State Farm says the steep hike on homeowners is necessary to shore up its cash reserves in the event of another catastrophe. The insurer has said it expects to pay out about $7.6 billion in claims related to the Los Angeles wildfires, although reinsurance will lower its losses to about $612 million.

The California Department of Insurance has been under pressure to stabilize the market, introducing new rules that allow insurers to factor in future climate risks when setting ra

On Friday, Insurance Commissioner Ricardo Lara signaled his willingness to allow State Farm to raise homeowner rates by an average of 22%. He also granted the state’s largest insurer initial approval to increase premiums by 15% for renters and condo owners and 33% for rental owners.