Wildfire victims call for CA insurance commissioner to resign over reported insurance loopholes

Victims of the Eaton and Palisades fires are calling for the resignation of California's insurance commissioner following a report that found loopholes that favored insurance companies.

They gathered for a news conference Thursday morning to urge Gov. Gavin Newsom to call for Commissioner Ricardo Lara to resign.

"We've all spent months reliving the trauma, listing and uploading pictures of every single item we lost, only to have our claims undervalued, delayed or denied," said wildfire survivor Jill Spivack. "Palisades families like mine are left exhausted, anxious and financially drained. Some are paralyzed in indecision, not knowing if they have the money to rebuild. Some are simply giving up."

"There's a certain point where you start to really feel the pain," said Altadena resident Cynthia Martin. She says her father, who is almost 100 years old, lost everything in the Eaton Fire. Photos, clothes, memories - all gone. She's fighting to rebuild.

"Just trying to survive and keep a house, keep a house over my father's head, my little dog and my brother who's actually completely disabled," Martin said.

The pressure on Lara comes after a recent New York Times investigation found loopholes that favored insurance companies. According to that report, Lara in 2023 struck a "quietly negotiated" deal with insurance companies, who were incentivized to drop tens of thousands of policy holders in exchange for future rate hikes.

Lara told the New York Times that the state was "bullied" by insurance companies to create those loopholes.

"Now that deal was supposed to protect Californians from the FAIR Plan. Instead, FAIR Plan Enrollment nearly doubled, and thousands of families lost coverage just before the disaster struck," said Joy Chen with the Eaton Fire survivors Network.

"Insurance companies dropped far more policies than they have promised to increase due to commissioner Lara's deal," said Carmen Balber with Consumer Watchdog.

Residents say now they are underinsured and even those with insurance are facing denials by insurance companies.

"We're tired of fighting, being denied benefits, being denied what you paid for is insane," said Altadena resident Zaire Calvin.

Lara posted the following on X:

"For 30 years under past Commissioners, no coverage guarantee of any kind existed. This is an undeniable first and we are focused on stopping the growth of the FAIR Plan and making these regulations work for those who need coverage the most."

People here say none of that is working for them now, and they need help.

"Our recovery depends on it. We are suffering. We are struggling and we just want the chance to rebuild our lives and go home," Spivack said.

The residents at the news conference on Thursday said if Lara does not resign, they want Newsom to go to legislature and ask for the legislature to impeach Lara and remove him from office.