Posted on 05/27/2023 3:12:05 AM PDT by Libloather
America's biggest home insurance company has announced it will no longer insure houses in California, saying that the risk from wildfires was too great and the cost of rebuilding too high.
State Farm, the nation's biggest car and home insurer by premium volume, said existing customers would not be affected.
But from Saturday, no new home insurance policies will be issued. The company will continue offering auto insurance.
State Farm said it 'made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market.'
In its statement, State Farm said it takes 'seriously our responsibility to manage risk.'
The Bloomington, Illinois-based company said it was 'necessary to take these actions now to improve the company's financial strength.'
They added: 'We will continue to evaluate our approach based on changing market conditions.'
State Farm's move follows the decision last year by American International Group to end the insurance policies taken out on thousands of expensive properties. The group notified their high-net-worth clients in California that their policies would not renew.
The notices were part of a plan by AIG to cease selling home policies in California through a unit regulated by the state's insurance department.
Michael Soller, a deputy insurance commissioner for California, told The Wall Street Journal that the state was working hard to reduce wildfire risk.
He said they were 'really going after the root causes of the insurance issues, which is the wildfire risk'.
Soller said California has created an insurance-discount program that takes into consideration wildfire-mitigation investments by consumers.
'The factors driving State Farm's decision are beyond our control, including climate change, reinsurance costs affecting the entire insurance industry, and global inflation,' said Soller.
The EPA, in their section devoted to California's wildfires, confirm the situation is worsening.
(Excerpt) Read more at dailymail.co.uk ...
Just because the EPA says it, does not make it true.
Florida is suffering a similar problem caused by different reasons.
So many people are moving to Florida and many of them want to live as close to the ocean as their finances allow.
End result is they are building on what at one point was swamp land, so when a hurricane hits which is inevitable in Florida, it tears up many more homes than 50 years ago.
The property insurance rates in Florida have skyrocketed and a couple of companies have left.
He's wrong. The real issue is not the frequency of the wildfires, but the cost of the housing. Replacing a $60K house is one thing, but housing in California averages over $700K.
a lot of insurance companies are pulling various insurances in CA.
I cannot get commercial auto from Geico, Allstate, State farm, or progressive, for tow trucks anymore.
few other crews I know say their street sweepers and pressure washer rigs can’t get insured by those guys either.
Just more of the left enjoying the left nothing to see here move on.
Getting what they voted for.
This is nuts. Insurance is a risk analysis industry. Surely there must be premiums that can be set to factor in the variables. There is something else at work here and it is likely the globalist plan to drive home ownership into the ground. The world architects want everyone living in Communist style low income state housing or tents on the street.
No different than a widget-maker declaring that it will no longer manufacture widgets because of "market changes."
After all, it's not like there was something called the "Law of Supply and Demand," right?
Regards,
Do you know why? Is it really just about wildfires?
If an insurance company was willing to insure Liberace's hands for millions of dollars, why can't State Farm insure houses for $700k?
All they have to do is jack up the premiums, right?
Regards,
>>The property insurance rates in Florida have skyrocketed and a couple of companies have left.
Much more than a couple have left.
few other crews I know say their street sweepers and pressure washer rigs can’t get insured by those guys either.
Do you know why? Rates for my truck here in NY go up 1200.00 each year.
State Farm has always been the most overpriced insurance company in the Country; people are getting smart and quit buying their product.
Good move. Doing any business in That state is too risky.
“Between 2013 and 2020, Florida’s property insurers paid out $15 billion in claims costs. Only 8% percent of that was paid to consumers, while 71% was paid to attorneys.”
https://www.abcactionnews.com/news/price-of-paradise/roof-repair-scams-push-florida-insurers
“’Let’s just give an example, $100,000 settlement $70,000 is going to the attorney, and maybe the other $30,000 is going to the roofing contractor. The policyholder is not even involved,’ Friedlander said. ‘So what may be just, say a $5,000 to $10,000 repair to a roof could run well into six figures.’”
It's the same with north carolina/ Myrtle Beach area. They are filling in swamps, places you couldn't walk thru after a moderate rain. Building slab homes. And LOTS of them, 10'S OF 1000'S of new homes built on swamp.
OTOH, another point....They must drive different in N.J. ,N.Y., Connecticut. because rear ending people at stop lights, driving 15-25 mph over the speed limit, driving off the road in broad daylight, hard braking to let someone out of a dollar general parking lot and getting rear ended, is the norm here.
and all while talking on the phone. and as an extra bonus most are over 70.
wish I had a dollar for every accident I've seen where the driver is out of the car and still is yapping on the phone on the side of the road!
seriously, the Leo's around here need to start stopping the old lady drivers who are phone googlers/ phone yappers/ and general head up your ass drivers.
If I were to live in Florida I’d want to be maybe 5 or 10 miles inland.
About 3 weeks ago, I noticed a podcast guy (usually covers banks and finance) openly said that a major player in California insurance would cause a ripple-effect by 1 June. In his description, it would open up various national brand insurance companies to cease California ‘protection’ by late summer.
The question is....if they cease, are there minor players willing to play the game and meet demand, or are you looking at a national crisis where Newsom has to convene a team and rethink their whole agenda.
I should also suggest here...if you were a small business guy (home-repair, lets say) with several vans and a dozen employees...can you still operate if insurance rates double or triple for commercial insurance? Or would this be enough to force you to exit the state, to survive?
You need to be more than that, 5-10 miles and you might still be over the intercoastal waterway and subject to the major force of a hurricane, get further inland, 20-25 miles at a minimum in my opinion, you are still relatively close to the ocean and better protected from a hurricane.
I’ve lived in Florida all my life, people who move to Florida need to realize, if you live here long enough, you will be hit by a hurricane, if you are inland, you are probably fine, be ready, have a few supplies in case power is out for a few days and DON”T PANIC like most of the people here do.
Gas Stations run out of fuel, grocery stores become madhouses, etc.
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