CA SF Demands 22% Rate Hike
- Thread starter somarco
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Good News, according to Cal Matters "California's largest insurer should know within a couple of weeks whether it can raise premiums on its nearly 3 million policies in the state after making its case in a face-to-face meeting with Insurance Commissioner Ricardo Lara today."
- this would make the turn around time frame in Mid March. The original request date, according to the SF site is " June 2024".
My math could be fuzzy here - but I believe that that is a Nine Month [potential] Turn Around for an Emergency Request. 9 MONTHS! Source.
This is the largest home insurer in the state and some would say they are on life support.
The really good news is that they talked for "nearly an hour and a half" and members included RL, "State Farm" and of Course "Consumer Watchdog". Additionally according to Newsweek the DOI "also pushed for assurances that State Farm would expand coverage in California if allowed to raise rates."
- this would make the turn around time frame in Mid March. The original request date, according to the SF site is " June 2024".
My math could be fuzzy here - but I believe that that is a Nine Month [potential] Turn Around for an Emergency Request. 9 MONTHS! Source.
This is the largest home insurer in the state and some would say they are on life support.
The really good news is that they talked for "nearly an hour and a half" and members included RL, "State Farm" and of Course "Consumer Watchdog". Additionally according to Newsweek the DOI "also pushed for assurances that State Farm would expand coverage in California if allowed to raise rates."
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If you don't Follow Curtis Goldsborough on linked in you are making a mistake. He brings the CA situation to life in Very Fun ways! I highly recommend it.
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Great Synopsis here from PIAWest
State Farm wants an emergency rate hike that averages 22%. California Insurance Commissioner Ricardo Lara said no. He did, however, say yes to a request by Mercury General for a 12% starting this month, and to Safeco's request for a 7.2% hike.
Upset, State Farm pushed for, and received, a face-to-face meeting with Lara.
Mark Schwamberger — the CFO of State Farm General — told Lara and other leaders in the California Department of Insurance that his company's financial stability has been weakened by the $7.6 billion in claims from the Los Angeles area wildfires. So far, State Farm has paid Los Angeles area victims $1.76 billion.
"The ability, prospectively, to continue to stay behind our policies as we enter fire season, it's in jeopardy, sir," Schwarmberger told Lara. "And it's a very serious situation."
Without that emergency increase approval, Schwarmberger said State Farm will have to limit its exposure to wildfire losses and initiate "significant non-renewals."
Last year State Farm dropped 72,000 policies in California and quit writing homeowners policies in the state. And Schwarmberger said even if the increase is granted, State Farm might not go back to writing homeowners policies in California.
The threat has exasperated Lara. "I want to see some guarantee that they're going to come, that they're going to commit to engage," Lara said. "I didn't get that."
The game of chicken between Lara and State Farm has homeowners in California on edge. If the company cancels more policies, homeowners in high risk areas are going to be in a world of hurt when it comes to finding insurance.
Most will be pushed to the state's insurer of last resort, the FAIR Plan. It's already stressed from the numbers who've been forced there in the last few years.
Lara said he'll get back to State Farm and Schwarmberger, and give them an answer, in a couple of weeks.
Source link: Insurance Business America — [EXTERNAL LINK] - State Farm threatens to drop more policies if California's Lara rejects rate hike
State Farm wants an emergency rate hike that averages 22%. California Insurance Commissioner Ricardo Lara said no. He did, however, say yes to a request by Mercury General for a 12% starting this month, and to Safeco's request for a 7.2% hike.
Upset, State Farm pushed for, and received, a face-to-face meeting with Lara.
Mark Schwamberger — the CFO of State Farm General — told Lara and other leaders in the California Department of Insurance that his company's financial stability has been weakened by the $7.6 billion in claims from the Los Angeles area wildfires. So far, State Farm has paid Los Angeles area victims $1.76 billion.
"The ability, prospectively, to continue to stay behind our policies as we enter fire season, it's in jeopardy, sir," Schwarmberger told Lara. "And it's a very serious situation."
Without that emergency increase approval, Schwarmberger said State Farm will have to limit its exposure to wildfire losses and initiate "significant non-renewals."
Last year State Farm dropped 72,000 policies in California and quit writing homeowners policies in the state. And Schwarmberger said even if the increase is granted, State Farm might not go back to writing homeowners policies in California.
The threat has exasperated Lara. "I want to see some guarantee that they're going to come, that they're going to commit to engage," Lara said. "I didn't get that."
The game of chicken between Lara and State Farm has homeowners in California on edge. If the company cancels more policies, homeowners in high risk areas are going to be in a world of hurt when it comes to finding insurance.
Most will be pushed to the state's insurer of last resort, the FAIR Plan. It's already stressed from the numbers who've been forced there in the last few years.
Lara said he'll get back to State Farm and Schwarmberger, and give them an answer, in a couple of weeks.
Source link: Insurance Business America — [EXTERNAL LINK] - State Farm threatens to drop more policies if California's Lara rejects rate hike
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California's largest property insurer, State Farm General, has warned that it will not resume writing new policies in the state, even if regulators approve its proposed 22% rate increase. The statement, delivered in a letter to Ricardo Lara, the state's insurance commissioner, underscores the growing crisis in California's homeowners insurance market as insurers retreat in response to rising wildfire-related losses and regulatory constraints.
State Farm's position follows months of escalating tensions between the insurer and the California Department of Insurance (CDI). In a recent meeting convened by Lara, company executives, state officials, and consumer advocates discussed the impact of Proposition 103, a 1988 law that limits rate hikes and mandates public hearings for increases above 7%.
State Farm's position follows months of escalating tensions between the insurer and the California Department of Insurance (CDI). In a recent meeting convened by Lara, company executives, state officials, and consumer advocates discussed the impact of Proposition 103, a 1988 law that limits rate hikes and mandates public hearings for increases above 7%.
State Farm tells Lara that it "doesn't make sense" to issue new policies in California
Lara blames Reagan-era regulations as California homeowners get fewer options
www.insurancebusinessmag.com
tikibarrister
Guru
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I think I'm supposed to feel sad for Californians…but I don't.
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Interesting last article.
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