Latest news with #MichaelJ.Bidart
Yahoo
3 days ago
- Business
- Yahoo
New lawsuits accuse insurance companies of secret scheme to drive up prices for homeowners: 'Conspiracy and collusion'
Two lawsuits filed in Los Angeles say insurance companies colluded to force homeowners in high-risk wildfire areas onto California's FAIR insurance plans. According to the Associated Press, the lawsuits want to hold 25 major insurance companies responsible for the "illegal scheme" that has limited coverage for homeowners. The filings say their practices are "in violation of California's unfair competition and antitrust laws." The lawsuits allege that the insurance companies, including State Farm, worked together in 2023 to deny high-risk policies, making the FAIR Plan many homeowners' only option. The FAIR Plan is California's insurer of last resort. It's a program that gives high-risk homeowners access to insurance policies if they're denied through traditional avenues. These high-premium policies offer basic and limited coverage capped at $3 million. These policies are not enough to cover damage caused by severe disasters. And disaster struck in January, with extreme wildfires that destroyed almost 17,000 structures. Countless homeowners were left underinsured on the FAIR Plan. Many people can't get a traditional policy because the insurance companies don't want to be financially responsible for these natural disasters. Wildfires, droughts, floods, and other extreme weather events are becoming more frequent. By denying coverage in areas prone to climate instability, they're prioritizing profits. Furthermore, over $500 billion of U.S. insurance companies' investments are in the oil and gas industry, per the Center for International Environmental Law. Burning oil and gas creates harmful emissions that destabilize climate conditions. This leads to extreme weather events that destroy homes and leave people in financial ruin. Michael J. Bidart, who represents the homeowners, said in a statement, per AP: The insurance companies "have reaped the benefits of high premiums while depriving homeowners of coverage that they were ready, willing, and able to purchase to ensure that they could recover after a disaster like January's wildfires." Insurance companies are denying coverage to boost profits while making money off the very practices that are causing climate instability. Do you think America is in a housing crisis? Definitely Not sure No way Only in some cities Click your choice to see results and speak your mind. Bankrate advises homeowners to save claims for major losses, check dwelling coverage, and be proactive about caring for their property. But people are hopeful these lawsuits will help reinstate fair premiums and policies. According to Bankrate, Stephen G. Larson, another lawyer representing the homeowners, said: "California's antitrust and unfair competition laws exist to address the very kind of conspiracy and collusion that the complaints allege the defendants engaged in." Join our free newsletter for good news and useful tips, and don't miss this cool list of easy ways to help yourself while helping the planet.
CBS News
22-04-2025
- Business
- CBS News
Insurers colluded to limit coverage in California areas at high risk for wildfires, lawsuits allege
Sacramento — Two lawsuits filed in Los Angeles allege major home insurance companies have colluded to limit coverage in California communities at high risk for wildfires and force homeowners onto the state's last-resort insurance plan that offers basic coverage and high premiums. Insurers, including State Farm and 24 other companies that hold 75% of California's home insurance market, were part of an "illegal scheme" in violation of California's antitrust and unfair competition laws, according to one of the lawsuits, filed last week. The lawsuit said the companies worked together in 2023 to "suddenly and simultaneously" drop coverage or halt writing new policies in fire-prone areas, including in neighborhoods like Pacific Palisades and Altadena that were leveled in the January wildfires that destroyed nearly 17,000 structures and killed at least 30 people. That's forced hundreds of homeowners onto the FAIR Plan that offers limited coverage capping at $3 million, leaving them underinsured and now struggling to rebuild after the fires, says the lawsuit filed by a group of homeowners who lost their houses in the L.A. fires. The other lawsuit includes all policyholders who obtained the FAIR Plan after January 2023, when the conspiracy allegedly began, the suit says. "Insurance is a product that homeowners hope never to need, but rely on for peace of mind in normal times and for critical help rebuilding after a catastrophe," Michael J. Bidart, who represents the homeowners, said in a statement. "The complaints allege that, by colluding to push plaintiffs and so many like them to the FAIR Plan, the defendants have reaped the benefits of high premiums while depriving homeowners of coverage that they were ready, willing, and able to purchase to ensure that they could recover after a disaster like January's wildfires." The lawsuits come as California is struggling with an ongoing insurance crisis, where companies are boosting rates, limiting coverage or pulling out completely from regions susceptible to wildfires and other natural disasters. In 2023, several major insurance companies either paused or restricted new business in the state, saying they can't truly price the risk on properties as wildfires become more common and destructive due to climate change . The American Property Casualty Insurance Association, the largest national trade association representing