Breaking News: State Farm Home Insurance Pulls Out of Florida

State Farm Florida plans to drop the following types of policies statewide: homeowners, renters, condominium unit owners, personal liability, boats, personal watercraft, personal articles, and business property and liability policies.

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State Farm Florida is pulling out of the homeowner insurance business in Florida, the company said this morning, in a surprise move that will leave more than 800,000 policyholders without coverage and will cause almost certain turmoil in the Florida insurance marketplace.

"Faced with steeply declining resources to cover future claims and expenses, State Farm Florida has little choice," said Jim Thompson, president, of State Farm Florida. ''This is not an action we wanted to take, but one we must take given the realities of the Florida property insurance market.

"We regret the impact this will have on our customers, employees and agents in Florida," he added.

Thompson said the plan requires regulatory review, and State Farm Florida will not begin dropping policies under the plan until that process is complete. Florida, however, has no law on the books that would prevent State Farm from leaving the state's homeowner insurance market.

State Farm Florida emphasized that it was submitting a two-year plan that seeks to limit disruptions for customers, and if approved, will allow them time to find coverage with other insurers.

State Farm is Florida's largest private homeowner insurer, second only to state-sponsored Citizens Property Insurance Co.

State Farm is also Florida largest automobile insurer with more than 3 million policies. The company says it will continue to offer auto coverage. However, a 2007 state law pushed by Gov. Charlie Crist prevents insurers from offering only auto policies if they offer both auto and homeowners in other states.



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New Citizens Property Insurance Co. requirement as of January 1, 2009

New Citizens Property Insurance Co. requirement as of January 1, 2009


Please Note:

According to regulations passed by House Bill# 7057 and effective January 1, 2009 all homes insured by Citizens Property Insurance Co. with an insured value of over $750,000 or more will have to be “hardened” (window shutters, hurricane proof garage doors) effective with the 2009 renewal date or the 2009 policy effective date. This order is inclusive of all personal lines residential structures located in the ‘wind-borne debris region’. Structures without opening protections as defined in s. 1609.2, International Building Code (2006) will not be eligible for coverage by Citizen’s Property Insurance Co. There are exceptions to the hardening procedure such as allowing for wood panels but these requirements are very specific even to the thickness of the wood itself and will only be allowed in accordance with Florida Statutes . All shutters and mitigative measures will need to have been installed by the 2009 policy effective date. This legislation (House Bill# 7057) is state-wide and therefore will include all Florida counties.
As far as the effects on the real estate process, these requirements will no doubt upset those policy holders who are forced to use Citizens Property Insurance Company but who feel that their property is safe from potential storm damage and wind-borne debris. Clients seeking coverage outside of Citizens may be able to find coverage by using the Florida Marketing Assistance Plan (www.FMAP.org). There they may be able to find agents writing insurance in their area. Also they may choose a non-admitted or surplus lines carrier such as Lloyds of London.

Wind-borne Debris Region Map
http://www.dca.state.fl.us/FBC/maps/Wind_borne_MAP021407v2.pdf