Mississippi Insurance Chief Criticizes State Farm’s 45% Coastal Rate Hike

August 25, 2009

State Farm is looking to raise coastal homeowners insurance rates in Mississippi an average 45 percent but the state regulator isn’t very receptive to the idea.

“I am not going to approve the present filing,” Insurance Commissioner Mike Chaney stated flatly, claiming the filing is riddled with “serious issues.”

The proposed increases would be in the coastal counties of Hancock, Harrison and Jackson.

State Farm cut back on its business in the state after Hurricane Katrina. Last August, the company was granted an average 13.6 percent increase statewide. At that time, it also initiated a mandatory 5 percent deductible on all home policies that include wind coverage.

In January of this year, the company resumed writing some renters policies in the state and in June it allowed its agents to start writing some new homeowners policies, but none of this new business is along the coast.

A spokesman for State Farm said his company believes it has “worked well with Commissioner Chaney in the past” to resolve rate issues and it will in the future.

Chaney, who has convinced some 40 new carriers to do business in the state over the past year and a half, told Insurance Journal that he doesn’t like State Farm’s unwillingness to write new coastal business, its storm deductible or its failure to offer mitigation credits.

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