California orders lenders to report on fire insurance payout handling

Summarised from 2 outlets · Updated 15 Oct, 18:32 · Archive

California officials are ordering mortgage lenders to report on how they have handled insurance payouts to survivors of the 2025 Los Angeles-area fires.

California officials are ordering mortgage lenders, including banks and credit unions, to report on how they have handled insurance payouts to survivors of the 2025 Los Angeles-area fires. The California Business and Consumer Services Agency and the Department of Financial Protection and Innovation are seeking to speed up the release of insurance proceeds that lenders hold before distributing them to homeowners. The state has received more than 160 complaints about payment delays or other issues since January 2025 and is giving lenders two weeks to submit their reports.

The Palisades and Eaton fires destroyed more than 16,000 homes and other structures as they tore through residential neighbourhoods in and around Los Angeles. Governor Gavin Newsom wrote to bankers' associations and credit unions in July, noting that fire victims rebuilding their homes reported lenders sometimes holding on to insurance payouts for weeks before releasing them. He ordered the state to collect data on lenders that take longer than 10 days to distribute insurance proceeds and fail to develop a plan to speed up payouts. Newsom signed a law requiring banks and credit unions to pay homeowners interest on insurance payments they hold.

Rohit Chopra, secretary of the Business and Consumer Services Agency, said: 'It's unacceptable that after running through a gauntlet of paperwork to file insurance claims, some wildfire survivors still have not gotten access to the funds they need to rebuild.' Very few homes have been rebuilt since the fires.

How it is being reported

• California orders lenders to report on their handling of insurance payouts to LA fire survivorsCalifornia officials are ordering mortgage lenders to report on how they've handled insurance payouts to survivors of the 2025 Los Angeles-area fires.Clickorlando · 15 Oct, 18:01
• California orders lenders to report on their handling of insurance payouts to LA fire survivorsCalifornia officials are ordering mortgage lenders to report on how they've handled insurance payouts to survivors of the 2025 Los Angeles-area fires.News4Jax · 15 Oct, 18:01

In this story: California · Los Angeles · Gavin Newsom · Rohit Chopra · Department of Financial Protection and Innovation

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