OK Rater – I was thinking about your comment all day – “Once a storm hits there will be an emergency rule to stop all canx. and non-renewals and SF will still be here with policies 3 years from now. Mark it down.” – and I probably won’t sleep too well tonite. If what you predict comes to pass – I’m wondering if we should all surrender now. The key is under the front door mat Charlie.
If I were SF, I’d tell McCarty enough of his BS. Instead of the prior plan, we plan to completely pull out of FL so these start up companies can not only have the property business but the auto, life, etc. And instead of the prior 2 year plan, we will start issuance of non renewals immediately (or whatever is allowed by law/policy conditions). With each non renewal would be a letter of apology to the insured, explaining that due to the current political environment with the Gov and the Ins Dept and Sink, SF is unable to write insurance in the state and make a profit.
If I remember correctly, I think OIR/Gov are pissed at Allstate and probably other national carriers, and if something isn’t done about the insurance crisis in that state soon, it will be only Citizens and the new start-up to write business there. 1st big blow that comes through, and FL is the 1st state in the nation to file for bankruptcy, with each property owner being hit with huge assessments for the next 10 years.
So are non-SF agents being told not to place business into CPIC as well?
Why doesn’t the State of FL make an offer on the whole SF book and the agency contracts/infrastructure? Why would they pass up the investment opportunity on what they have convinced the voting public is such a money machine? Give the people what they want.
Who needs a lottery to generate revenue, this is a goldmine.
Let’s make it interesting. Let’s call on the Gov, the Commish, and all the State Fund and CPIC execs to pledge a 10% salary garnishment and a prohibition from seeking election to any federal/state/local position commencing the day the next assessment is added to cover hurricane losses, and lasting as long as the assessment does.
Just asking for a small personal gesture to demonstrate their confidence in the strategic plan they’ve laid out for their constituents (and their grandchildren).
These strategies are based on sound financial analyses aren’t they? They encourage all their family and friends to use CPIC and the new companies – don’t they? It’s those evil national insurance companies that are lying to us – right?
One of the most important functions of the OIR is to protect the citizens against placing business with insolvent carriers and making sure they have the resources to pay claims in the event of a catastrophe. Ask yourself this question, Has the OIR done its job of protecting consumers against insolvency of these startup carriers?
I can’t believe I have gained a smidgeon of respect for McCarthy calling State Farms bluff. Let the SF agents roll the business into a another company, rather than losing the business. The solvency issue is another matter, but that would be there no matter which way the polices go. It is still a wreck waiting to happen.
Do you think that the public will have the same respect for Crist and McCarty when their carrier of 25 years cancels them and their State Farm agent does not know how to rate them with the new carrier who has no money.
I would hate to be a State Farm agent now!
I never thought I would say this but I am actually sorry for them.
customer owned company what to sell, who to sell it to, and what price to sell it at? What do you call it when the government requires you to sell your service at a loss? Where the hell is the ACLU? Where the hell is the attorney general? Where the hell is the Better Business Bureau?
I say we all call our House Reps and urge the federal government to intervene. Or we could form a militia and force Florida to secede. It’s federal taxpayers who will end up bailing out the Fl crybabies when the whole thing goes bust. Why should we respect state sovereignty while holes are being dug and then “come together as a nation” when the hole needs to be filled?
As stated elsewhere, the OIC has a duty to protect the consumer from underfunded insurers who cannot pay their claims. Who is verifying the solvency of ALL FLORIDA INSURERS?
Do they really want to run off the biggest and maybe the only insurer in the state who could actually pay their own claims? Again, which company does the heavy lifting regarding the guaranty fund
I don’t feel sorry for them. The ones I know have always bad mouthed other carriers and agents and done other things that I do not wish to mention in a public setting that at least were unethical and at worst worthy of license suspension. Nope- those SF agents have been on the “gravy train” long enough- they can do like I did and go out and start an independent agency on their own dime. McCarty wants SF to pay for their agents to go independent- he is a real piece of work.
It was funny seeing Crist and Obama together the other day. Is Charlie a real fiscal conservative. I wouldnt even call him a moderate. He is a democrat!!!
I think we have found a new Commerce Secretary who has no fundamental differences with the president!!!
SF has operated the last several years in Florida as a separate entity at least on the property side. SF of Florida is no more solvent than your basic Florida domestic company who was started 2 years ago. This is a mis-perception that is promulgated by the non-insurance professionals at OIR. As stated in the SF filing to withdraw from the state- even without another hurricane or other catastrophic event- they will become insolvent by Dec 2010.
Everyone should email Crist’s office and demand that he form a committee on how to attract new carriers to the state to write homeowners insurance. Louisiana, Hawaii, California and other catastrophic prone areas do not have the same problems we do. WE NEED SOLUTIONS NOW! NOT AFTER A STORM!
Do you really think the State OIR or the courts would allow Mother SF Boomfield Ill. to abandon their baby in time of need. I don’t think so. I know that SF and all other carriers have tried to insulate themselves from the inevitable assements after a storm, but I do not believe the courts or congress to allow them to do so at the expense of tax payers.
