State Farm gets rate bump

[Aquawind]

State Farm gets rate bump
Average 40 percent on Lee coast; 8.6 in state

By Dick Hogan
Originally posted on November 24, 2005


Property owners who use State Farm Insurance on Lee County's barrier islands will see their policy rates jump an average of 40 percent.

Statewide, the company's rate increase will average 8.6 percent.

But a lot of people will pay much more.



"All beaches and islands lying west of the mainland, including Punta Rassa" will see the 40 percent spike, according to State Farm statistics.

The rest of the county will see a less dramatic increase: an average of 7.4 percent in most areas, including wind coverage.

The state Office of Insurance Regulation approved the higher rates Tuesday.

State Farm customer Arthur Compton, 68, isn't happy with the increase.

"I feel terrible about it," said Compton, who lives in a canal-front house in Cape Coral. "I haven't made a claim for anything. I upped it to the 5 percent level so I'd have to have a claim of $9,000, but I'm paying for everyone else's damage."

Compton, a retired Bell Atlantic manager who describes himself as "sort of a weather buff," was able to drop his flood insurance three years ago because the house is paid off.

He will, however, keep his homeowners policy.

The problem, he said, is "people who make a lot of claims should pay more than people who don't make claims."

Anita Cereceda, owner of the Local Color boutique on Fort Myers Beach and former mayor, said the 40 percent increase will be a hardship for many in the island town.

"I think Fort Myers Beach has so many retirees, so many people who even though it may be a high fixed income, they don't have any more incoming," she said. "The cost could be very difficult for them to bear."

State Farm public affairs specialist Jose Soto said the company is making sure the increases are fair.

"If the individual has a lot of claims in the past not related to hurricane or catastrophe," his rate will be higher, Soto said.

He said the company looks at prior experience.

"We customize it," Soto said. "We're not going to say everything's going to be the same. Some areas went down as much as 5 percent in other parts of the state."

The increase is mainly due to higher costs of non-hurricane claims and the rising price of building materials, he said.

"It wasn't just hurricanes," he said.

For new policies, the rates approved Tuesday will go into effect Feb. 1 and for renewals, April 1, Soto said.

Policyholders should take the opportunity to take a look at their coverage, he said.

"People need to sit down with their agent and evaluate their policy," he said.

Steve Burgess, state insurance consumer advocate, questioned some of the insurer's requests for higher premiums.

"I'm inclined to say that I'm disappointed that they granted them the total amount of the increase ... because I thought we asked them very credible issues that they should have taken into account," Burgess said.

The state's third-largest home insurer, Allstate Floridian, said Tuesday it is appealing a decision to deny its proposed increases.

The company had requested average statewide increases of 16.3 percent and 24.4 percent for customers covered by the company's Allstate Floridian Indemnity Co. subsidiary.

Last month, state Insurance Commissioner Kevin McCarty told Allstate Floridian that his office was rejecting its proposed increase because the company did not provide assumptions for catastrophe models used in the rate request.

"We understand this is not popular, but it's necessary," Allstate Floridian spokesman Ryan Priest said. "We're still adamant that that is a rate that is actuarially justified and appropriate."

— The Associated Press contributed to this report.



SW FLORIDA RATE COMPARISONS
Here's a comparison of how State Farm Insurance plans to increase its rates in Southwest Florida and statewide:
• Lee County: Average rate increase of 40 percent on barrier islands; average increase of 7.4 percent elsewhere.
• Charlotte County: West of the Myakka River and Charlotte Harbor will have a 4.8 percent increase; the rest of the county, 7.7 percent.
• Collier County: All areas west of U.S. 41 have an average increase of 3.7 percent. The rest of the county has a decrease of 3 percent.
• Statewide: Average 8.6 percent.


http://www.news-press.com/apps/pbcs.dll ... 40423/1075

[NC George]

State Farm customer Arthur Compton, 68, isn't happy with the increase.

"I feel terrible about it," said Compton, who lives in a canal-front house in Cape Coral. "I haven't made a claim for anything. I upped it to the 5 percent level so I'd have to have a claim of $9,000, but I'm paying for everyone else's damage."

Come on now, what do you think insurance is? Everyone chips in, and those with damage get reimbursed. You suffer no damage - you pay for everyone else's.

[Steve Cosby]

Come on now, what do you think insurance is? Everyone chips in, and those with damage get reimbursed. You suffer no damage - you pay for everyone else's.

And, (stealing from Sheriff Buford T. Justice), that's just pure and simple communism.

(this is supposed to interject some levity)