State Farm (wants) to stop insuring Florida Homes

Discussion in 'Off Topic' started by tom_in_orl, Jan 27, 2009.

  1. tom_in_orl

    tom_in_orl Founder of Microskiff, Member of the Gheenoe Army

    fuck

    http://money.cnn.com/2009/01/27/news/companies/florida_insurance/?postversion=2009012716

    State Farm to stop insuring Florida

    State Farm Florida says it will no longer renew policies for 1.2 million customers after regulators denied requests for a 47% rate hike in the hurricane-prone state.
    Last Updated: January 27, 2009: 4:17 PM ET

    MIAMI, Florida (CNN) -- Florida's largest private insurer is pulling the plug on homeowners' policies in the state, citing the losses suffered since the brutal 2004 hurricane season.

    The decision by State Farm Florida comes two weeks after state insurance regulators rejected the company's request to raise rates by more than 47%. The decision means State Farm Florida - a subsidiary of national insurance giant State Farm Mutual - will no longer renew policies for its roughly 1.2 million customers in the Sunshine State.

    "This is not an action we wanted to take, but one we must take given the realities of the Florida property insurance market," company President Jim Thompson said in a statement announcing the decision.

    The company said it has paid out $1.21 in claims for every dollar of premiums it has collected since 2000 and suffered billions in losses after the 2004 hurricane season, when four major storms hit the state. And it said its net worth had dropped by nearly 25% since 2006 even with no major disasters.

    "This is not something any business can afford to do," Thompson said.
    Step requires state approval

    Company spokeswoman Michal Connolly said the announcement is the first step in a two-year process that will require the approval of state regulators.

    In a statement issued after the decision, Florida Insurance Commissioner Kevin McCarty said the company had warned that a withdrawal from the homeowners' market was possible when it was seeking a rate increase. He said his office had 90 days to approve the company's plans.

    "I will do everything within my power to protect Florida consumers from unnecessary destabilization of the insurance market that this might cause and to ensure that Florida consumers are protected and have access to insurance at rates that are not excessive or unfairly discriminatory," McCarty said.

    State Farm Florida was set up as a separate entity in 1998 to address what the company called the "unique risks" of doing business in Florida. It said it had to borrow $750 million from its parent company after 2004, and has been unable to pay that money back.
     
  2. beavis

    beavis Well-Known Member

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    Myself and several other people I know have already been dropped. Good Ridddance
     

  3. aaronshore

    aaronshore Well-Known Member

    That sucks. Looks like I gotta start shopping.
     
  4. Brett

    Brett > PRO STAFF <

    What would you do, in a state where the building industry
    fights establishing building codes that can make homes
    hurricane resistant. A roof made out of 7/16 inch thick plywood,
    does not qualify as hurricane resistant. Windows held in place by
    4 screws and some caulk, don't think so. Building homes in what
    were once lakebeds, and then act surprised when they flood, come on.
    A 'cane resistant home can be built at a profit, but, not as big a profit.
    Then there's the fact that a 'cane resistant home lasts longer.
    No rebuilding profit there. Agreed that State Farm split it's company
    to keep maximum profitability everywhere else, and to be able to
    charge more here. Instead of balancing it's risks over a larger
    client base. As a complete business State Farm makes a big profit.
    As a subsidiary, the Florida entity is bleeding money. They are cutting
    the non-profitable portion of the business. The insurance industry lobbied
    for stronger building codes for years, but the builders cried that the costs
    would make homes too expensive to purchase. I'm not happy about
    State Farm leaving, I've been a client for over 25 years.
    There's no such thing as fair, I get what I get, I deal with it.
     
  5. Un-shore

    Un-shore Well-Known Member

    What they did is scooped up everybody that got dropped a couple of years ago and are taking the money and running.

    I got dropped by my insurance company after wilma and got picked up by citizens. I asked around about finding better coverage and everyone I talked to said that state farm was about the only ones writing policies. Glad I stayed where I'm at.
     
  6. Flyline

    Flyline Won &quot;Do More With Less&quot; Award!

    We already notified in the mail about homes and the insurance company don't cover boats anymore! I have to use different insurance company to cover my boats. What a PIA
     
  7. B.Lee

    B.Lee Well-Known Member

    Progressive is still here, insuring boats, let 'em make tracks! he he he
     
  8. Kemo

    Kemo The world is flat....and shallow.

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    Citizens tried to get a hefty increase last year but the Governor said no. So, they are not renewing my policy. Instead, I will have to re-apply. I won't be turned down, but do you think my new policy will have the same rate as the current one? Nah, I didn't think so.

    Kemo :mad:
     
  9. brew1891

    brew1891 Well-Known Member

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    Liberty Mutual [smiley=thumbup.gif]

    My parents have been die hard State Farm people since 1970. When I bought my house I thought their rates and coverage were horrible so I went with Liberty Mutual for house and then my cars. Have been much happier paying less for more coverage! Looks like I made the right decision not to go with State Farm.

    Also there is a fellow forum member working for Allstate. I got him to insure my boat. Rates were great and coverage was much better than Progressive. The exclusions on Progressive were pretty scary.
     
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