McDonald, with 25 years of insurance experience, encountered her first bounced check when awaiting payment from State Farm. The check eventually cleared after a hold by the bank, which was attributed to uncertainty regarding funds availability. State Farm maintained that it possessed adequate funds for meeting commitments. The insurer has paid out $4.2 billion related to wildfire claims, prompting emergency rate increase approvals and policy cancellations. The California Department of Insurance is investigating McDonald's payment delay amid broader issues regarding State Farm's claims handling.
McDonald experienced a 25-year career without a bounced check until one occurred involving a claim payment from State Farm. A bank manager indicated the hold was due to uncertainty over the funds' availability.
State Farm has acknowledged financial strain from wildfire claims, having paid out $4.2 billion on approximately 13,000 claims. This fiscal impact led the company to seek approval for rate increases and to cancel numerous policies.
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