L.A. County Sued State Farm Monday. The State Found Those 398 Violations in 220 Claims.

Los Angeles County sued State Farm General Insurance Company on Monday in Los Angeles Superior Court, alleging that the insurer advertised falsely to sell policies and then delayed, underpaid and obstructed the Eaton and Palisades claims it had sold. The county is asking for restitution, an injunction, and civil penalties of up to $2,500 per violation. The number carrying most of the coverage is not the county's. It is the state's, from four months earlier: 398 violations. The state found them by reading 220 claims.

State Farm policyholders filed roughly 11,300 residential claims after the January 2025 fires — nearly a third of the 38,835 filed across all insurers, according to the California Department of Insurance's own claims tracker, cited in the department's May 4 announcement. Two hundred twenty is about one in 51 of them. That is the denominator, and naming it is not a complaint about the sample. It is what makes the sample mean anything: department examiners opened 220 files and found violations in 114 of them.

A little over half. Whatever the 398 is, it is not an inventory of everything State Farm did with 11,300 claims. It is what turned up behind the first 220 doors the state knocked on.

As quoted / in context

As quoted. The department's announcement reports that its examiners reviewed a sample of 220 claims and found 398 violations of state law across 114 of them, many of those files carrying more than one. Insurance Commissioner Ricardo Lara, in the same release: "Our investigation found that State Farm delayed, underpaid, and buried policyholders in red tape at the worst moment of their lives." Four months later the 398 is circulating largely on its own, as a total.

In context. The department's 398 is a total of one thing — violations its examiners found inside a 220-file random sample — and it is silent about everything outside that sample in both directions. Run the division and the sample rate is what does the arguing: 114 of 220 is 51.8%, which CalMatters, reporting the filing in May, rounded to 52%. If that rate held across all 11,300 residential claims it would describe something on the order of 5,800 files. Nobody has established that it holds, the department has not projected it, and we are not projecting it either. We are noting that the reassuring reading of a small sample and the alarming one point in opposite directions, and that only one of them is doing any work in the coverage.

One precision note, because this column exists to make them. The department's Accusation and Order to Show Cause alleges the 398 examination violations plus 34 more drawn from consumer complaints, which adds to 432; CalMatters reported the total as 430. We use the department's two component figures rather than either total, because those are the ones it published as findings.

What it excludes

• The roughly 11,080 residential claims nobody examined. A market conduct examination is a sample by design and the department says so. It is the basis for an enforcement filing, not a census of a book of business, and every claim outside the 220 is neither cleared nor charged. This is the single most common thing done wrong with the number: it is read as a score for State Farm's fire response, and it is a score for 220 files.
• Everything filed with somebody other than the state. The county's Monday complaint carries no violation count at all. It describes practices — false advertising, unreasonable delay, systematic underpayment, repeated adjuster reassignment, refusal of additional living expenses, suppression of smoke damage claims — and leaves the arithmetic to discovery. A $2,500-per-violation penalty with no published numerator is not a small number or a large one yet. It is an unfilled blank.
• What State Farm is counting when it answers. The company's response is a different base: more than 13,700 fire-related claims, $6.2 billion paid including about $1 billion on smoke damage, and about 78% of claims closed, figures it gave Insurance Journal on Tuesday. The department's 11,300 is residential; the company's 13,700 is fire-related and larger. The two totals are not the same population and neither side is obliged to use the other's. On the company's own figure, 78% closed leaves roughly 3,000 claims open twenty months after the fires.
• Smoke, which is most of the argument and almost none of the number. The department reports that smoke damage claims represented nearly half of all consumer complaints. A complaint is not a violation and the two counts are kept separately; the 34 extra violations in the Accusation are all the department drew from the complaint track. The category generating the most grievance contributes the smallest of the published figures.

The number underneath

Set the penalty against the payout and the scale problem is visible without adjectives. Under Insurance Code section 790.035, the department may seek up to $5,000 per violation and $10,000 for a willful one. Multiply by the 398 and the 34 together and the ceiling runs from about $2.2 million to about $4.3 million — the range CalMatters put at $2 million to $4.3 million. State Farm says it has paid $6.2 billion on these fires. The maximum administrative fine is roughly seven hundredths of one percent of that.

Which is why the money is not the leverage. The department is also seeking to suspend State Farm's certificate of authority — its license to write insurance in California — for one year, CalMatters reported. No hearing before an administrative law judge has been scheduled. The state's case has been pending since May 4; the county's is one day old.

State Farm has answered both. On the department's filing, the company called it a "reckless, politically motivated attack that could ultimately cripple" the homeowners market and characterized the findings as "primarily administrative and procedural errors," per CalMatters. On the county's suit, spokesperson Bob Devereux told Insurance Journal that "State Farm General strongly disagrees with Los Angeles County's characterization of our wildfire claims response." None of the allegations on either side has been tested by a judge.

The county's own case rests on the same fires and a different theory. Supervisor Kathryn Barger, in the county's announcement: "Wildfire survivors have already endured unimaginable loss; they should not have to fight their insurance company simply to receive the benefits they paid for and counted on." Supervisor Lindsey P. Horvath, in the same release, said county residents have paid the insurer millions in premiums over many years and that "the company has a clear obligation to honor its policies in full." The San Francisco Chronicle, which reported the filing Monday evening, describes a public nuisance count as well — the county's argument that leaving survivors unable to return or rebuild harms the county itself, not only its policyholders.

For scale on what has actually moved: as of March 3, 2026, insurers had paid more than $23.7 billion to residential, commercial and auto policyholders across these fires, and the department says it has recovered more than $280 million from all insurers by intervening directly in individual claims. That last figure is the one nobody quotes, and it is the only number here describing money that reached somebody because a regulator picked up a phone.

The verdict

398 is correct, it is the department's own published finding, and it is not a rate. Its denominator is 220 — about one in 51 of State Farm's residential fire claims — and the finding that travels with it is that 114 of those 220 files, a little over half, carried at least one violation. Cite the pair or cite neither. A raw violation count with the sample size stripped off can be waved away as small or brandished as huge, which is exactly what has been happening since May, in both directions, by people who do not know they are arguing about a sample.

The county's suit, filed Monday, has no violation count yet. When it produces one, it will have a denominator too, and it will not be 220. The first question to ask of that number is the same one: out of how many.

Divide responsibly.