Category: State Farm

Insurance costs hit home, for all of us – including the good neighbor and LA Insurance Commissioner Donelon, too

“One thing is certain.  The more we all spend on insurance, that’s less money that we spend on other things, like cars, and refrigerators, and clothing.  Until the problem is solved, our recovery will never be complete…”

WLOX reporter Doug Walker hit the road for a week in January to learn more about the insurance situation and found Insurance costs hit home, for all of us.

During my travels, I met a widow whose insurance bill has climbed from $2000 a year in 2004 to more than $7000 now.  Another homeowner was told his insurance was going up from $2400 a year to $6300.  He finally got a policy through an independent broker with Lloyd’s of London for $4000.  The list goes on and on.

Indeed, the list does go on and on and, as Walker points out, insurance cost is not just a Mississippi issue.  State Farm found that out yesterday and Rebecca Mowbray caught the story for the Times Picayune – Insurance Commissioner Jim Donelon rejects 19 percent statewide rate increase request by State Farm.

“This is an out-and-out rejection,” Donelon said. “We’re so far apart, we don’t feel like there’s a reasonable chance for compromise.”

State Farm, which is free to submit a new request, said that it was stunned and disappointed by the rejection…

If the request had been granted, State Farm would have been able to collect an additional $67.6 million from its customers in Louisiana. (emphasis added)

State Farm’s requested increase would have pulled $67,600,000 from Louisiana’s economy.  Calculated for the items listed in Walker’s post,  there would be  2380 fewer new cars purchased or 56,333 new refrigerators sitting in stores – or, worse yet,  the 781,403 school-age Who Dat’s would not be wearing a replica of Drew Brees’ Super Bowl jersey.

Donelon’s rejection is the culmination of a battle that has been brewing over the past year over State Farm’s use of a hurricane computer model that seems to project a need for much higher rates than its competitors. Continue reading “Insurance costs hit home, for all of us – including the good neighbor and LA Insurance Commissioner Donelon, too”

Robohms issue reality check in motions filed today! Robohm v State Farm

The subject policy contains language commonly referred to as the “Anti-Concurrent Causation Provision” or “Weather Conditions” exclusion which State Farm has characterized as preventing any recovery for wind damage when the insured property also sustains damage caused by another weather condition… The Mississippi Supreme Court has rejected the argument that the anti-concurrent clause is not ambiguous or not enforceable. The Mississippi Supreme Court held, in Corban v. United Services Automobile Assn., 20 So.3d at ,-r,-r 32, 40-41, that the anti-concurrent clause was ambiguous and unenforceable to the extent that it purported to exclude any wind loss if it occurred separately from and in any sequence to excluded water loss.

State Farm has already argued this exact issue before the United States District Court for the Southern District of Mississippi in another identical Hurricane Katrina related case this month. (See Memorandum Opinion in Charles Spansel and Janet Spansel v. State Farm Fire and Casualty Company…) In Spansel, the District Court found that “State Farm has not shown it is entitled to summary judgment on this portion (anti-concurrent clause) of the declaratory judgment claim”. In light of this ruling and others like it, the doctrine of collateral estoppels prohibits State Farm from contending here that the contract for insurance is not ambiguous as to any perceived anti-concurrent clause.

Plaintiffs’ Motion for Declaratory Judgment, one of five motions the Robohms filed on the 19th of January, was followed on the docket by State Farm’s Motion for Summary Judgment or in the alternative Partial Summary Judgment and supporting Memorandum:

Plaintiffs’ claim for declaratory judgment fails because…it is at odds with Mississippi Supreme Court precedent establishing that the water damage exclusion in the applicable policy unambiguously excludes damage from storm surge and that the anti-concurrent causation clause excludes damage caused by wind and flood acting concurrently. See Corban v. United Servs. Auto. Ass’n, 20 So. 3d 601,614-15 (Miss. 2009).

Buckle up, folks. We’re going to the other end of the Coast – 423 East Beach Drive, Ocean Springs – and way back to see what this case is about before discussing the other motions filed yesterday.  Continue reading “Robohms issue reality check in motions filed today! Robohm v State Farm”

First came the wind, then the water…a look at the Spansel property

Map showing location of Spansel property

Pre-Katrina view of Spansel property showing addition and improvements made following purchase
Continue reading “First came the wind, then the water…a look at the Spansel property”

What a coincidence – State Farm files for 19% rate increase in Louisiana!

Table created with data from the Daily Comet

After MID awarded State Farm a 19.5% rate increase, the Company decided to forgo the shock ’em  first approach it brought from Florida Mississippi- …and the score in the State Farm game was 45-19.5…– and go with a 19% requested increase in Louisiana.

The Times-Picayune carried the AP story; but, hanging on Editilla’s Ladder was the more detailed story in the Daily Comet.

“State Farm, Louisiana’s largest homeowners insurer, has asked regulators for a 30 percent rate increase for policyholders in Terrebonne and Lafourche parishes.

Coastal parishes would take the brunt of the proposed increases, which average 19.1 percent statewide.

The Louisiana Department of Insurance will consider the request, which could generate $67.6 million, or an average of about $229 per Louisiana policyholder. The company has about 296,000 policyholders in the state…”

This brings us to the part of the story where things start to go fuzzy, shall we say.  Continue reading “What a coincidence – State Farm files for 19% rate increase in Louisiana!”

Scrooges and Stooges – State Farm attorneys pack the sleigh!

More rapid than eagles these coursers they came

Scrooges and Stooges that went straight to work

Filling stockings with motions and giving justice a jerk!

