President
Senate
House
Governor
President
Senate
House
Governor

State Farm Skedaddling Out of California's Insurance Market

This week, with little forewarning, more than 70,000 State Farm policyholders in California were unceremoniously informed that their insurance policies would not be renewed.

Advertisement

Via a thin boilerplate letter, the state’s largest insurer gave little in the way of details to some 30,000 residential customers and 42,000 commercial apartment policyholders. But the announcement was met with shock and dismay by industry observers and customers.

“It’s confounding, it’s frustrating and it feels really outrageous, honestly,” said Amy Bach, the executive director of United Policyholders, a San Francisco-based nonprofit that advocates for insurance consumers.  “We’re in a place where, unfortunately, consumers don’t have other options, and what it feels like is they are ratcheting up the pressure.”

The timing of the announcement—an escalation from the company’s decision last May to cease writing new policies for customers in California—is particularly striking. It comes the week after State Farm raised home insurance rates for its customers by 20% and after California Insurance Commissioner Ricardo Lara introduced new policies around “catastrophic modeling” the industry has long clamored for. 

Join the conversation as a VIP Member

Trending on HotAir Videos

Advertisement
Advertisement
Advertisement