Cotyre wrote – ‘SF of Florida is no more solvent than your basic Florida domestic company who was started 2 years ago.’
If that were true, how do you explain the $750 Million shot in the arm SF Mutual provided SF Florida in order to pay claims? Are you telling me that the now famous 2 year Florida startups have that kind of backing? From whom? And what about that $750 million subsidy by SF policyholders from other states to SF Florida that will now never be rightfully repaid? Here’s an idea – let’s require Floridians to subsidize claims from the California wildfires. How about the Kentucky ice storms. Lets throw in Washington flooding.
We all agree that SF Florida cannot take another hit and pay claims. So tell me again, what is the problem with SF Florida charging an amount that results in rate adequacy?
Newsflash – SF agents don’t want to represent some turd startup. They know that one day they’ll be called upon to ACTUALLY PAY THE CLAIMS.
So Bill thinks that charging an amount for insurance that allows the carrier to remain solvent comes at the expense of the taxpayers? Hey Bill – your a few months ahead of yourself. I don’t think we will sink into complete socialism until mid May. Then the taxpayers will carry 100% of the load.
I thought the Gov. was glad to see SF leaving b/c we have CPIC. Guess he was lying yet again. Why do all these Natl. co’s want to leave Fl? Two reasons: (1) the Gov and (2) the OIR. They set rates and deny they do. Once a storm hits there will be an emergency rule to stop all canx. and non-renewals and SF will still be here with policies 3 years from now. Mark it down.
Excuse me? SF of Florida would not have paid a dime for hurricane loss in 2008 unless damages exceed it’s reinsurance amount. Which by the way, last year they over-insured by 200%. Payments going to mother State Farm.
By the way, there are insurance companies in Florida that have been in business since Andrew… And only now I’m finding out with cheaper rates than SF of Florida.
SF can kiss my butt… I’m dropping my home, 3 cars, RV, boat and life insurance as soon as my quotes come back from 4 agents. I really don’t care if I have to pay the same or a little more.
read the filing of withdrawal. SF Florida is still indebted the SF mothership. What was the reason that SF, Allstate and Nationwided set up separate subsidiaries in Florida? I can only think of 1 reason.
All we in Florida have to do is look to Louisiana and see how they have handled things since Katrina. By comparison in Florida- instead of doing the people’s business in an ethical, democratic fashion-our politicians have to artificially suppress rates for the exposure to get votes and cater to the AARP crowd. This state is a cesspool of exceeded authority by all government officials from the state down to the city and county. The solution to Florida’s property insurance crisis is simple- tell the OIR to regulate and not dictate and beg companies to come into the state- let them charge what they consider as actuarially sound rates and let the competition begin.
who knows what the courts will allow. That is a whole another problem. But I will tell you this- the separate entities were setup to capitalize on FIGA and Hurricane Catastrophe Fund. Why should SF, Allstate or any other national carriers subject their companies to catastrophic losses and/or insolvency when the Florida OIR will allow companies to start writing property insurance provided they can come up with $10,000,000. Under capitalized companies receiving the Florida OIR stamp of approval for financial stability and solvency. Its a joke.
Sorry, Someone. You are forbidden from canceling SF. You will be forced to buy SF. What goes along with forcing SF to take you is that Florida will force you to take them. At whatever rate Florida decides, good or bad.
I coined a phrase a long time ago – what’s good for the hen is good for the rooster, or something like that.
It’s too bad you can’t cancel State Farm.
If you could it would be one less out of stater that I have to pay for.
The little guys who do not rely heavily on the Cat fund for reinsurance are at least as solvent as State Farm Florida who is bleeding money because of this huge loan from prior hurricanes along with extreme reinsurance costs from the parent company.
I try to keep a neutral opinion in these situations. I hate it that State Farm wasn’t granted their rate increase because the free market should dictate rates, not politicians.
you are absolutely correct Mr. Solvent. Guess the taxpayers and residents of this state will only find out who the real culprit is when the next CAT 3-5 storm hits and the state has to beg the Feds for a bailout.
Many of you might not know this but, back in November 2008 State Farm had Charlie Crist sign a law allowing SF to give a 17% discount on their auto insurance if the policy owner bought a CIPIC policy thru a SF agent. I know this because I worked for an agent until recently. SF claim is that other auto carriers offer discounts for “HOME OWNERS” but the other auto insurers don’t require that your client have a homeowners policy with you.
