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State Farm General, the largest insurance company in California, asked state officials to increase the emergency rate by 22 % on Monday, claiming that Los Angeles Provincial fires had placed the company in a technical strait.
The insurance company, a subsidiary of the company, said that the company has already received at least 8,700 claims and paid more than a billion dollars to customers. She expects to pay “much more”, as fires are the most natural disasters in their history.
The company said in a letter to government insurance commissioner Ricardo Lara: “As your insurance commissioner, you can have a very significant impact on the ability of (the state of the public farm) to continue working in California by immediately approving temporary changes in the rate.”
The company also requires 38 % interest rates from rental housing and 15 % for tenants, with ease on May 1.
State Farm said that the last request is necessary for Rebuilding the company’s capital baseTherefore, you will not have to “restrict” the company’s ability to provide home insurance in the state. The insurance industry classification agencies said they expect an increase due to fires.
California insurance company has claimed that it had lost $ 2.8 billion over a period of nine years ending last year, including gains from investment income. It also indicated that the financial rating of the state Farm General last year was reduced by AM Best. The company said it would reach the reinsurance she obtained from her father to pay claims from Los Angeles fires.
State Farm General, which has about 20 % of the insurance market for home owners in 2023, secures about one million owners in the state, and has 1.8 million in effect.
The proposed rate is likely to be controversial. Last June, the company advanced a 30 % rate for homeowners policies, an increase of 36 % for the owners of the apartment and an increase of 52 % for the tenants. This request surprised state officials, as Lara said that he raised “serious questions about his financial condition.”
This price request is still suspended. State Farm said it was ready to issue the refunds for customers who pay temporary emergency prices if the administration agrees to an increase in the high interest rates he requested last year.
The company previously obtained a stumbling block of 6.9 % of the prices of home owners in January 2023 and raised by 20 % that entered into force in March last year.
“To protect millions of California consumers and the safety of our residential property insurance market, the administration will respond urgently and transparently to recommend a procedure for Commissioner Lara.”
The administration added any price rise in the price will not take place unless it is justified according to the ProP 103, which is the 1988 polling scale that gave the commissioner the authority to review, control and reject the proposed high prices.
The Consumers Group for Consumers in the Los Angeles Group opposed that Farm General was in a financial problem, claiming that the company achieved profits from the subscription of $ 1.4 billion from 2020 to 2023, while Parent State Farm Mutual had $ 134 billion in the bank.
She said: “The accounts of the state of State Farm should not fall on the backs of homeowners in California who recover from a disaster.”
In March, the company announced that it will not renew 72000 home, apartment policies and other properties, noting the high costs of reconstruction, increased risk of huge fires and outdated state regulations.
This follows Resolution in May 2023 To stop writing new business, homeowners and other personal property insurance and loss of losses in the state, with the exception of personal car insurance.
Last month, after the size of Los Angeles fires became clear, the state of Farm amended its decision and said it would provide a renewal of any policy holder affected by the Playgads, Eiton and other provinces fires whose policies did not run before the start of the fires January 7.
The insurance company estimated that it will be applied to approximately 70 %, or 1100, out of 1626 residential policies that were in the main postal code in the Pacific when it announced the non -sums of the people last year.
Later, the renovation was expanded to any Los Angeles Provincial Police holder on the same conditions. The company said it has about 250,000 residents of the province’s residential documents.