In late July 2025, the DOI filed an action against FAIR Plan after receiving numerous consumer complaints showing a pattern of denying smoke damage claims (Case No. DISP-2025-00281). It is the result of a multi-year investigation which discovered 418 violations. FAIR Plan is challenging the allegations.

There have been some interesting developments on the litigation front as well:

Gharibian v. Wawanesa General Insurance Co. (Cal. Ct. App., 2d Dist., Div. 2, Feb. 2025), 108 Cal.App.5th 730: Court affirmed summary judgment for Wawanesa, holding wildfire debris did not constitute “direct physical loss” as it was removable and caused no lasting alteration (citing Another Planet v. Vigilant Ins. Co., 15 Cal.5th 1106 (2024)).
McGranahan v. GEICO Indemnity Co. (9th Cir., Mar. 2025), 2025 WL 869306: Ninth Circuit affirmed summary judgment for GEICO, holding insurer acted reasonably by requesting medical records before responding to a time-limited demand.
Aliff v. California FAIR Plan Ass’n (L.A. Super. Ct., June 24, 2025), No. 21STCV20095: The court granted summary adjudication finding that certain provisions of the FAIR Plan police were “unlawful.” The Court concluded “[t]he CFP Policy’s definition of ‘direct physical loss’ as ‘actual loss or physical damage, evidenced by permanent physical changes’ is unlawful under Ins. Code § 2070, in that this language limits coverage to be less favorable than and not substantially equivalent to the Standard Form Policy contained in Ins. Code § 2071.”
State Farm Fire & Casualty Co. v. Diblin (Cal. Ct. App., 4th Dist., Oct. 7, 2025), 114 Cal.App.5th 1245: Court held injuries from insured’s intentional gender-abusive conduct were not an “accident” and thus not a covered “occurrence.” Once to watch.
The California Supreme Court has a review pending in 11640 Woodbridge Condominium Homeowners’ Ass’n v. Farmers Ins. Exch., 110 Cal.App.5th 211 (2025), The California Supreme Court granted review in July 2025, a decision is expected in 2026.At issue is whether a provision in an “all-risk” property insurance policy covers water damage to the interior of a building caused by rain that entered while the roof was being repaired.

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