So what was SF game plan? Pull out of Fl.homeowners but keep auto their biggest profit maker. They know that when a client calls us the indepents for a quote on older properties there are very few Private insurance companies underwriting those policies and you will end up offering a CIPIC policy. When the customer calls his SF agent with a comparison the agent is going to tell them they can get 17% discount on their auto if they keep everything with SF! How can we compete!!! And I started my own independent agency 2 months ago and I called all these new start up insurers that are happy to appoint SF agents but, I only get a response that they are not taking new appointments at this time from the independents!! All this time we the independents are the ones that have been the marketing back bone or those Private insurers and SF was the compittion and they now want to embrace SF agents as the protical son. I can’t beleive it!!
this is exactly my complaint. SF agents have for years had advantages over us independents- bad mouthed the admitted carriers we have- marketed their product as the most financially stable due to company rating(SF Florida was demotch rated not Am Best rated). The only advantage we have had- is we were more flexible, able to insure just about any risk and now the OIR is mandating that SF allow their agents to act as an independent and these companies we have will jump in with SF agents with both feet- they will eat up our capacity, they will be allowed to roll over their clients to these companies even if they do not regularly fit their guidelines. It is sickening. The only thing I can do is to drop any and all companies who get in bed with SF and move all that business to those who don’t. OIR and Crist are worried about 826 SF agents statewide losing their jobs. Let the SF agents do what you and I did- foot the bill to start their own independent agency instead and let them competition begin.
Your observations about Charlie and Kevin are true- Charlie will be moving on soon to Congress or US Senate and Kevin will get hung out to dry by the next Governor. As far as the little domestics- most won’t survive a major storm, but that is no different from State Farm Florida. Heck- they are going insolvent by Dec 2010 even without another storm. And I know many of you believe that the parent company Big SF would have rescued them- but that is not true. Why else did they bother to set up a subsidiary for Florida only? Come on I am not that gullible.
Your observations about Charlie and Kevin are true- Charlie will be moving on soon to Congress or US Senate and Kevin will get hung out to dry by the next Governor. As far as the little domestics- most won’t survive a major storm, but that is no different from State Farm Florida. Heck- they are going insolvent by Dec 2010 even without another storm. And I know many of you believe that the parent company Big SF would have rescued them- but that is not true. Why else did they bother to set up a subsidiary for Florida only? Come on I am not that gullible.
So, if private insurers will only take “up to” 500k policies…what happens to the rest? I know…they go to Citizens so we can subsidize them. The state is so blinded by the price of a policy, that they ignore the fact that the coverages are offered by these little companies are worse, service is worse, and if there is ever a hurricane, all of these little new companies will close shop and leave us all waiting on the phone for hours trying to find someone at the state that will listen to us cry and explain to us how busy they are and that we won’t get our claims paid for the next year…leaving us without loss of use coverage etc. Chuck and Larry (oops…honest mistake), I mean Chuck and Kevin better hope they get out of state politics before there is a storm and these chickens come home to roost!
Don’t be fooled by the AM Best rating. State Farm Florida buys its reinsurance from State Farm Mutual. State Farm Florida has not added to the potential burden that the State of Florida has placed on Florida property owners from Citizens and other small, undercapitalized companies. That is where your assessments have come from and will in spades in the future. Remember none of the assessments we are now paying on our homeowners, auto, etc policies has been caused by State Farm Florida. Why would we want to force a long term solid property protector out of Florida and force folks to buy from a much less secure protector with the liklihood of another Poe, or Poes, occurring. WE are Citizen’s reinsurer——up to $16 Billion or more none of which has been contemplated to be caused by State Farm but will have to be borne by the residents of Florida.
There is no logic, Yes they are all going to be insolvent, and logic says you must increase your premiums to deal with the situation at hand. What is more logic is to come up with a solution. Hawaii plan is the only one I have seen that somewhat works in a cat prone area. An actuarial correct windstorm policy everyone in the state pays for in addition to your HO3 policy, like we currently are doing with Flood. And yes, I know what the combined ratio for the national flood program is, but it would be a start and would allow for competition to return on the HO3 that we currently do not have.
I am ok if the state wants to commit financial suicide, Just write the policies and hope they are able to pay after the storm. Then wow! the premiums will shoot through the roof once the state is bankrupt and they need carriers at any cost. We will be writing HO3’s through Scotsdale and lloyds at $8000. for a 200K home. We better find a solution now or this is what is going to happen to the consumers in florida. But hey I am ok with it if the Governor is!
I am happy to inform you that we have found a republican who will go along with my socialist agenda and will not feel any remorse for sticking it to the tax payers of our great new socialist society.
National carriers set up subsidiaries in Flordia because they are required by Florida law to do so. Don’t blame SF for SF Florida. Every non-domestic carrier is required to set up a domestic carrier in the state and actually have a “home office” in the state. Another goober law – which has been on the books for at least 30 years.
nobody important, my take on this is that SF wants to pull out of Florida because they say they are loosing money daily and that if they don’t increase their rates that they will be insolvent in 2 years without any storms? This sounds to me that they may have to much internal costs that are putting them out of business. You do know that SF hasn’t written any new homeowners business in South Florida since 1996. I’m no genious but if your salaries keep going up at the home offices and your not bringing in new customers your going to have some problems with cash flow sooner or later. SF just wants everything placed on a silver platter. I say again, that McCarthy and Sink should tell SF that if they threaten to leave the Homeowners hanging they should also stop selling Auto insurance and leave the State.
