Florida Denies State Farm Hearing on Withdrawal Plan

March 30, 2009

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Florida Insurance Commissioner Kevin McCarty has denied State Farm Florida an administrative hearing on details of the insurer’s plan to withdraw from the state’s homeowners market.

State Farm Florida has balked at requirements McCarty has attached to its withdrawal including one that it let its agents place homeowners policies with other insurance carriers.

The company and McCarty have been at odds over how to handle the more than 1 million Florida property insurance policies State Farm Florida plans to stop writing. The company is not exiting the auto insurance business.

Among other things, State Farm’s plan calls for it to be able to transfer as many as 470,000 policies in the first year to Citizens, something McCarty wants to keep from happening.

In its hearing petition and its withdrawal plan, State Farm Florida has argued that it must withdraw from the market to avoid insolvency by 2011.

In denying the petition for a hearing, McCarty said State Farm Florida failed to explain how the withdrawal plan with the requirements he wants would harm it financially. He claimed that the requirements should actually help State Farm Florida because they accelerate the withdrawal more than the insurer’s original proposal.

McCarty gave State Farm Florida until April 14 to file an amended request for a hearing.

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Latest Comments

  • April 6, 2009 at 12:15 pm
    KentU says:
    This SF mess in Florida has got to have a negative effect on their ability to recruit new agents everywhere in the US. I've been a Farmers agent in the Dallas area for almost... read more
  • April 3, 2009 at 5:11 am
    milo says:
    I am sorry to hear youve been in court however when you signed on with state farm didnt you sign a contract which spelled out the rules? If state farm allows their captive age... read more
  • April 2, 2009 at 11:53 am
    okt0ber says:
    Allstate allows their agents to write through other home insurance companies but only Allstate for auto. I don't see why SF can't do the same. As for SF getting dragging into ... read more
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