Los Angeles County has opened an investigation into how the California FAIR Plan handled claims from the January 2025 Palisades and Eaton fires, county officials announced Wednesday. The FAIR Plan is now the third insurer the county is scrutinizing over its treatment of fire survivors.
County Counsel's inquiry focuses on possible violations of California's Unfair Competition Law. It follows complaints from residents who said the insurer delayed, underpaid and denied wildfire claims and refused to pay for testing and remediation of toxic contamination. County Counsel has formally notified the FAIR Plan that if it is engaging in unlawful or unfair business practices, it must stop immediately and comply with state law.
"Fire survivors who paid their premiums deserve fair and timely compensation — not delays, denials, or a choice between an unsafe home and financial devastation," said Supervisor Lindsey P. Horvath, whose district includes Pacific Palisades and Malibu. "FAIR Plan is now the third insurer Los Angeles County is investigating over its treatment of fire survivors."
Horvath said the county would "use every tool available to protect survivors and hold accountable those who fail them."
Supervisor Kathryn Barger, whose 5th District includes Altadena, said survivors there "should not be victimized yet again by their own insurance company."
"For many survivors, the FAIR Plan is the last option they have for coverage — their last recourse — and it is inexcusable that people are struggling to get the relief and recovery help they need when they need it the most," Barger said.
A July 2026 survey by the Department of Angels found that 67% of FAIR Plan customers were dissatisfied, the highest share of any insurer. FAIR Plan customers were significantly more likely than other insurers' customers to report lowball estimates, poor communication, conflicting or inaccurate information and claim denials, according to the survey. More than half of respondents said multiple adjusters had been assigned to their claims.
The FAIR Plan said it has handled about 5,400 claims from the two fires, paid nearly $3.5 billion and is reviewing the county's letter.
The California FAIR Plan Association is a private association made up of all insurers licensed to write property insurance in the state. It is funded primarily through the policies it sells and is not a state agency. It serves as an insurer of last resort for homeowners who cannot buy coverage in the traditional market.
"The homeowners who rely on FAIR Plan are more vulnerable than others because their options for insurance are severely limited," County Counsel Dawyn R. Harrison said. "FAIR Plan must treat them fairly."
County Counsel is authorized by statute to investigate and prosecute Unfair Competition Law violations on behalf of the people of California and may seek restitution, civil penalties and injunctive relief.
The FAIR Plan already faces a state case over smoke damage claims. In July 2025, the California Department of Insurance filed an order to show cause against the insurer after "hundreds of escalating consumer complaints," citing at least 418 violations tied to its "permanent physical damage" standard for smoke claims. A Los Angeles County Superior Court judge ruled that standard illegal in June 2025.
The county's action against the FAIR Plan follows similar steps against two other major insurers.
The county opened a civil investigation into State Farm General in November 2025 and sued the company Aug. 31 in Los Angeles County Superior Court, alleging unfair business practices, false advertising and suppression of smoke damage claims. Unlike the state's case against State Farm, the county suit seeks restitution for policyholders.
On Sept. 9, County Counsel opened an investigation into Farmers Insurance after policyholders said the company resisted paying for contamination testing by industrial hygienists. Farmers disputed the county's characterization.
At the state level, Insurance Commissioner Ricardo Lara opened a market conduct exam of State Farm General after the department received "general allegations" from survivor groups and a letter from lawmakers including state Sens. Sasha Renée Pérez and Ben Allen. Examiners reviewed 220 claims and found 398 violations in 114 of them, according to a May 4 department news release. The violations included failing to begin investigations within 15 days, making unreasonably low offers and failing to provide written denials for hygienist testing.
The department filed an accusation and order to show cause citing those violations plus 34 from consumer complaints. It seeks fines of up to $10,000 per willful violation and a license suspension of up to one year.
State Farm called the action "a reckless, politically motivated attack" and said added payments tied to the exam totaled "about $40,000 in the context of more than $5.7 billion paid."
No penalties have been imposed on any insurer.
Residents filed 38,835 residential claims from the fires, about 11,300 of them with State Farm, and insurers had paid more than $23.7 billion as of March 3, according to the department.