What do you care if their internal cost’s are high? That’s SF’s business not yours. If Florida had a FREE MARKET, competition would take care of that. Politicians understand this, but explaining that will not get them votes. Remember the most important thing to a politician is keeping his job/power. These guys are ego maniacs. Term limits would correct this problem, but politicians always find a way to kill that movement.
Again NU, why? If the property rates were too high people would use another carrier. If the property rate the state allows isn’t enough to make a profit why should SF stay? And, why shouldn’t they be allowed to sell other products? Does your local store have to carry some products at a loss to be allowed to sell others? I wish you would apply just a little logic to your position.
Can you give me the Florida Statute number? There is no law that a carrier be domiciled in the State of Florida. Most companies did do so because they are affraid of what will happen after a storm. They will be required to purchase unsold bonds to pay the claims of FIGA and the Cat fund etc. Most are anticipating filing for chapter 11 in the event of a state bankrupcy instead of paying for the states irresponsibility.
I am amazed that the State of Florida is telling SF what they have to do to run their business. The State unilaterally doubled the wind mitigation credits after SF was instrumental in helping develop the Wind Mitigation Credit program. Then refused to approve a rate increase which was necessitated by the unexpected premium credits. Ins. Commish/Crist now say FL will be better off w/o SF because they have all these little companies that are just dying to write homeowners policies in FL. If there are so many companies eager to give State Farm competition why refuse the rate increase. If State Farm rates are too high clients will go the many, many little companies that desperately want to write these SF policies. Let the market solve the situation and do not put the property/business owners of FL on the hook more than they already are now. State Farm can buffer the State from the bankruptcies of these smaller companies when a major storm hits our State.
Mike, your logic makes sense and should be the way this should play out but the OIR doesn’t want to give SF an increase beacause they don’t want other Fla carriers to ask for one as well. They would be next in line. Most know they are under-priced.
SF Florida is also not what I would call a secured insurer. Not rated by AM Best either just like almost all of the property insurers in Florida. The biggest problem I see is the eating up of capacity by letting SF walk- that and McCarty is demanding SF agents be allowed to write with other insurers.
Mike – thanks for this bit of clarity –
“I am amazed that the State of Florida is telling SF what they have to do to run their business. The State unilaterally doubled the wind mitigation credits after SF was instrumental in helping develop the Wind Mitigation Credit program. Then refused to approve a rate increase which was necessitated by the unexpected premium credits. Ins. Commish/Crist now say FL will be better off w/o SF because they have all these little companies that are just dying to write homeowners policies in FL. If there are so many companies eager to give State Farm competition why refuse the rate increase. If State Farm rates are too high clients will go the many, many little companies that desperately want to write these SF policies. Let the market solve the situation and do not put the property/business owners of FL on the hook more than they already are now. State Farm can buffer the State from the bankruptcies of these smaller companies when a major storm hits our State.”
Let’s assume that I’m a new underfunded Florida domestic – and I know it. What if I start thoroughly inspecting all my risks prior to policy renewal and weeding out the shaky risks through non-renewal cancellation – send ’em packin’ back to Citizens or to the other new domestics? Kind of a wind mitigation inspection in reverse – If Joe Homeowner’s property doesn’t measure up to my underwriting standards – he becomes Citizen’s problem sooner or later.
Do you think I can survive a couple Cat 3’s or 4’s then?
that already happens with Citizens takeouts. They buy 50,000 policies and at renewal start inspecting and a small percentage of the policies taken out wind up right back in Citizens. The State will do nothing about it- not their problem according to them. Politics is why the OIR will not give rate increases on property insurance. SF isn’t the only company to have been denied a rate increase within the last 24 months. The only way to change things is at the ballot box and according to polls I have seen- the Governor has a 73% approval rating.
I believe that Gov Charlie Crist is getting his States financial budget advice from Obama. Run off those that are responsible and reward those that are irresponsible and give the bill to the tax payers later after they are out of office.
OIR should also include a clause that SF agents that must place their home policies with another carrier can not be forced to write them back to SF later – if SF decides to re-enter the market in Florida. Farmers Group almost withdrew from the Texas market in 2002. As a semi-captive FIG agent I placed a lot of home policies with other carriers for months before FIG and the TDI worked out their differences. However, FIG continues to pressure agents to rewrite those policies back to FIG. Many of these carriers offer better coverages and lower premiums than FIG – the customer isn’t going to change back to FIG. SF agents in Florida need to have this problem addressed now.
However, I think we all agree the best answer is to let SF have their increase and let the consumers decide.
OK Rater – I was thinking about your comment all day – “Once a storm hits there will be an emergency rule to stop all canx. and non-renewals and SF will still be here with policies 3 years from now. Mark it down.” – and I probably won’t sleep too well tonite. If what you predict comes to pass – I’m wondering if we should all surrender now. The key is under the front door mat Charlie.
