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Regulators Say They'll Nix State Farm Bid For Rate Increase
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Published: August 25, 2008
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Florida insurance regulators said late today that they plan to reject State Farm's request to increase home insurance rates an average of 47.1 percent statewide.
State Farm is Florida's second-largest home insurer, with more than 1 million policies.
The insurance giant has nearly 100,000 homeowner policies in Hillsborough and Pinellas counties combined.
For some homeowners, premiums would have increased more the 70 percent under State Farm's proposal.
Florida regulators say they plan to reject the proposal in part because they think the company's reinsurance costs are excessive. State Farm bought $9.2 billion of reinsurance, enough to cover claims resulting from storms expected to happen only once every 250 years.
"State Farm did not provide appropriate support for the rate increase it requested," said Deputy Insurance Commissioner Belinda Miller.
State Farm has 21 days to ask regulators for an administrative hearing on its proposal.
Reporter Russell Ray can be reached at (813) 259-7870 or rray@tampatrib.com.
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