ESG & Investing
Hedge Funds Face California Rebuke Over Role in Wildfire Claims
The California Earthquake Authority has attacked investors as “opportunistic” for buying fire-linked claims from insurers.
Hedge funds are facing pushback in California as their bets tied to insurance claims stemming from the Los Angeles wildfires are attacked as unethical.
The transactions in focus are tied to so-called subrogation claims, which hedge funds, private equity firms and other alternative investment managers have been buying from insurers over the past few months. Subrogation kicks in if a third party such as a utility is suspected of being responsible for losses covered by insurers.