If I were SF, I’d tell McCarty enough of his BS. Instead of the prior plan, we plan to completely pull out of FL so these start up companies can not only have the property business but the auto, life, etc. And instead of the prior 2 year plan, we will start issuance of non renewals immediately (or whatever is allowed by law/policy conditions). With each non renewal would be a letter of apology to the insured, explaining that due to the current political environment with the Gov and the Ins Dept and Sink, SF is unable to write insurance in the state and make a profit.
If I remember correctly, I think OIR/Gov are pissed at Allstate and probably other national carriers, and if something isn’t done about the insurance crisis in that state soon, it will be only Citizens and the new start-up to write business there. 1st big blow that comes through, and FL is the 1st state in the nation to file for bankruptcy, with each property owner being hit with huge assessments for the next 10 years.
So are non-SF agents being told not to place business into CPIC as well?
Why doesn’t the State of FL make an offer on the whole SF book and the agency contracts/infrastructure? Why would they pass up the investment opportunity on what they have convinced the voting public is such a money machine? Give the people what they want.
Who needs a lottery to generate revenue, this is a goldmine.
Let’s make it interesting. Let’s call on the Gov, the Commish, and all the State Fund and CPIC execs to pledge a 10% salary garnishment and a prohibition from seeking election to any federal/state/local position commencing the day the next assessment is added to cover hurricane losses, and lasting as long as the assessment does.
Just asking for a small personal gesture to demonstrate their confidence in the strategic plan they’ve laid out for their constituents (and their grandchildren).
These strategies are based on sound financial analyses aren’t they? They encourage all their family and friends to use CPIC and the new companies – don’t they? It’s those evil national insurance companies that are lying to us – right?
One of the most important functions of the OIR is to protect the citizens against placing business with insolvent carriers and making sure they have the resources to pay claims in the event of a catastrophe. Ask yourself this question, Has the OIR done its job of protecting consumers against insolvency of these startup carriers?
I can’t believe I have gained a smidgeon of respect for McCarthy calling State Farms bluff. Let the SF agents roll the business into a another company, rather than losing the business. The solvency issue is another matter, but that would be there no matter which way the polices go. It is still a wreck waiting to happen.
Looks to me like the independent agents are the ones who are going to lose on this one.
Do you think that the public will have the same respect for Crist and McCarty when their carrier of 25 years cancels them and their State Farm agent does not know how to rate them with the new carrier who has no money.
I would hate to be a State Farm agent now!
I never thought I would say this but I am actually sorry for them.
customer owned company what to sell, who to sell it to, and what price to sell it at? What do you call it when the government requires you to sell your service at a loss? Where the hell is the ACLU? Where the hell is the attorney general? Where the hell is the Better Business Bureau?
I say we all call our House Reps and urge the federal government to intervene. Or we could form a militia and force Florida to secede. It’s federal taxpayers who will end up bailing out the Fl crybabies when the whole thing goes bust. Why should we respect state sovereignty while holes are being dug and then “come together as a nation” when the hole needs to be filled?
As stated elsewhere, the OIC has a duty to protect the consumer from underfunded insurers who cannot pay their claims. Who is verifying the solvency of ALL FLORIDA INSURERS?
Do they really want to run off the biggest and maybe the only insurer in the state who could actually pay their own claims? Again, which company does the heavy lifting regarding the guaranty fund
I don’t feel sorry for them. The ones I know have always bad mouthed other carriers and agents and done other things that I do not wish to mention in a public setting that at least were unethical and at worst worthy of license suspension. Nope- those SF agents have been on the “gravy train” long enough- they can do like I did and go out and start an independent agency on their own dime. McCarty wants SF to pay for their agents to go independent- he is a real piece of work.
It was funny seeing Crist and Obama together the other day. Is Charlie a real fiscal conservative. I wouldnt even call him a moderate. He is a democrat!!!
I think we have found a new Commerce Secretary who has no fundamental differences with the president!!!
SF has operated the last several years in Florida as a separate entity at least on the property side. SF of Florida is no more solvent than your basic Florida domestic company who was started 2 years ago. This is a mis-perception that is promulgated by the non-insurance professionals at OIR. As stated in the SF filing to withdraw from the state- even without another hurricane or other catastrophic event- they will become insolvent by Dec 2010.
Everyone should email Crist’s office and demand that he form a committee on how to attract new carriers to the state to write homeowners insurance. Louisiana, Hawaii, California and other catastrophic prone areas do not have the same problems we do. WE NEED SOLUTIONS NOW! NOT AFTER A STORM!
Do you really think the State OIR or the courts would allow Mother SF Boomfield Ill. to abandon their baby in time of need. I don’t think so. I know that SF and all other carriers have tried to insulate themselves from the inevitable assements after a storm, but I do not believe the courts or congress to allow them to do so at the expense of tax payers.
Cotyre wrote – ‘SF of Florida is no more solvent than your basic Florida domestic company who was started 2 years ago.’
