State Farm plans to defend proposed rate boost at hearing

Oct 23, 2008

South Florida Sun-Sentinel–October 23, 2008

State Farm is set to defend its proposed 47 percent average statewide property insurance rate boost at a hearing in Tallahassee on Monday.

The insurer asked to make its case before the Division of Administration Hearings after Florida Insurance Commissioner Kevin McCarty said he planned to reject the increase. The premium increase would have been as high as 112 percent in parts of Broward County.

State Farm, Florida’s largest private insurer of homes, said it needs the rate hike to grow its claims-paying reserves. It said expenses are increasing and premiums are dropping, largely due to discounts for homes that are upgraded to be more hurricane-resistant.

Florida Office of Insurance Regulation officials have asked State Farm why its expenses are increasing even as the insurer continues dropping policies in Florida.