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State Farm Out of Florida

February 13th, 2009 by Mike Vasilinda

State Farm will soon be out of the business of selling homeowners policies in Florida. The state today approved a two year withdrawal by the company, but as Mike Vasilinda tells us, there are conditions and a possible legal battle.

Here it Here:

State Farm has been given the go-ahead to drop more than 700 thousand homeowners policies over the next two years. The plan requires at least 6 months notice. State regulators say they would not be giving the approval if they thought it would be hard for people to find replacement coverage.

I would submit to you that the investors and companies that are looking at this are very anxious to do business with State Farm agents and policy holders, because I think these are some of the better risks in Florida, Insurance Commissioner Kevin McCarty said.

The withdrawal is conditional. Policies must go to private companies, not the state. To make that happen, State Farm must let its agents write homeowners for other companies, something it has been reluctant to do. The company has 21 days to contest the order.

The good news in this order, unless State Farm contests it, is that agents will be able to continue their relationship with their customers.

State Farm said it is studying the order.

It is our sincere hope that we can we can work with the OIR to establish a way for State Farm agents to service policies out of State Farm Florida, State Farm spokesman Michael Grimes said.

The biggest battle may be over lucrative auto policies. State Farm wants to keep the business. State regulators say current law may force them to give it up. And the argument could end in court because the company is transferring policies from one company to another to skate the law.

Posted in Business, Insurance, State News | 1 Comment »

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