Insurers Lose Billions From California Wildfires, Homeowners Left in Limbo About Rebuilding

Large insurers are reporting massive losses due to the California wildfires that burned in the Los Angeles area in January.

A State Farm insurance company sign sits amid the rubble of a building destroyed by the Palisades Fire on Sunset Boulevard in the Pacific Palisades neighborhood of Los Angeles on January 16, 2025. Tens of thousands of people ordered to flee their homes as wildfires tore through Los Angeles were told on January 16 they would not be allowed back for at least a week, with fears over electrocution, landslides and exposure to toxic materials. (Photo by Frederic J. BROWN / AFP) Photo by FREDERIC J. BROWN/AFP via Getty Images

Insurance providers Allstate, State Farm, and Chubb Insurance have claimed billions of dollars worth of losses as a result of wildfires that ravaged the Los Angeles region for most of January.

Allstate says losses related to January California wildfires will be approximately $1.1 billion, pre-tax, net of reinsurance. The insurer, which is based in Illinois, implied the losses would be worse were it not for a decision to reduce market share beginning in 2007.