Rebecca Mowbray reports State Farm will raise rates for mom-and-pop landlords, drop their wind coverage in today’s Times Picayune:
State Farm Fire and Casualty Co., the state’s largest residential insurer, is asking for an average 9.9 percent rate increase for homeowners coverage in Louisiana.
The filing with the Department of Insurance comes just over a month after Insurance Commissioner Jim Donelon rejected the company’s request for an average 19.1 percent rate hike. Donelon called that proposal unreasonable and unjustified.
State Farm received an average 8.3 percent increase last year in Louisiana after asking for 13.7 percent.
Although the average rate hike would be 9.9 percent, hurricane-vulnerable coastal areas would bear the brunt. The New Orleans region would see a 17.7 percent increase while rates in the Lake Charles region would go up 22.5 percent, said State Farm spokeswoman Brooke Cluse…
Cluse said the proposed rates are based on future loss projections and not past claims experience. She said that although State Farm believed its earlier rate increase request was justified, the company was trying to work with regulators to “move closer to adequate rates.”
What a game! Just how many coastal policyholder contracts for coverage did State Farm honor following Hurricane Katrina? Very few, according to the evidence of the multi-state scheme provided in the Rigsby qui tam complaint. What a waste of public resources to put an agency through the process of reviewing an inflated request just to make one “closer to adequate” appear a better deal! Continue reading “What a “good neighbor” – State Farm sticks another knife in coastal economy!”