If that were true, how do you explain the $750 Million shot in the arm SF Mutual provided SF Florida in order to pay claims? Are you telling me that the now famous 2 year Florida startups have that kind of backing? From whom? And what about that $750 million subsidy by SF policyholders from other states to SF Florida that will now never be rightfully repaid? Here’s an idea – let’s require Floridians to subsidize claims from the California wildfires. How about the Kentucky ice storms. Lets throw in Washington flooding.
We all agree that SF Florida cannot take another hit and pay claims. So tell me again, what is the problem with SF Florida charging an amount that results in rate adequacy?
Newsflash – SF agents don’t want to represent some turd startup. They know that one day they’ll be called upon to ACTUALLY PAY THE CLAIMS.
So Bill thinks that charging an amount for insurance that allows the carrier to remain solvent comes at the expense of the taxpayers? Hey Bill – your a few months ahead of yourself. I don’t think we will sink into complete socialism until mid May. Then the taxpayers will carry 100% of the load.
Bill – please be patient.
I thought the Gov. was glad to see SF leaving b/c we have CPIC. Guess he was lying yet again. Why do all these Natl. co’s want to leave Fl? Two reasons: (1) the Gov and (2) the OIR. They set rates and deny they do. Once a storm hits there will be an emergency rule to stop all canx. and non-renewals and SF will still be here with policies 3 years from now. Mark it down.
Excuse me? SF of Florida would not have paid a dime for hurricane loss in 2008 unless damages exceed it’s reinsurance amount. Which by the way, last year they over-insured by 200%. Payments going to mother State Farm.
By the way, there are insurance companies in Florida that have been in business since Andrew… And only now I’m finding out with cheaper rates than SF of Florida.
SF can kiss my butt… I’m dropping my home, 3 cars, RV, boat and life insurance as soon as my quotes come back from 4 agents. I really don’t care if I have to pay the same or a little more.
read the filing of withdrawal. SF Florida is still indebted the SF mothership. What was the reason that SF, Allstate and Nationwided set up separate subsidiaries in Florida? I can only think of 1 reason.
All we in Florida have to do is look to Louisiana and see how they have handled things since Katrina. By comparison in Florida- instead of doing the people’s business in an ethical, democratic fashion-our politicians have to artificially suppress rates for the exposure to get votes and cater to the AARP crowd. This state is a cesspool of exceeded authority by all government officials from the state down to the city and county. The solution to Florida’s property insurance crisis is simple- tell the OIR to regulate and not dictate and beg companies to come into the state- let them charge what they consider as actuarially sound rates and let the competition begin.
who knows what the courts will allow. That is a whole another problem. But I will tell you this- the separate entities were setup to capitalize on FIGA and Hurricane Catastrophe Fund. Why should SF, Allstate or any other national carriers subject their companies to catastrophic losses and/or insolvency when the Florida OIR will allow companies to start writing property insurance provided they can come up with $10,000,000. Under capitalized companies receiving the Florida OIR stamp of approval for financial stability and solvency. Its a joke.
Sorry, Someone. You are forbidden from canceling SF. You will be forced to buy SF. What goes along with forcing SF to take you is that Florida will force you to take them. At whatever rate Florida decides, good or bad.
I coined a phrase a long time ago – what’s good for the hen is good for the rooster, or something like that.
It’s too bad you can’t cancel State Farm.
If you could it would be one less out of stater that I have to pay for.
The little guys who do not rely heavily on the Cat fund for reinsurance are at least as solvent as State Farm Florida who is bleeding money because of this huge loan from prior hurricanes along with extreme reinsurance costs from the parent company.
I try to keep a neutral opinion in these situations. I hate it that State Farm wasn’t granted their rate increase because the free market should dictate rates, not politicians.
you are absolutely correct Mr. Solvent. Guess the taxpayers and residents of this state will only find out who the real culprit is when the next CAT 3-5 storm hits and the state has to beg the Feds for a bailout.
Many of you might not know this but, back in November 2008 State Farm had Charlie Crist sign a law allowing SF to give a 17% discount on their auto insurance if the policy owner bought a CIPIC policy thru a SF agent. I know this because I worked for an agent until recently. SF claim is that other auto carriers offer discounts for “HOME OWNERS” but the other auto insurers don’t require that your client have a homeowners policy with you.