home, auto and business insurers, said it complies with the state's antitrust laws and monitors its members to ensure they do the same. "These suits defy logic, advance meritless claims, and we are going to focus on solving the challenges in the insurance market in California," said Stef Zielezienski, the group's chief legal officer. The state Department of Insurance said it isn't involved in the suits but said its focus is on protecting consumers. "Californians deserve a system that works - one where decisions are made openly, rates reflect real risk, and no one is left without options," department spokesperson Gabriel Sanchez said in a statement. State Farm, the largest home insurer in California with roughly a million policies, didn't immediately respond to requests for comment. The FAIR Plan is an insurance pool that all the major private insurers pay into. The plan issues policies to people who can't get private insurance because their properties are deemed too risky to insure. The plan, with high premiums and basic coverage, is designed as a temporary option until homeowners can find permanent coverage, but more Californians are relying on it than ever. There were more than 555,000 home policies on the FAIR Plan as of March, more than double the number in 2020. The complaints also allege that insurers were pushing policyholders onto the FAIR Plan because companies wouldn't have to shoulder all financial responsibility to sustain the plan. When the state's top insurance regulator in February ordered insurers to provide $1 billion to the FAIR Plan to help it pay out claims related to the L.A. wildfires, he allowed for half of the cost to be recouped from policyholders statewide. Another lawsuit was filed last week to block the cost-shifting regulation. California has been in the process of implementing various new regulations to give insurers more latitude to raise premiums in exchange for issuing more policies in high-risk areas. That includes regulations allowing insurers to consider climate change when setting their prices and allowing them to pass on the costs of reinsurance to California consumers.
Business Mayor
22-04-2025
- Business
- Business Mayor
Lawsuits accuse insurers of colluding to drop coverage in fire-prone parts of California
For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Two lawsuits filed in Los Angeles allege major home insurance companies have colluded to limit coverage in California communities at high risk for wildfires and force homeowners onto the state's last-resort insurance plan that offers basic coverage and high premiums. Insurers, including State Farm and 24 other companies that hold 75% of California's home insurance market, were part of an 'illegal scheme' in violation of California's antitrust and unfair competition laws, according to one of the lawsuits, filed last week. The lawsuit said the companies worked together in 2023 to 'suddenly and simultaneously' drop coverage or halt writing new policies in fire-prone areas, including in neighborhoods like Pacific Palisades and Altadena that were leveled in the January wildfires that destroyed nearly 17,000 structures and killed at least 30 people. That has forced hundreds of homeowners onto the FAIR Plan that offers limited coverage capping at $3 million, leaving them underinsured and now struggling to rebuild after the fires, says the lawsuit filed by a group of homeowners who lost their houses in the LA fires. The other lawsuit includes all policyholders who obtained the FAIR Plan after January 2023, when the conspiracy allegedly began, the suit says. 'Insurance is a product that homeowners hope never to need, but rely on for peace of mind in normal times and for critical help rebuilding after a catastrophe,' Michael J. Bidart, who represents the homeowners, said in a statement. 'The complaints allege that, by colluding to push plaintiffs and so many like them to the FAIR Plan, the defendants have reaped the benefits of high premiums while depriving homeowners of coverage that they were ready, willing, and able to purchase to ensure that they could recover after a disaster like January's wildfires.' The lawsuits come as California is struggling to rein in an ongoing insurance crisis, where companies are boosting rates, limiting coverage or pulling out completely from regions susceptible to wildfires and other natural disasters in the era of climate change. In 2023, several major insurance companies either paused or restricted new business in the state, saying they can't truly price the risk on properties as wildfires are becoming more common and destructive in California due to climate change. The state Department of Insurance said it is not involved in the suits but said its focus is on protecting consumers. 'Californians deserve a system that works — one where decisions are made openly, rates reflect real risk, and no one is left without options,' department spokesperson Gabriel Sanchez said in a statement. State Farm, the largest home insurer in California with roughly a million policies, didn't immediately respond to requests for comment. Representatives from the American Property Casualty Insurance Association, the largest national trade association representing home, auto and business insurers, also did not respond for comment. The FAIR Plan is an insurance pool that all the major private insurers pay into, and the plan then issues policies to people who can't get private insurance because their properties are deemed too risky to insure. The plan, with high premiums and basic coverage, is designed as a temporary option until homeowners can find permanent coverage, but more Californians are relying on it