According to a press release issued by State Farm Florida Insurance Company on January 27, 2009, they will be pulling out of Florida as far as property insurance is concerned. At this point in time they are the largest insurer in the state. Keep in mind that these are the folks who say "Like a good neighbor, State Farm is there". Just not in Florida, I guess.
Recently they had asked for a whopping 47.1% premium increase and were turned down by the state regulators. They said that even though there had been no major disasters here for several years, "day-to-day" claims had increased in both number and cost. They also cited insurance reforms implemented two years ago as reducing their revenues.
According to the press release they will still continue to write auto, life, and health insurance.
The state Insurance Commissioner says that regulators have 90 days to approve this move by State Farm and that the company cannot drop customers for at least 180 days after that. Supposedly the plan that State Farm is proposing will assist customers as they search for other sources of coverage. Florida Insurance Comissioner Kevin McCarty said he was not surprised at State Farm's move. Nor am I!
The good news is that several smaller companies are stepping in to fill the gap left by State Farm and other larger companies. As I have said many times before, it pays to shop around. I recently changed policies and now pay $500, or 33% less, for the same coverage. It is a good idea to check with local agents from time-to-time to see if rates are better and if a new company is now writing policies in your area.
I have strong opinions concerning the behavior of many of these large insurers, but will leave it to you to figure out on which side of the fence you fall.
If you would like to read the full text of State Farm's press release you can go to: http://www.statefarm.com/about/part_spos/community/sflocal/florida/discontinue_lines.asp I am not sure how long this link will be in operation.
If you would like to see the history of State Farm's rate increase request with the State of Florida and how the process worked, you can click on the following link: http://www.floir.com/StateFarmDocs.aspx
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