A State Farm VP has been dismissed after an undercover video surfaced in which he appeared to discuss the company’s efforts to push for a 22% homeowners insurance rate hike in California. The video, which was released by the conservative O’Keefe Media Group, which has a history of doctoring videos, has fueled further scrutiny of the insurer’s handling of policy cancellations and its standoff with state regulators.
The footage, reportedly filmed without the executive’s knowledge, shows Haden Kirkpatrick, former vice president of innovation and venture capital at State Farm, discussing how the company allegedly uses policy cancellations as leverage to gain approval for rate increases. “We go to the Department of Insurance and say, ‘We’re overexposed here. You have to let us catch up our rating,’” Kirkpatrick said in the video. “And they’ll say, ‘Eh.’ Because the Department of Insurance and the insurance commissioner is an elected position in California. He’ll say, ‘Nah.’ And we’ll say, ‘OK, then we are gonna cancel these policies.’”
While pressure groups have been crying out that the video is a smoking gun, the reality is that it’s logical carriers will cancel policies if they aren’t financially viable.
Kirkpatrick, who joined State Farm in 2021 and had started his insurance career in 2015 with Esurance, told the LA Times that the secret video was filmed during a Tinder date – which he now thinks was a set-up.
Kirkpatrick can also be heard saying that homes should not have been built in Pacific Palisades but that homeowners want to have “natural areas around them for their ego.” He called the area “a f— desert.”
He also said he had instructed State Farm’s HR team to create a year “2040” workforce that is more “Hispanic and Latino,” although he said that was being “biased ... away from my own kind.”
The video has sparked calls for a formal investigation.
While State Farm has condemned his remarks, stating that they do “not reflect our position,” the controversy comes amid ongoing tensions between the insurer and California regulators. In February, State Farm executives met with Insurance Commissioner Ricardo Lara to push for an emergency 22% rate increase, citing significant losses from wildfires. The company claims it has already paid out over $1.75 billion in claims, with total losses expected to reach $7.6 billion.
During that closed-door meeting, State Farm’s chief financial officer, Mark Schwamberger, warned that the company’s ability to continue providing coverage in California was “in jeopardy.” He cautioned that “significant nonrenewals” could follow if the rate hike request was not approved. State Farm had already announced plans to drop 72,000 homeowner policies in the state, and executives indicated that further reductions could be on the table if regulatory relief was not granted.
State Farm is not the only insurer struggling with California’s volatile insurance market. Other major providers, such as Mercury General and Safeco, have been granted smaller rate hikes of 12% and 7.2%, respectively. However, under California’s Proposition 103, any rate increase above 7% can be challenged, triggering public hearings and potential delays.
The California Department of Insurance has resisted approving State Farm’s requested increase, citing concerns over financial transparency. Lara’s office has insisted on further justification, arguing that the company has not provided sufficient data to support its claim that it faces an immediate crisis.
Advocacy group Consumer Watchdog has launched a media offensive, accusing State Farm of deliberately withholding financial information while seeking a “backroom bailout” at the expense of homeowners.
“State Farm is demanding a rate hike while concealing critical financial details,” said William Pletcher, litigation director at Consumer Watchdog. “The company should be subject to both civil and criminal investigations.”
For California homeowners, the ongoing dispute raises pressing concerns. If State Farm follows through on its warnings and cancels more policies, homeowners – particularly in wildfire-prone areas – may struggle to find alternative coverage. The state’s insurer of last resort, the FAIR Plan, is already overwhelmed and has already demanded a $1 billion bail out.
Meanwhile, industry experts warn that California’s restrictive regulatory environment is pushing more insurers out of the market, exacerbating the crisis. State-imposed price controls have made it difficult for insurers to adjust premiums to match growing risks, leading companies to withdraw rather than operate at a loss.
While Lara has pledged to reach a decision on State Farm’s request soon, the broader debate over California’s insurance market remains unresolved. Whether regulators approve the rate hike or not, homeowners are left in a precarious position – facing either rising costs or dwindling coverage options.
