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Like A Good Neighbor, State Farm Isn’t There

State Farm to no longer accept any new property, casualty insurance applications in CA

By Evan Symon, May 27, 2023 2:30 am

State Farm Insurance, the largest property and casualty insurance company in California, announced Friday they would no longer be accepting new applications for any kind of insurance other than personal vehicle insurance due to large increases in construction costs and inflation.

The Illinois-based company specifically noted in a press release on Friday that all new applications for business and personal lines property and casualty insurance will no longer be accepted in California beginning May 27th.

“State Farm General Insurance Company, State Farm’s provider of homeowners insurance in California, will cease accepting new applications including all business and personal lines property and casualty insurance, effective May 27, 2023,” said the company in a press release on Friday. “This decision does not impact personal auto insurance. State Farm General Insurance Company made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market.”

“We take seriously our responsibility to manage risk. We recognize the Governor’s administration, legislators, and the California Department of Insurance (CDI) for their wildfire loss mitigation efforts. We pledge to work constructively with the CDI and policymakers to help build market capacity in California. However, it’s necessary to take these actions now to improve the company’s financial strength. We will continue to evaluate our approach based on changing market conditions. State Farm independent contractor agents licensed and authorized in California will continue to serve existing customers for these products and new customers for products not impacted by this decision.”

While insurance companies have been reducing their presence in California in the past few years, some have made it harder for residents to obtain insurance, such as GEICO closing down all 38 of their offices in the state last year and State Farm raising driving insurance rates in March. A complete pull out of new insurance applications deals a major blow to the state.

“Costs, inflation, growing catastrophe exposure, that last one meaning wildfires, have all played a part in insurance companies balking at California,” explained Trevor Connery, a lobbyist who has worked for insurance companies in the past, to the Globe on Friday. “But even Farmers, GEICO, and others still off full services. State Farm has just been seeing too many claims and really doesn’t want to risk more right now.”

“Everyone knows things cost more in California, and that carries over to things like insurance costs. Even before the upswing of wildfires, earthquakes and other natural disasters kept costs up. For many, auto insurance was really the last bastion where they weren’t really hung out to dry, especially with insurance being required to drive here. There’s hope that this won’t lead to more insurance companies following their lead and stopping new applications, but only time will tell. If more do, this could become a serious problem, and the state could een step in, and that is a thought no one really wants to have right now.”

The new State Farm policy changes are to go into effect on Saturday May 27th.

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10 thoughts on “Like A Good Neighbor, State Farm Isn’t There

  1. Hey Newsom!!!
    Make sure you include THIS accomplishment in your Presidential campaign packet!!!
    Way to go….

  2. DEMOCRATS ARE DANCING ON AIR! One step closer, day by day incrementalism toward government single-payer insurance of every kind…auto, fire, life, health, you name it. To Donkeys, the endgame it governmental master and overlord of everyone, everything, always. That’s the grand vision, and if it takes a few hundred years to get there, so be it…but that’s where they want to go and sheeple go along as long as movements aren’t so abrupt as to be uncomfortable. EVs, all-electric everything, mandates, “crackdowns,” you name it. Every day a new rule or restriction. Just look in the mirror for the last 50 years. If that doesn’t scare you, you’re dead.

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