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Homeowners Insurers Struggling in Multiple States & Farmers’ Resumption of Business in CA

May 21, 2024 (1 min read)

Homeowners Insurance Industry Turmoil Spreading to Other States

Recent turmoil in the insurance industry related to climate change has largely been concentrated in states like California, Florida and Louisiana. But the problem appears to be spreading to other states, including Arkansas, Ohio and Utah.

Last year insurers in 18 states lost money on homeowners coverage, according to analysis by The New York Times. That number is up 50% from the 12 states where homeowners insurance was unprofitable in 2018 and 125% from the 8 states that fell into that category in 2013. Consequently, insurers are raising premiums, reducing coverage or pulling out of states entirely. (NEW YORK TIMES)

Farmers Resuming Some Lines of Business Insurance in CA

Farmers Insurance said it will resume writing commercial multi-peril policies for several industry sectors in California, including auto service & repair, manufacturing, real estate and wholesale distribution, beginning on Aug. 1.

In a statement the insurer’s president of Business Insurance, Eric Coleman, said: “Farmers has operated in California for nearly a century, and while challenges remain, we are encouraged by the positive changes taking place in the state’s commercial insurance marketplace.”

Those positive changes include increased willingness among state officials to discuss ways of expediting rate filings and allowing insurers to use catastrophe modeling in setting rates.

The news from Farmers comes shortly after it announced it would lift a temporary moratorium on writing new commercial auto insurance policies in California. Last May the company decided to stop writing new property/casualty insurance polices in the state due to inflation and the increased risk of wildfires. (INSURANCE JOURNAL)

—Compiled by SNCJ Managing Editor KOREY CLARK

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