Regulatory Authority Prohibits California Operations for Insurance Firm
In a series of recent actions, the California Department of Insurance and Insurance Commissioner Ricardo Lara have taken significant steps to protect consumers and address insurance-related issues in the state.
Investigation Reveals Health Coverage Fraud
Innovative Partners, LP, a company based in California, has been under investigation for defrauding consumers by selling limited or non-existent health coverage. Thousands of consumers were misled into believing they were purchasing comprehensive insurance plans, only to find out later that their claims were improperly denied or that they had no real coverage at all.
Commissioner Lara issued a Cease and Desist Order against Innovative Partners, LP on July 15, 2025, prohibiting them from operating as an insurance company in California. The Department of Insurance also served 10 other Cease and Desist Orders to related entities and individuals that facilitated the fraudulent scheme.
Investigation into State Farm's Claims Handling
The California Regulator has announced an investigation into State Farm's handling of thousands of insurance claims from wildfire survivors affected by the Palisades and Eaton wildfires. The investigation is aimed at ensuring that State Farm is fairly and appropriately handling the claims of affected homeowners and businesses.
Addressing High Wildfire Insurance Costs
In a separate initiative, Commissioner Lara is enforcing a new regulation in California to control the cost of wildfire insurance. The regulation, the first of its kind in the nation, recognizes and rewards wildfire safety and mitigation efforts made by homeowners and businesses.
Consumer Assistance and Ongoing Scrutiny
Consumers who believe they have been affected by the fraudulent activities of Innovative Partners, LP are encouraged to contact the California Department of Insurance for assistance. Similarly, those experiencing issues with their insurance claims, particularly related to medical benefits, are also encouraged to reach out for help.
The investigations into both Innovative Partners, LP and State Farm are ongoing, with the Department of Insurance conducting a Market Conduct Examination of State Farm as part of the investigation announced by Commissioner Lara. The Department will continue to scrutinize related entities involved in the schemes and take further action as necessary to protect California consumers.
[1] California Department of Insurance Press Release: https://www.insurance.ca.gov/07152025/ [2] Consumer Reports: https://www.consumerreports.org/health-insurance/california-consumers-fraudulently-sold-limited-health-coverage-by-innovative-partners-lp/ [3] KQED News: https://www.kqed.org/news/11724137/california-regulator-investigates-state-farm-over-handling-of-wildfire-claims [4] Better Business Bureau: https://www.bbb.org/us/ca/sacramento/profile/insurance-agency/innovative-partners-0664-90011142
- The property insurance industry, specifically State Farm, is under investigation by the California Department of Insurance for their claims handling practices following thousands of claims from wildfire survivors.
- Regulation in the banking-and-insurance sector of California is being tightened, as Commissioner Lara enforces a new rule to control the cost of property insurance, recognizing and rewarding wildfire safety and mitigation efforts by homeowners and businesses.
- The ongoing investigation into Innovative Partners, LP, a California-based company, has exposed claims of health coverage fraud, where consumers mistakenly purchased limited or non-existent health coverage plans.
- In a series of significant actions, the California Department of Insurance and Insurance Commissioner Ricardo Lara have taken steps to protect consumers from fraudulent activities within the insurance and finance sectors, including serving Cease and Desist Orders to multiple entities and individuals.
