In this article, we investigate the link between closure phase and the observed systematic bias in deformation modeling with multi-looked SAR interferometry. Multi-looking or spatial averaging is commonly used to reduce stochastic noise over a neighborhood of distributed scatterers in InSAR measurements. However, multi-looking may break consistency among a triplet of interferometric phases formed from three acquisitions leading to a residual phase error called closure phase. Understanding the cause of closure phase in multi-looked InSAR measurements and the impact of closure phase errors on the performance of InSAR time-series algorithms is crucial for quantifying the uncertainty of ground displacement time-series derived from InSAR measurements. We develop a model that consistently explains both closure phase and systematic bias in multi-looked interferometric measurements. We show that non-zero closure phase can be an indicator of temporally inconsistent physical processes that alter both phase and amplitude of interferometric measurements. We propose a method to estimate the systematic bias in the InSAR time-series with generalized closure phase measurements. We validate our model with a case study in Barstow-Bristol trough, California. We find systematic differences on the order of cm/year between InSAR time-series results using subsets of varying maximum temporal baseline. We show that these biases can be identified and accounted for.