Katrina insurance litigation is beginning to not look at lot like Christmas – even when State Farm slips in a check.  Take Kuehn v State Farm, for example.  Anita Lee reported State Farm pays up, but argues award was in error in Monday’s Sun Herald:

State Farm Fire & Casualty Co. recently paid a couple $179,100.31 for Katrina damage, but their attorney said the check came too late to save Henry and June Kuehn’s Cove Place home.

Attorney Earl Denham said the two-story house further deteriorated as the Kuehns awaited settlement of their insurance claim. The city of Ocean Springs wants the property cleaned up.

U.S. District Judge L.T. Senter Jr. ordered the Katrina payment in August, but State Farm has asked him to reconsider the ruling.

“This amount is tendered without recourse, but with the understanding that this is not an admission of an amount owed,” said a letter sent with the check by State Farm attorney Scot Spragins of Oxford. “Given the circumstances, State Farm has decided to make this tender to eliminate the threatened destruction of the Kuehns’ home.

“State Farm intends to continue to litigate the issue. In the event that we are successful and it is determined that these sums are not owed, then State Farm will not seek reimbursement.”

Denham replied the next day: Continue reading “Scrooges and Stooges – State Farm attorneys pack the sleigh!”

Is Chaney the Grinch who stole insurance industry’s Christmas?

He puzzled and puzzled till his puzzler was sore. Then the Grinch thought of something he hadn’t before! Maybe everyday doesn’t have to be Christmas for insurers who want higher rates for the shore.  Maybe Christmas…perhaps…means zones are no more!

They’re finding out now that no Christmas is coming! They’re just waking up, I know just what they’ll do. Their mouths will hang open a minute or two, then the Whos down in Whoville will all cry, “Boo Hoo.”

“We won’t take zone filings for the time being. I think the larger carriers have abused that privilege. We’re trying to bring some reasonableness to how they handle their rates.” Continue reading “Is Chaney the Grinch who stole insurance industry’s Christmas?”

Home $weet Home for State Farm Florida

Anyone surprised to learn State Farm Florida will be staying in the State?  h/t Chip Merlin’s Property Insurance Coverage Blog for the link to the official press release:
The Florida Office of Insurance Regulation (Office) today announced that Commissioner Kevin McCarty has issued a Consent Order that resolves the pending litigation between State Farm Florida and the Office over State Farm Florida’s plan to leave the property insurance market.  By the terms of the Consent Order, State Farm Florida will remain a significant player in the Florida residential property insurance marketplace.
“This agreement is the product of a long and arduous negotiation process,” remarked Commissioner McCarty. “The final result is beneficial to the people of the State of Florida, and beneficial to the Florida insurance marketplace. The consent order satisfies the Office’s requirements issued in our Order dated Feb. 13, 2009, and allows State Farm Florida to remain a viable insurer in the Florida market.” Continue reading “Home $weet Home for State Farm Florida”

WLOX gives the State Farm rate hike another editorial try. Sponsored by the Mississippi Coast State Farm Agents

Poor ol’ Dave looks like he tires of being Ed Rust’s bottom beetch. If it is possible this WLOX Op-ed is worse than the one they ran back in August.

This post is brought to you by State Farm.

Please note the use of the State Farm logo is consistent with the policy contained in the State Farm media press kit, specifically: Continue reading “WLOX gives the State Farm rate hike another editorial try. Sponsored by the Mississippi Coast State Farm Agents”

The Sun Herald expresses some disappointment at the Commish and his State Farm rate hike.

We weren’t disappointed in Mr Chaney’s latest one bit here at Slabbed mainly because we knew what our favorite captured insurance regulator would be doing with this latest Farm rate up. The comments in yesterday’s story and today’s Op-Ed about Mr Chaney being a puppet for big insurance pretty much sums up local popular opinion:

You tell your boss you want a 45 percent raise, but you are unwilling to do any extra work to get it. Your boss, fearing the loss of your services, manages to scrape up enough money to offer you a 19.5 percent pay increase and begs you to stay. You take the 19.5, but you make it clear that you are “disappointed” and will do less work.

Fantasy?

Not if you are an insurance company doing business in Mississippi.

Beginning in mid-February, State Farm Fire & Casualty Co. has Mississippi Insurance Commissioner Mike Chaney’s permission to raise homeowner insurance rates 19.5 percent in the three Coast counties. State Farm had asked for a 45 percent rate increase and said it was “disappointed” not to get it.

The higher rates will apply only to current policyholders since State Farm is not adding to the more than 20,000 customers it insures against wind damage in Hancock, Harrison or Jackson counties. In fact, State Farm plans to drop wind coverage from 1,800 policies in surge-prone areas. Continue reading “The Sun Herald expresses some disappointment at the Commish and his State Farm rate hike.”

The Scarlet K

…while the stated intent of a “scarlet letter” would be to protect the public, in actual use it has been used as a method to increase the severity of a punishment.

Who wears the Scarlet K of Katrina? According to a Daily Journal story now making the rounds – Two years after indictments, state’s legal community tries to fix Scruggs case damage –  it is the debarred and the Bar:

a stain on the profession…a scar on the Mississippi Bar…a devastating blow

A far more devastating blow, however, is the Bar’s betrayal of the spirit, if not the letter, of the Rules of Professional Conduct that provide a framework for the ethical practice of law – a betrayal that wrongly hung a scarlet K on some and wrongly ignored the conduct of others. Continue reading “The Scarlet K”