The Times reports that State Farm has filed papers with the State of Florida to eliminate or trim nearly all discounts for homeowners insurance in Florida. They claim it is an attempt to remain solvent, as they gradually withdraw from the Florida market.
"Many of our current discount or credit programs will either be adjusted, modified or, actually, many of them eliminated," State Farm spokesman Chris Neal said Friday.
State Senator Mike Fasano, R-New Port Richey, was briefed on the filing late Friday. He states he was told that the average State Farm policyholder may have to pay 40 percent to 44 percent more for property coverage. Fasano called the filing an "outrageous" way of "going around the law" to raise premiums without a formal rate increase. "The insurance companies always seem to find a way to help themselves and neglect the homeowner," he said.
State Farm denies that they have calculated an average policyholder increase. "There is no way whatsoever to have a number for an average affect on our customer. There's a range for individual credits and discounts, and it's not that simple," Neal said. "Some are cumulative (discounts) and some aren't. You simply can't add them together. … Even myself, I have no idea how it will affect my policy."
State Farm claims they are only cutting discounts in order to stay in business.
State Senator Fasano was particularly annoyed that State Farm would be repealing the discount for homeowners who proactively took steps to secure their homes from storm damage.
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