LA wildfire victims sent warning over sneaky insurance company tricks after homes were incinerated

California's insurance commissioner has issued urgent advice to any residents that have lost their homes and businesses in the ongoing fires in Los Angeles. 

Ricardo Lara cautioned those affected not to sign anything from insurance companies immediately, as they may try to settle quickly with low offers. 

Lara said a little patience in these traumatic times could help fire victims receive the full compensation they deserve and also avoid falling victim to scams.

Wildfires in the Southern California region have ravished parts of Los Angeles, including Pacific Palisades where stars including James Woods have lost their homes.

Officials have revealed that at least 2,000 structures have been destroyed so far.  

Lara told ABC7 that residents should first and foremost access safety, keep away from the disaster area and don't rush in to any decisions. 

He reminded residents that they are entitled to a three-day cooling-off period before they need to make any decision with a public adjuster. 

'Often what we've seen, unfortunately, throughout multiple fires in different years throughout the state, is you start seeing out-of-state adjusters come in, trying to, you know, cut a deal with homeowners,' Lara told the programme. 

Lara said that people who have just lost their homes can be vulnerable to fraud during such a stressful moment. 

Pausing before signing any kind of payout deal can help people catch potential fraud before it's too late. 

Lara also recommended double-checking an adjustors' credentials by calling the insurance department and asking for their license. 

He also recommended calling their insurance company before signing anything with an adjuster. 

'We're just asking people to call our department, do not sign anything under duress,' Lara said.

'This is a very traumatic moment... and we want to let them know that please look out for fraud, do not sign anything, and we're here to be able to help them through the entire process.

'It's very important that you know you have somebody on your side,' he told Los Angeles residents. 

Lara advised those affected to keep a copy of their home insurance policy safe as well as make note of any additional living expenses occured since the fire began.

He also advised keeping a note of all contact with the insurance provider and adjuster.  

The California Department of Insurance can be reached at 1-800-927-4357 or insurance.ca.gov. 

California has been in the grip of an insurance crisis as major providers have refused to renew policies or offer new customers coverage as the effects of climate change make extreme weather more frequent in the state making covering losses more difficult. 

The payouts from the fires could cost insurers in the region of $10 billion according to analysts at J.P Morgan. 

'I've been in the insurance business almost 10 years and this is the worst that I've ever seen it,' Nick Ramirez, an agent with Goosehead Insurance, told the Wall Street Journal. 

Insurance officials have said the economic damage, which could be as much as $57 billion according to AccuWeather, could be on par with the fires that ravage Maui in 2023. 

Insurance companies were recently given the green light by the state to hike costs by as much as 40 percent. 

The change came after State Farm gave California an ultimatum - threatening to ax cover if it did not allow the insurer to raise home insurance rates for millions. 

This will be the first time that insurers have been able to pass on the cost to consumers in California, which is a common practice in all other states. 

However consumer advocates warn that this change will likely lead to immediately higher prices for homeowners, many of whom are already struggling to afford soaring premiums.