Judge Says Texas Can’t Post Some State Farm Rate Hike Information

April 19, 2010

A judge in Austin has blocked regulators from posting on the Texas Department of Insurance Web site some documents on two rate rate filings by State Farm Insurance Cos. that would increase homeowners insurance premiums for its customers in the state.

District Judge Stephen Yelenosky on April 15 issued a temporary order sought by State Farm, which cited competitive reasons to keep private the information on homeowners rates.

The Dallas Morning News reported that the judge did not rule out changing his mind if Insurance Commissioner Mike Geeslin formally decides that the twin rate filings are “insufficient” without the documents.

According to TDI, State Farm Lloyds on March 2 filed for a for a 4.5 percent increase in its homeowners rates, indicating a May 1 effective date for new business and June 1 for renewals. Previously, State Farm Lloyds on July 15, 2009, had filed for an 8.8 percent homeowners rate hike, with an effective date of Sept. 1.

TDI posted the rate filings and supporting information on its Web site. The department says it excluded portions of the filings deemed confidential by State Farm from the online posting.

The court’s April 15 order will keep that information confidential for now, but links to the rate filings were still available on the Texas Department of Insurance Web site at www.tdi.state.tx.us as of April 19.

State Farm Insurance filed the lawsuit against TDI after the state agency posted the rate hike documents, a move State Farm believes could benefit its rivals in the insurance industry.

TDI, however, has taken the position is that documents associated with a rate filing are public information. TDI spokesman Jerry Hagins told The Dallas Morning News that the decision to post the information was partly the result of increases filed so close together.

The company has been embroiled for years in disputes over its homeowners rates in Texas. In November 2009, TDI ordered State Farm Lloyd’s (SFL) to cut rates by 12 percent and refund a total of $310 million to policyholders after finding that the insurer had overcharged customers beginning in 2003.

State Farm subsequently appealed the order, which halted repayments until the courts resolve the case.

The current lawsuit, filed in March, is part of State Farm’s refusal to enact the rate cut and issue refunds. The company says its rates are fair.

Associated Press stories contributed to this report.

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