Thursday, January 29, 2009

Like A Bad Neighbor State Farm Is Not There

Earlier this month, Insurance Commissioner Kevin McCarty rejected State Farm Florida's request to raise homeowners insurance 47.1 percent. State Farm Fl decided to drop all Florida property insurance policies. It will take State Farm two years to end all policies. The Office of Insurance Regulation has 90 days to approve the plan.

Florida leaders have reacted angrily to State Farm's announcement. McCarthy subpoenaed State Farm. The subpoena is a fishing expedition into any manner of State Fam documents. State Farm is certain to fight the subpoena.

Gov. Charlie Crist maintains his my-way-or-the-highway stance.

"They probably charge the highest rates in the state anyway," Crist said. "Floridians will be much better off without them." The problem with Crist's statement is he doesn't have a back up plan. Citizens Property Insurance has $3.6 billion on-hand. The Cat fund: $2.8 billion. Sen. Mike Fasano, R-New Port Richey, wants to stop State Farm from leaving. Florida House Speaker Ray Sansom is convening a meeting State Farm representatives. My fear is Crist does nothing.

State Farm Fl is the largest property insurance insurer in the state. Citizens Property Insurance can not absorb those policies. Either Crist courts private insurers into Florida or he gives in.

Update: Fasano is sponsoring legislation prohibiting State Farm from selling auto insurance, if State Farm no longer seels property insurance. Crist has voiced his approval of the pending bill. I am no fan of State Farm, but what happened to Republicans' Laissez-faire economic principles?

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