Office Reaches Agreement with State Farm Florida; State Farm Florida Withdraws its Plan to Leave the State and Agrees to Non-Renew no More than 125,000 Residential Property Policies
– The Florida Office of Insurance Regulation (Office) today announced that Commissioner Kevin McCarty has issued a Consent Order
that resolves the pending litigation between State Farm Florida and the Office over State Farm Florida’s plan to leave the property insurance market. By the terms of the Consent Order, State Farm Florida will remain a significant player in the Florida residential property insurance marketplace.
"This agreement is the product of a long and arduous negotiation process,” remarked Commissioner McCarty. "The final result is beneficial to the people of the State of Florida, and beneficial to the Florida insurance marketplace. The consent order satisfies the Office’s requirements issued in our Order dated Feb. 13, 2009, and allows State Farm Florida to remain a viable insurer in the Florida market."
Under the terms of the Consent Order, State Farm Florida will non-renew no more than 125,000 policies of its 810,416 residential property policies
reported as of Oct. 2009. Even after these non-renewals, State Farm Florida will remain the largest private insurer of property insurance risk in the state of Florida. The Consent Order also grants State Farm Florida a 14.8 percent rate increase for all homeowners’ and condominium unit owners policies, which was based on information provided to the Office by State Farm Florida.
The consent order concludes a series of events
that began with the Office's denial of State Farm Florida's ultimate average rate request of 67.1 percent. The Consent Order signed today results in the withdrawal of State Farm Florida’s withdrawal plan filed Jan. 27, 2009 and the cancellation of the Jan. 25, 2010 hearing before the Division of Administrative Hearings.