USAA has paid out more than $1 billion for the Los Angeles wildfires, making it the third insurer to report $1 billion or more in payouts for the destructive blazes that burned thousands of properties.
The company, which is among the state’s top homeowners insurers, on Wednesday announced 86% of wildfire claims have received initial payments to date.
The San Antonio, Texas-based company reported more than 3,500 claims received, and is projecting it will ultimately pay out $1.8 billion in losses from the wildfires.
Insured and total losses from the January wildfires continue to rise. A report out from UCLA on Tuesday indicated that L.A. wildfire losses could be as high as $164 billion.
Preliminary data show insuers have paid out more than $4 billion for losses from the biggest two of the Los Angeles-area wildfires that swept through the region and destroyed tens of thousands of homes earlier this month.
Claims figures from insurers released by the California Department of Å˽ðÁ«´«Ã½Ó³» on Jan. 30 show that 31,210 claims have been filed for home, business, living expenses and other disaster-related needs. According to CDI, $4.2 billion in claims have been paid.
The FAIR Plan, the state’s insurer of last resort, reported it has received more than 3,200 claims as of Jan. 28 for damage caused by the Pacific Palisades Fire and more than 1,200 claims for damage caused by the Eaton Fire.
State Farm, the state’s top homeowners insurer, said it has paid nearly 10,000 claims worth roughly $500 million from home and auto damage.
State Farm Monday said it is asking the California Department of Å˽ðÁ«´«Ã½Ó³» to immediately approve interim rate increases, including . The carrier, the state’s top homeowners insurer, is partly blaming the devastating Los Angeles wildfires for the request.
Chubb said the in the first quarter.
Other carriers have yet to report on insured losses. Following State Farm, the state’s biggest homeowners insurers are Farmers Å˽ðÁ«´«Ã½Ó³» Group, Liberty Mutual Å˽ðÁ«´«Ã½Ó³» Companies, CSAA Å˽ðÁ«´«Ã½Ó³» Group, Mercury Å˽ðÁ«´«Ã½Ó³» Group, Allstate Å˽ðÁ«´«Ã½Ó³» Group, Auto Club Enterprises, USAA Group and Travelers Group, according to AM Best’s latest data.
The fires come after a year in which carriers began requesting rate hikes and they began pulling back from the wildfire-prone state. CalFire data show that seven of the state’s 10 most destructive wildfires have occurred in the last 10 years.
In response, California Å˽ðÁ«´«Ã½Ó³» Commissioner Ricardo Lara introduced his so-called Sustainable Å˽ðÁ«´«Ã½Ó³» Strategy to increase coverage in wildfire-distressed areas of the state. Lara in December announced a catastrophe modeling and ratemaking regulation that will allow carriers to use the models as a factor in setting and getting rates.
The changes to the regulations were well received by the insurance industry, but they may do little to immediately sooth the impact from the L.A. fires, which are expected to cause property insurance carriers to raise rates, reduce coverage options, or both, in California and other at-risk areas, according to S&P.
Preliminary estimates from Moody’s RMS are for insured property losses to be as much as $30 billion from the fires. Catastrophe modeler KCC said insured loss from privately insured and California FAIR plan policies to residential, commercial and industrial properties, and autos from the Palisades and Eaton Fires will be close to $28 billion.
Estimates issued by Verisk peg insured losses to property from the Palisades and Eaton fires between $28 billion and $35 billion, which includes losses to the California FAIR Plan.
The highest figures issued on insured losses so far include a high of $40 billion put out last week from Keefe Bruyette & Woods analysts. CoreLogic indicated a $35 to $45 billion range of insured losses for two major fires in Los Angeles.
USAA in an announcement about the payouts said it “is deeply committed to supporting our members during this challenging time.”
“We understand the significant impact these wildfires have on our members and their families, and by moving quickly to put money in our members’ hands, they are empowered to take the first steps towards rebuilding their lives,” Randy Termeer, president of USAA property/casualty, said in a statement. “Our team is working tirelessly to ensure that our members receive the assistance they need to recover and rebuild.”
A.M. Best Co. in January affirmed the financial strength rating (FSR) of A++ (Superior) and issuer credit ratings (ICR) of “aaa” of USAA. USAA, an acronym for United Services Automobile Association, is a financial services provider for a reported 14 million members of the military community.
Top photo: 2025 Palisades Fire. Source: CalFire.
Topics Catastrophe Natural Disasters Carriers Claims Wildfire Louisiana
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