about Weiss’ findings.

Other large insurers high on the list for claims closed without payment in 2023 were United Services Automobile Association at 48.2 percent, USAA General Indemnity Co. at 48 percent, USAA Casualty Insurance Co. at 48 percent and Allstate Vehicle & Property Insurance Co. at 47.1 percent, according to Weiss.

Allstate disputed Weiss' data as inaccurate, saying in a statement to the Times that the data "substantially inflates the rate of unpaid claims." Insurers also argued that some claims are closed with no payment because damage did not meet the deductible or was not covered, the Times reported.