Insurance Commissioner Lara to Review State Farm’s Proposed Rate Increases
State Farm has announced plans to raise rates for homeowners by 30%, condo owners by 36%, and renters by 52%, issuing an ultimatum to the state of California. The insurer has refused to sell new policies in the state in the summer of 2023.
“This has the potential to affect millions of California consumers and the integrity of our residential property insurance market,” said Insurance Commissioner Ricardo Lara. As the filings proceeded through regulatory channels, Lara emphasized the importance of a thorough review to understand the company’s financial situation.
A State Farm statement on the matter said, “We continue to look for ways to maintain competitive rates and help our customers manage their risk. Customers with questions are encouraged to speak with their local State Farm agent. The agent can review the customer’s policy, including deductibles and coverages.”
“State Farm General’s latest rate filings raise serious questions about its financial condition,” Lara added, highlighting concerns over the nation’s leading insurance firm.
This marks State Farm’s third major rate hike in California within the past year. Last summer, the insurer ceased issuing new home insurance policies in the state, attributing the decision to wildfire risks and rising construction costs.
Last December, State Farm received approval for a 20% hike in homeowners’ and condo owners’ policies.
