Tens of thousands of Florida residents are seeking new insurance coverage after Farmers Insurance announced Tuesday that it would no longer be offering coverage in the state in order to “effectively manage risk exposure.”
“We have advised the Florida Office of Insurance Regulation of our decision to discontinue offering Farmers-branded auto, home and umbrella policies in the state,” Farmers spokesman Trevor Chapman said, according to CBS Miami. “This business decision was necessary to effectively manage risk exposure,” Chapman continued. (RELATED: Insurance Titans Are Suddenly Fleeing California. Here’s Why)
With this decision, Farmers becomes the fourth major insurer to leave the Sunshine State as “extreme weather” poses a looming threat to policy holders, CBS News reported. Homeowners within the state already pay three times the national average for their home insurance, with rates expected to rise about 40 percent this year, the outlet stated.
I’ve always said that when big decisions are made on insurance the policyholder is rarely in the room; unfortunately @WeAreFarmers proved me right. I’ve asked my team to put their heads together in holding Farmers Insurance accountable. I want additional scrutiny on this company. pic.twitter.com/fDgadXndfx
— Jimmy Patronis (@JimmyPatronis) July 12, 2023
Florida Chief Financial Officer Jimmy Patronis blasted the decision by Farmers, promising to “explore every avenue possible for holding them accountable.”
“It’s clear that while Farmers was making plans to exit a significant number of policies out of Florida, they were playing politics, and weren’t focused on running a successful company. I sincerely believe that with today’s actions, Farmers Insurance is well on its way to becoming the Bud Light of insurance,” Patronis stated in a release
Patronis added that he has directed his head of Consumer Services to look into Farmers Insurance complaints and should those complaints reach a certain threshold, “it will trigger market conduct investigation that could lead to fines being levied against the carrier.”
“It is our expectation that if Farmers cancels any policies, all prorated amounts must be returned to policyholders and we are currently working with the Florida Association of Insurance Agents to explore methods for a bulk transfer of policies,” Patronis stated.
Farmers has indicated its decision will impact only company-branded policies and will not affect policies sold under subsidiaries Foremost and Bristol West. The company said branded policies make up about 30 percent of its policies sold in Florida, CBS News reported. Though it is not immediately clear how many people will be affected by the decision, a source estimates 100,000 residents will need to seek new coverage, CBS Miami reported.