“Insurance Market in Chaos: Fourth Major Insurer Pulls Out of Florida”

  • Farmers Insurance will no longer provide coverage in Florida, affecting tens of thousands of residents.
  • This decision makes Farmers the fourth major insurer to withdraw from Florida in the past year due to the state’s vulnerable insurance market and increasing threats from extreme weather.
  • Farmers has informed the Florida Office of Insurance Regulation about discontinuing their auto, home, and umbrella policies in the state.
  • The company has cited the need to manage risk exposure as the reason behind this business decision.
  • Florida law requires companies to give three months’ notice to the Office of Insurance Regulation before informing customers that their policies will not be renewed.
  • The specific details of Farmers’ exit from Florida have not been made public as the notice was classified as a “trade secret.”
  • Only company-branded policies, which make up approximately 30% of Farmers’ policies in Florida, will be affected. Policies sold by subsidiaries Foremost and Bristol West will remain unaffected.
  • It is estimated that around 100,000 Florida policies will be terminated as a result of this decision.
  • Farmers has also limited new policies in California due to the state’s record-breaking wildfires caused by climate change. Allstate and State Farm have taken similar measures.
  • The insurance market in the U.S. is being destabilized by climate change, leading to rising insurance costs in Florida. Homeowners in the state already pay about three times the national average, and rates are expected to increase by 40% this year.
  • Several insurers in Florida have gone out of business due to substantial payouts for storms, while stronger and more damaging hurricanes are being fueled by warmer air and water.
  • Florida Chief Financial Officer Jimmy Patronis has expressed his intent to explore every possible avenue for holding Farmers accountable if they withdraw from the state.

Leave a Reply

Your email address will not be published. Required fields are marked *