A Glimmer of Hope Turns to Frustration: The Broken US Insurance System Exposed by LA Wildfires
Jessica and Matt Conkle thought they had seen a glimmer of hope after their midcentury ranch home was lost to the Los Angeles wildfires. Their insurance company, State Farm, had sent emergency response teams and filed a claim right away. However, the process quickly bogged down as they were forced to negotiate over the value of each lost possession with multiple claims adjusters, only to have to start again with another adjuster and then a third.
The Conkles' experience is not unique, as recent reports by Department of Angels, a non-profit set up by government experts in the wake of the fires, echoed their frustration. Almost eight out of 10 surveyed homeowners reported various obstacles, including multiple adjusters, lowball estimates, fights over property lists, and poor communication.
Fire survivors seeking to collect on their insurance policies in other fire-ravaged neighborhoods across the LA region report similar frustrations. The struggle is a sign of how Los Angeles's post-fire recovery has exemplified a broader crisis facing the US insurance industry in an age of climate volatility, raising troubling questions about the stability of home ownership and housing affordability – the bedrock of the American middle class.
The insurance industry has never had it better, with record profits of $169bn last year and on target for another bonanza year in 2025. However, this disparity between insurers and customers infuriates fire survivors like the Conkles, fueling a movement to demand an end to the industry's lobbying grip on state regulators and lawmakers, and a more equitable solution that spreads the undeniable risks associated with climate change more broadly.
State Farm is at the center of the controversy, with the company offering no response to specific criticisms from the Conkles. The insurance industry itself insists it is working diligently to process claims, but advocates accuse them of over-emphasizing fluctuations in income based on the difference between premiums and claims when in fact they make most of their revenue and profits in the markets.
Consumer advocates point to other states with less regulation as an example, where insurance companies have imposed dramatic price increases and still canceled policies at an alarming rate. They also criticize California's department of insurance for being "captured" by corporate interests and failing to enforce existing laws or impose meaningful new regulations.
The crisis is not just about individual insurers but a systemic issue, with catastrophic events becoming more common and likely to become dramatically worse as global temperatures increase. The global insurance industry saw $145bn in underwriting losses from natural catastrophes last year, a figure that exceeded the 21st-century annual average by a staggering 54%. Losses in 2025 were greater than $100bn in the first half of the year alone.
Experts argue that this is not a business-as-usual issue but an insurmountable challenge that requires systemic change. Dave Jones, who served as California's insurance commissioner and now leads a climate risk thinktank at the University of California, believes that insurance companies should use their clout as institutional investors and divest from fossil-fuel companies. He also advocates for stronger protections to ensure access to insurance in the first place and regular updates on the cost of rebuilding in cases of total loss.
However, even with a more responsible industry behavior, Jones sees a future of much higher prices and dramatically scaled-back coverage in high-risk areas, with state governments possibly stepping in to provide home insurance subsidies to lower-income families.
Jessica and Matt Conkle thought they had seen a glimmer of hope after their midcentury ranch home was lost to the Los Angeles wildfires. Their insurance company, State Farm, had sent emergency response teams and filed a claim right away. However, the process quickly bogged down as they were forced to negotiate over the value of each lost possession with multiple claims adjusters, only to have to start again with another adjuster and then a third.
The Conkles' experience is not unique, as recent reports by Department of Angels, a non-profit set up by government experts in the wake of the fires, echoed their frustration. Almost eight out of 10 surveyed homeowners reported various obstacles, including multiple adjusters, lowball estimates, fights over property lists, and poor communication.
Fire survivors seeking to collect on their insurance policies in other fire-ravaged neighborhoods across the LA region report similar frustrations. The struggle is a sign of how Los Angeles's post-fire recovery has exemplified a broader crisis facing the US insurance industry in an age of climate volatility, raising troubling questions about the stability of home ownership and housing affordability – the bedrock of the American middle class.
The insurance industry has never had it better, with record profits of $169bn last year and on target for another bonanza year in 2025. However, this disparity between insurers and customers infuriates fire survivors like the Conkles, fueling a movement to demand an end to the industry's lobbying grip on state regulators and lawmakers, and a more equitable solution that spreads the undeniable risks associated with climate change more broadly.
State Farm is at the center of the controversy, with the company offering no response to specific criticisms from the Conkles. The insurance industry itself insists it is working diligently to process claims, but advocates accuse them of over-emphasizing fluctuations in income based on the difference between premiums and claims when in fact they make most of their revenue and profits in the markets.
Consumer advocates point to other states with less regulation as an example, where insurance companies have imposed dramatic price increases and still canceled policies at an alarming rate. They also criticize California's department of insurance for being "captured" by corporate interests and failing to enforce existing laws or impose meaningful new regulations.
The crisis is not just about individual insurers but a systemic issue, with catastrophic events becoming more common and likely to become dramatically worse as global temperatures increase. The global insurance industry saw $145bn in underwriting losses from natural catastrophes last year, a figure that exceeded the 21st-century annual average by a staggering 54%. Losses in 2025 were greater than $100bn in the first half of the year alone.
Experts argue that this is not a business-as-usual issue but an insurmountable challenge that requires systemic change. Dave Jones, who served as California's insurance commissioner and now leads a climate risk thinktank at the University of California, believes that insurance companies should use their clout as institutional investors and divest from fossil-fuel companies. He also advocates for stronger protections to ensure access to insurance in the first place and regular updates on the cost of rebuilding in cases of total loss.
However, even with a more responsible industry behavior, Jones sees a future of much higher prices and dramatically scaled-back coverage in high-risk areas, with state governments possibly stepping in to provide home insurance subsidies to lower-income families.
. I mean, you'd think that after all the disasters we're having, like LA wildfires, the industry would be more prepared and responsive to claims. But nope, it's still a total mess 
. The fact that State Farm is being criticized for their handling of the Conkle's claim is just the tip of the iceberg. It's clear that the system is broken and needs a major overhaul 
.
), but not at the expense of people who are already struggling to recover from disasters. And let's be real, climate change is no joke 
. We need systemic changes that prioritize affordability and access over profit margins.
. I'd love to see more regulation around lobbying and fewer price hikes in high-risk areas 
. We need to find ways to support homeowners, especially low-income families, who are already struggling to get back on their feet 
.
State Farm is just taking advantage of people who are already going through hell. I mean, $169bn profits last year? Are you kidding me?! Meanwhile, homeowners are struggling to get their claims processed and are being lowballed on the value of their possessions. It's just not right 
And don't even get me started on the lobbying grip the insurance industry has on state regulators and lawmakers. We need real change here, like more equitable solutions that spread the risks associated with climate change more broadly 
it's like trying to get blood from a stone 
after a huge wildfire 
. I'm not surprised that most homeowners are getting frustrated 
with multiple adjusters, lowball estimates 
and poor communication 
. It's just not right 
.
is infuriating 
. I think it's time for the government to step in 
and regulate the industry more strictly 
. We need stronger protections for homeowners and a more equitable solution 
and how it's affecting our insurance system 
. It's not just about individual companies, it's about systemic change 
. We need to hold insurance companies accountable 
and make sure they're not prioritizing profits over people 
.
. Like when you're trying to get a refund from a store but they keep sending you to different reps who just say "can't help you" 
. We need more transparency and accountability from these companies, and maybe even some incentives for them to take a more sustainable approach to business 
. And honestly, if that means higher prices or less coverage in high-risk areas, i'm still down with supporting policies that help low-income families get the insurance they need 
That's just not cool.