So what was SF game plan? Pull out of Fl.homeowners but keep auto their biggest profit maker. They know that when a client calls us the indepents for a quote on older properties there are very few Private insurance companies underwriting those policies and you will end up offering a CIPIC policy. When the customer calls his SF agent with a comparison the agent is going to tell them they can get 17% discount on their auto if they keep everything with SF! How can we compete!!! And I started my own independent agency 2 months ago and I called all these new start up insurers that are happy to appoint SF agents but, I only get a response that they are not taking new appointments at this time from the independents!! All this time we the independents are the ones that have been the marketing back bone or those Private insurers and SF was the compittion and they now want to embrace SF agents as the protical son. I can’t beleive it!!
this is exactly my complaint. SF agents have for years had advantages over us independents- bad mouthed the admitted carriers we have- marketed their product as the most financially stable due to company rating(SF Florida was demotch rated not Am Best rated). The only advantage we have had- is we were more flexible, able to insure just about any risk and now the OIR is mandating that SF allow their agents to act as an independent and these companies we have will jump in with SF agents with both feet- they will eat up our capacity, they will be allowed to roll over their clients to these companies even if they do not regularly fit their guidelines. It is sickening. The only thing I can do is to drop any and all companies who get in bed with SF and move all that business to those who don’t. OIR and Crist are worried about 826 SF agents statewide losing their jobs. Let the SF agents do what you and I did- foot the bill to start their own independent agency instead and let them competition begin.
You are so right. What needs to be done is tell SF if they pull out of homes they have to pull all their products from the State.
Your observations about Charlie and Kevin are true- Charlie will be moving on soon to Congress or US Senate and Kevin will get hung out to dry by the next Governor. As far as the little domestics- most won’t survive a major storm, but that is no different from State Farm Florida. Heck- they are going insolvent by Dec 2010 even without another storm. And I know many of you believe that the parent company Big SF would have rescued them- but that is not true. Why else did they bother to set up a subsidiary for Florida only? Come on I am not that gullible.
Your observations about Charlie and Kevin are true- Charlie will be moving on soon to Congress or US Senate and Kevin will get hung out to dry by the next Governor. As far as the little domestics- most won’t survive a major storm, but that is no different from State Farm Florida. Heck- they are going insolvent by Dec 2010 even without another storm. And I know many of you believe that the parent company Big SF would have rescued them- but that is not true. Why else did they bother to set up a subsidiary for Florida only? Come on I am not that gullible.
So, if private insurers will only take “up to” 500k policies…what happens to the rest? I know…they go to Citizens so we can subsidize them. The state is so blinded by the price of a policy, that they ignore the fact that the coverages are offered by these little companies are worse, service is worse, and if there is ever a hurricane, all of these little new companies will close shop and leave us all waiting on the phone for hours trying to find someone at the state that will listen to us cry and explain to us how busy they are and that we won’t get our claims paid for the next year…leaving us without loss of use coverage etc. Chuck and Larry (oops…honest mistake), I mean Chuck and Kevin better hope they get out of state politics before there is a storm and these chickens come home to roost!
NU GUY ON THE BLOCK. Why? Do you plan to force all businesses to carry products they lose money on? Where is the logic in your position?
Don’t be fooled by the AM Best rating. State Farm Florida buys its reinsurance from State Farm Mutual. State Farm Florida has not added to the potential burden that the State of Florida has placed on Florida property owners from Citizens and other small, undercapitalized companies. That is where your assessments have come from and will in spades in the future. Remember none of the assessments we are now paying on our homeowners, auto, etc policies has been caused by State Farm Florida. Why would we want to force a long term solid property protector out of Florida and force folks to buy from a much less secure protector with the liklihood of another Poe, or Poes, occurring. WE are Citizen’s reinsurer——up to $16 Billion or more none of which has been contemplated to be caused by State Farm but will have to be borne by the residents of Florida.
There is no logic, Yes they are all going to be insolvent, and logic says you must increase your premiums to deal with the situation at hand. What is more logic is to come up with a solution. Hawaii plan is the only one I have seen that somewhat works in a cat prone area. An actuarial correct windstorm policy everyone in the state pays for in addition to your HO3 policy, like we currently are doing with Flood. And yes, I know what the combined ratio for the national flood program is, but it would be a start and would allow for competition to return on the HO3 that we currently do not have.
I am ok if the state wants to commit financial suicide, Just write the policies and hope they are able to pay after the storm. Then wow! the premiums will shoot through the roof once the state is bankrupt and they need carriers at any cost. We will be writing HO3’s through Scotsdale and lloyds at $8000. for a 200K home. We better find a solution now or this is what is going to happen to the consumers in florida. But hey I am ok with it if the Governor is!
And you Florida agents thought you were in a free country.
I am happy to inform you that we have found a republican who will go along with my socialist agenda and will not feel any remorse for sticking it to the tax payers of our great new socialist society.
CHARLIE CRIST
National carriers set up subsidiaries in Flordia because they are required by Florida law to do so. Don’t blame SF for SF Florida. Every non-domestic carrier is required to set up a domestic carrier in the state and actually have a “home office” in the state. Another goober law – which has been on the books for at least 30 years.
what is the amount of reinsurance coverage SF Florida purchased from SF??
nobody important, my take on this is that SF wants to pull out of Florida because they say they are loosing money daily and that if they don’t increase their rates that they will be insolvent in 2 years without any storms? This sounds to me that they may have to much internal costs that are putting them out of business. You do know that SF hasn’t written any new homeowners business in South Florida since 1996. I’m no genious but if your salaries keep going up at the home offices and your not bringing in new customers your going to have some problems with cash flow sooner or later. SF just wants everything placed on a silver platter. I say again, that McCarthy and Sink should tell SF that if they threaten to leave the Homeowners hanging they should also stop selling Auto insurance and leave the State.