than ever. There were more than 555,000 home policies on the FAIR Plan as of March, more than double the number in 2020. Read More Tell 'price walkers' to take a hike The complaints also allege that insurers were pushing policyholders onto the FAIR Plan because companies wouldn't have to shoulder all financial responsibility to sustain the plan. When the state's top insurance regulator in February ordered insurers to provide $1 billion to the FAIR Plan to help it pay out claims related to the LA wildfires, he allowed for half of the cost to be recouped from policyholders statewide. Another lawsuit was filed last week to block the cost-shifting regulation. California has been in the process of implementing various new regulations to give insurers more latitude to raise premiums in exchange for issuing more policies in high-risk areas. That includes regulations allowing insurers to consider climate change when setting their prices and allowing them to pass on the costs of reinsurance to California consumers.
The Hill
22-04-2025
- Business
- The Hill
Lawsuits accuse insurers of colluding to drop coverage in fire-prone parts of California
SACRAMENTO, Calif. (AP) — Two lawsuits filed in Los Angeles allege major home insurance companies have colluded to limit coverage in California communities at high risk for wildfires and force homeowners onto the state's last-resort insurance plan that offers basic coverage and high premiums. Insurers, including State Farm and 24 other companies that hold 75% of California's home insurance market, were part of an 'illegal scheme' in violation of California's antitrust and unfair competition laws, according to one of the lawsuits, filed last week. The lawsuit said the companies worked together in 2023 to 'suddenly and simultaneously' drop coverage or halt writing new policies in fire-prone areas, including in neighborhoods like Pacific Palisades and Altadena that were leveled in the January wildfires that destroyed nearly 17,000 structures and killed at least 30 people. That has forced hundreds of homeowners onto the FAIR Plan that offers limited coverage capping at $3 million, leaving them underinsured and now struggling to rebuild after the fires, says the lawsuit filed by a group of homeowners who lost their houses in the LA fires. The other lawsuit includes all policyholders who obtained the FAIR Plan after January 2023, when the conspiracy allegedly began, the suit says. 'Insurance is a product that homeowners hope never to need, but rely on for peace of mind in normal times and for critical help rebuilding after a catastrophe,' Michael J. Bidart, who represents the homeowners, said in a statement. 'The complaints allege that, by colluding to push plaintiffs and so many like them to the FAIR Plan, the defendants have reaped the benefits of high premiums while depriving homeowners of coverage that they were ready, willing, and able to purchase to ensure that they could recover after a disaster like January's wildfires.' The lawsuits come as California is struggling with an ongoing insurance crisis, where companies are boosting rates, limiting coverage or pulling out completely from regions susceptible to wildfires and other natural disasters. In 2023, several major insurance companies either paused or restricted new business in the state, saying they can't truly price the risk on properties as wildfires become more common and destructive due to climate change. The American Property Casualty Insurance Association, the largest national trade association representing home, auto and business insurers, said it complies with the state's antitrust laws and monitors its members to ensure they do the same. 'These suits defy logic, advance meritless claims, and we are going to focus on solving the challenges in the insurance market in California,' said Stef Zielezienski, the group's chief legal officer. The state Department of Insurance said it is not involved in the suits but said its focus is on protecting consumers. 'Californians deserve a system that works — one where decisions are made openly, rates reflect real risk, and no one is left without options,' department spokesperson Gabriel Sanchez said in a statement. State Farm, the largest home insurer in California with roughly a million policies, didn't immediately respond to requests for comment. The FAIR Plan is an insurance pool that all the major private insurers pay into. The plan issues policies to people who can't get private insurance because their properties are deemed too risky to insure. The plan, with high premiums and basic coverage, is designed as a temporary option until homeowners can find permanent coverage, but more Californians are relying on it than ever. There were more than 555,000 home policies on the FAIR Plan as of March, more than double the number in 2020. The complaints also allege that insurers were pushing policyholders onto the FAIR Plan because companies wouldn't have to shoulder all financial responsibility to sustain the plan. When the state's top insurance regulator in February ordered insurers to provide $1 billion to the FAIR Plan to help it pay out claims related to the LA wildfires, he allowed for half of the cost to be recouped from policyholders statewide. Another lawsuit was filed last week to block the cost-shifting regulation. California has been in the process of implementing various new regulations to give insurers more latitude to raise premiums in exchange for issuing more policies in high-risk areas. That includes regulations allowing insurers to consider climate change when setting their prices and allowing them to pass on the costs of reinsurance to California consumers.
