A Pacific Palisades couple is seeking a court order that would force California’s insurer of last resort to turn over claims documents following allegations it has delayed payments to fix their fire-damaged home.
The lawsuit by Scott and Lissette Jungwirth accuses the California FAIR Plan Assn. of bad faith, breach of contract and other wrongdoing in seeking a temporary restraining order and injunction to obtain photographs taken by their field adjuster, as well as the adjuster’s narrative reports and communications with the plan.
The Los Angeles County Superior Court lawsuit said the home remains standing but was infiltrated by soot, ash and fire debris carried inside through a broken window. Testing done by a professional hygienist allegedly found heavy metals, lead, cyanide and other contaminants, which would require demolition, removal of dry wall and flooring, and other repairs.
That has forced the couple and their young daughter to live in hotels, with friends and relatives and in Airbnbs, yet the plan has failed to restore the home — and turn over the documents so they can better understand the delay, according to the lawsuit.
A spokesperson for the FAIR Plan said it does not respond to pending lawsuits.
The litigation was filed by the same two law firms — Edelson and Kerley Schaffer — that handled a lawsuit brought by 10 FAIR Plan policyholders last month that accused the insurer of bad faith and breach of contract because of the plan’s alleged refusal to properly investigate and pay for the cleanups of homes damaged by wildfire smoke.
The FAIR Plan maintains it covers smoke damage claims as required by law and pays for independent industrial hygienists as needed to properly assess what level of remediation a home requires.
Monday’s litigation similarly names as defendants the state’s biggest home insurers, including State Farm General. The Los Angeles-based FAIR Plan is operated by California’s licensed home insurers who govern it and share in the plan’s profits, expenses and losses based on their weighted market share.
State Farm General did not immediately respond to a request for comment.
Dylan Schaffer, one of Jungwirth’s attorneys, alleged the plan does not turn over adjuster documents because it would show homes are more badly damaged and in need of more remediation than the plan is willing to pay for.
“A lot of these adjusters are telling California FAIR Plan the truth: These houses are really badly damaged,” he said. “They need all kinds of work. And California FAIR Plan takes those and they slash them.”
The lawsuit contends the plan has for years refused to turn over claims-related documents, despite 2001 legislation arising out of the 1994 Northridge earthquake that amended the insurance code and granted consumers the right to such documents.
It also cites a Jan. 6 decision in Fresno County Superior Court that granted a FAIR Plan policyholder who suffered wind damage in 2022 access to her claims documents. Schaffer, who also handled that case, said it involves the same issues encountered by the Jungwirths.
The request for an injunction was the second lawsuit filed by a Jan. 7 fire victim against the FAIR Plan in the last two weeks. Luis Cazares, an Altadena homeowner, sued the plan on May 2, alleging bad faith and breach of contract.
He alleges his home was made uninhabitable by fire and smoke damage, yet the plan only paid him $55,850, which is inadequate to repair it. The lawsuit notes that levels of lead in residual ash in Altadena exceed the amount deemed safe, according to a study done by the Jet Propulsion Laboratory and Caltech.
The case was brought by Bradley/Grombacher, a Westlake Village firm, and Aylstock, Witkin, Kreis & Overholtz, a personal injury and product liability firm in Pensacola, Fla., that has handled mass tort cases and represented homeowners suing insurers over hurricane claims.
“I want to get him full relief so he can rebuild his life,” attorney Bryan Aylstock said. “He paid the premiums. He deserves that, and it’s a shame that so far he hasn’t gotten it.”
The attorneys said they intend to file additional such cases. Last week, they also filed a lawsuit against Southern California Edison that claims the utility was negligent in maintaining its infrastructure, triggering the Eaton fire and exposing people nearby to the fallout of lead, asbestos and other toxic substances.
Edison officials have acknowledged that their equipment may have ignited the devastating fire, but have cautioned that the cause remains under investigation.
The FAIR Plan also is the subject of twin lawsuits arising out of the Jan. 7 fires filed by property owners against the top property and casualty insurance groups in the state.
The litigation filed last month accuses the insurers of colluding to drop homeowners and force them into the plan, where they paid higher premiums but received less coverage, thereby reducing the insurer’s liability — an effort that significantly benefited them after the catastrophic Jan. 7 fires, since they backstop plan losses.
The FAIR Plan was not named as a defendant, but an insurance industry trade group said the lawsuits “defy logic, advance meritless claims, and we are going to focus on solving the challenges in the insurance market in California.”
