MIAMI.– The battered insurance network for homes and other properties in Florida receives another blow: the insurer Farmers Insurance announced that it is withdrawing from the state and leaving thousands of policies, including homes, businesses and vehicles, in the middle of the hurricane season.
The company assured that the measure will affect “only” Farmers-branded policies and not those that were granted through the Foremost and Bristol West subsidiaries.
“We have informed the Florida Office of Insurance Regulation of our decision to stop offering Farmers-brand auto, home and general policies in the state,” the statement issued by the insurer said.
In fact, this is the seventh insurer to withdraw from Florida, after Southern Fidelity Insurance Co., Weston Property and Casualty Insurance Co., Lighthouse Property Insurance Corp., Avatar Property & Casualty Insurance Co., St. Johns Insurance Co. and FedNat Insurance Co. did the same last year.
“This business decision was necessary to effectively manage risk exposure. Farmers offers insurance through several different brands, and this decision applies only to policies issued through our exclusive agency distribution channel,” he said.
However, the director of Finance of Florida, Jimmy Patronis, assured that Farmers “will be held accountable.”
“I have called for Farmers Insurance to be held accountable to Florida policyholders. I want additional scrutiny on this company. Therefore, I have directed that Farmers Insurance complaints be pursued further, and if those complaints reach a certain threshold, a marketplace conduct investigation will be launched which could result in fines being imposed on the insurer,” he anticipated.
It was not immediately clear what impact Farmers’ move would have on Florida’s troubled homeowners insurance market, where insurers have dropped hundreds of thousands of policies and increased rates in recent years.
However, state law requires a 90-day notice before you can tell customers that policies will not be renewed.
In accordance with the medium The News Service of Florida Around 100,000 Farmers policies could be affected, including homes, businesses, automobiles and other matters.
A state report indicated that, as of December 31, Farmers Casualty Insurance Co. had 5,835 homeowners policies.
Background
Florida’s home insurance market has seen multiple problems in recent years, from insurers with alleged financial problems and rate increases to thousands of homeowners having to find someone to insure their properties against hurricanes.
Actually, this situation started 30 years ago. Two months before Hurricane Andrew hit, on August 24, 1992, the premium payable for $100,000 of coverage was barely over $800.
Since then, the price to pay has risen more than 500%, from $820 a year to $5,000 and with fewer benefits.
Last year, Governor Ron DeSantis convened two special legislative sessions to address the state’s battered insurance network, and among the few rules that were adopted, he noted adding $1 billion to the reinsurance fund, which supposedly could reduce insurance costs. the disputes.
This adopted rule obliges Citizens clients to have additional coverage for floods and even to leave the state insurer if they receive an offer whose price does not exceed 20% of what they pay.
Ultimately, when a hurricane hits and insurers can’t afford to pay, both the state and federal governments will have to dig out their checkbooks and shell out billions to repair damages for victims.
2023-07-12 14:02:52
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