Since January 2025, California officials have received more than 160 complaints from people affected by the Los Angeles-area fires. The complaints describe delays or other problems when trying to get insurance payouts that are meant to help rebuild homes and lives. The volume of feedback signaled to state officials that something was not working smoothly in the flow of funds from insurers to homeowners through mortgage lenders.
On Thursday, October 15, 2026, California officials issued an order directing mortgage lenders—including banks and credit unions—to report on how they have handled the insurance proceeds destined for wildfire survivors. The directive gives lenders exactly two weeks to compile and submit the required information. The order covers lenders that have been handling insurance payments for survivors.
Alongside the reporting order, Governor Gavin Newsom signed a law that requires banks and credit unions to pay homeowners interest on any insurance money they hold. The law is intended to compensate survivors for the time their funds are delayed while sitting in lender accounts. By attaching a financial cost to holding the money, the state hopes to incentivize quicker release of the proceeds to those who need them for reconstruction.
By attaching a financial cost to holding the money, the state hopes to incentivize quicker release of the proceeds to those who need them for reconstruction.
Rohit Chopra highlighted the frustration felt by many who have navigated the claims process only to find the money stuck. He said, “It’s unacceptable that after running through a gauntlet of paperwork to file insurance claims, some wildfire survivors still have not gotten access to the funds they need to rebuild.” The statement underscores the human impact behind the administrative complaints and the regulatory response.
California orders lenders to report on their handling of insurance payouts to LA fire survivors https://t.co/h0KIa8y1ww
With the reporting deadline approaching and the interest‑bearing rule in place, state officials are seeking to tighten oversight of the payout pipeline. The two‑week reports will reveal how lenders have processed the insurance funds so far, while the interest provision adds a tangible consequence for any further delay. Together, these measures aim to move the flow of money from insurers through lenders to homeowners more swiftly, addressing the core issue raised by the over 160 complaints filed since the start of 2025.