The Independent
21-04-2025
- Business
- The Independent
Lawsuits accuse insurers of colluding to drop coverage in fire-prone parts of California
Two lawsuits filed in Los Angeles allege major home insurance companies have colluded to limit coverage in California communities at high risk for wildfires and force homeowners onto the state's last-resort insurance plan that offers basic coverage and high premiums. Insurers, including State Farm and 24 other companies that hold 75% of California's home insurance market, were part of an 'illegal scheme' in violation of California's antitrust and unfair competition laws, according to one of the lawsuits, filed last week. The lawsuit said the companies worked together in 2023 to 'suddenly and simultaneously' drop coverage or halt writing new policies in fire-prone areas, including in neighborhoods like Pacific Palisades and Altadena that were leveled in the January wildfires that destroyed nearly 17,000 structures and killed at least 30 people. That has forced hundreds of homeowners onto the FAIR Plan that offers limited coverage capping at $3 million, leaving them underinsured and now struggling to rebuild after the fires, says the lawsuit filed by a group of homeowners who lost their houses in the LA fires. The other lawsuit includes all policyholders who obtained the FAIR Plan after January 2023, when the conspiracy allegedly began, the suit says. ' Insurance is a product that homeowners hope never to need, but rely on for peace of mind in normal times and for critical help rebuilding after a catastrophe,' Michael J. Bidart, who represents the homeowners, said in a statement. 'The complaints allege that, by colluding to push plaintiffs and so many like them to the FAIR Plan, the defendants have reaped the benefits of high premiums while depriving homeowners of coverage that they were ready, willing, and able to purchase to ensure that they could recover after a disaster like January's wildfires.' The lawsuits come as California is struggling to rein in an ongoing insurance crisis, where companies are boosting rates, limiting coverage or pulling out completely from regions susceptible to wildfires and other natural disasters in the era of climate change. In 2023, several major insurance companies either paused or restricted new business in the state, saying they can't truly price the risk on properties as wildfires are becoming more common and destructive in California due to climate change. The state Department of Insurance said it is not involved in the suits but said its focus is on protecting consumers. 'Californians deserve a system that works — one where decisions are made openly, rates reflect real risk, and no one is left without options,' department spokesperson Gabriel Sanchez said in a statement. State Farm, the largest home insurer in California with roughly a million policies, didn't immediately respond to requests for comment. Representatives from the American Property Casualty Insurance Association, the largest national trade association representing home, auto and business insurers, also did not respond for comment. The FAIR Plan is an insurance pool that all the major private insurers pay into, and the plan then issues policies to people who can't get private insurance because their properties are deemed too risky to insure. The plan, with high premiums and basic coverage, is designed as a temporary option until homeowners can find permanent coverage, but more Californians are relying on it than ever. There were more than 555,000 home policies on the FAIR Plan as of March, more than double the number in 2020. The complaints also allege that insurers were pushing policyholders onto the FAIR Plan because companies wouldn't have to shoulder all financial responsibility to sustain the plan. When the state's top insurance regulator in February ordered insurers to provide $1 billion to the FAIR Plan to help it pay out claims related to the LA wildfires, he allowed for half of the cost to be recouped from policyholders statewide. Another lawsuit was filed last week to block the cost-shifting regulation. California has been in the process of implementing various new regulations to give insurers more latitude to raise premiums in exchange for issuing more policies in high-risk areas. That includes regulations allowing insurers to consider climate change when setting their prices and allowing them to pass on the costs of reinsurance to California consumers.
