State Insurance Commissioner Alice A. Molasky-Arman has approved State Farm Fire and Casualty Company’s request for an overall statewide average increase of 5.2 percent, or $2.5 million. This is part of a total increase of 24.9 percent requested by State Farm earlier this year.
The initial rate increase, which saw an overall statewide an average of 17.9 percent became effective March 15, 2003. Molasky-Arman had initially denied State Farm’s earlier request for a 24.9 percent increase in September 2002, because at that time, the data appeared inconsistent an the catastrophe load appeared high for non-tenant homeowners. State Farm subsequently filed additional information that supported an increase.
In the 17.9 percent rate approval, rates increased approximately 19 percent for non-tenant homeowners, 18.3 percent for condominium owners, 0.1 percent for renters, and 25 percent for business property. The minimum premium for non-tenant homeowners increased from $125 to $150 and from $75 to $100 for condominium unit owners. In addition, modifications were made to deductible credits. For example, a policy with a $1,000 deductible currently has a 14 percent credit, with a maximum dollar credit of $300. This will change to a 9 percent credit, with a $200 maximum credit.
The 5.2 percent increase is effective on June 10, 2003 for both new and renewal business. The apportionment to the three classes of homeowners business amounts to an increase of 5.0 percent for non-tenants homeowners, 18.6 percent for condominium unit owners, and 0.0 percent, or no change for renters.
Generally, State Farm non-tenant insureds in Carson, Douglas and Clark Counties will experience the largest increase of about 25 percent, while insureds in a portion of Washoe County will receive the smallest increase of about 7 percent. State Farm insures over 83,000 non-tenants, 13,000 renters, and about 8,000 condominium owners in Nevada.
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