What do you care if their internal cost’s are high? That’s SF’s business not yours. If Florida had a FREE MARKET, competition would take care of that. Politicians understand this, but explaining that will not get them votes. Remember the most important thing to a politician is keeping his job/power. These guys are ego maniacs. Term limits would correct this problem, but politicians always find a way to kill that movement.
Again NU, why? If the property rates were too high people would use another carrier. If the property rate the state allows isn’t enough to make a profit why should SF stay? And, why shouldn’t they be allowed to sell other products? Does your local store have to carry some products at a loss to be allowed to sell others? I wish you would apply just a little logic to your position.
Can you give me the Florida Statute number? There is no law that a carrier be domiciled in the State of Florida. Most companies did do so because they are affraid of what will happen after a storm. They will be required to purchase unsold bonds to pay the claims of FIGA and the Cat fund etc. Most are anticipating filing for chapter 11 in the event of a state bankrupcy instead of paying for the states irresponsibility.
I am amazed that the State of Florida is telling SF what they have to do to run their business. The State unilaterally doubled the wind mitigation credits after SF was instrumental in helping develop the Wind Mitigation Credit program. Then refused to approve a rate increase which was necessitated by the unexpected premium credits. Ins. Commish/Crist now say FL will be better off w/o SF because they have all these little companies that are just dying to write homeowners policies in FL. If there are so many companies eager to give State Farm competition why refuse the rate increase. If State Farm rates are too high clients will go the many, many little companies that desperately want to write these SF policies. Let the market solve the situation and do not put the property/business owners of FL on the hook more than they already are now. State Farm can buffer the State from the bankruptcies of these smaller companies when a major storm hits our State.
Mike, your logic makes sense and should be the way this should play out but the OIR doesn’t want to give SF an increase beacause they don’t want other Fla carriers to ask for one as well. They would be next in line. Most know they are under-priced.
I believe what you are saying but that really sounds like a scary place for the policyholders of FL to be — being force fed unsecured insurers.
SF Florida is also not what I would call a secured insurer. Not rated by AM Best either just like almost all of the property insurers in Florida. The biggest problem I see is the eating up of capacity by letting SF walk- that and McCarty is demanding SF agents be allowed to write with other insurers.
Mike – thanks for this bit of clarity –
“I am amazed that the State of Florida is telling SF what they have to do to run their business. The State unilaterally doubled the wind mitigation credits after SF was instrumental in helping develop the Wind Mitigation Credit program. Then refused to approve a rate increase which was necessitated by the unexpected premium credits. Ins. Commish/Crist now say FL will be better off w/o SF because they have all these little companies that are just dying to write homeowners policies in FL. If there are so many companies eager to give State Farm competition why refuse the rate increase. If State Farm rates are too high clients will go the many, many little companies that desperately want to write these SF policies. Let the market solve the situation and do not put the property/business owners of FL on the hook more than they already are now. State Farm can buffer the State from the bankruptcies of these smaller companies when a major storm hits our State.”
Let’s assume that I’m a new underfunded Florida domestic – and I know it. What if I start thoroughly inspecting all my risks prior to policy renewal and weeding out the shaky risks through non-renewal cancellation – send ’em packin’ back to Citizens or to the other new domestics? Kind of a wind mitigation inspection in reverse – If Joe Homeowner’s property doesn’t measure up to my underwriting standards – he becomes Citizen’s problem sooner or later.
Do you think I can survive a couple Cat 3’s or 4’s then?
that already happens with Citizens takeouts. They buy 50,000 policies and at renewal start inspecting and a small percentage of the policies taken out wind up right back in Citizens. The State will do nothing about it- not their problem according to them. Politics is why the OIR will not give rate increases on property insurance. SF isn’t the only company to have been denied a rate increase within the last 24 months. The only way to change things is at the ballot box and according to polls I have seen- the Governor has a 73% approval rating.
I believe that Gov Charlie Crist is getting his States financial budget advice from Obama. Run off those that are responsible and reward those that are irresponsible and give the bill to the tax payers later after they are out of office.
OIR should also include a clause that SF agents that must place their home policies with another carrier can not be forced to write them back to SF later – if SF decides to re-enter the market in Florida. Farmers Group almost withdrew from the Texas market in 2002. As a semi-captive FIG agent I placed a lot of home policies with other carriers for months before FIG and the TDI worked out their differences. However, FIG continues to pressure agents to rewrite those policies back to FIG. Many of these carriers offer better coverages and lower premiums than FIG – the customer isn’t going to change back to FIG. SF agents in Florida need to have this problem addressed now.
However, I think we all agree the best answer is to let SF have their increase and let the consumers decide.