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State Farm to seek rate hike in Mississippi

JACKSON — State Farm will file a rate increase with Mississippi Insurance Commissioner Mike Chaney in the next few months.

Company spokesman David Majors tells The Clarion-Ledger that details are still being worked out.

Last year, State Farm boosted rates by an average of 19.5 percent in Mississippi’s three coastal counties: Harrison, Hancock and Jackson. The company was seeking a 45 percent increase.

And while State Farm, the state’s largest insurer, said it has paid out much of its Hurricane Katrina-related claims and resolved most of the legal disputes over whether wind or water caused damage to a particular property, the company still faces a lot of risk in insuring homes and other property along the coast, said Steve Simkins, State Farm’s chief counsel in Mississippi.

Simkins says State Farm has paid more than $2 billion in Katrina-related claims since 2005.

"We’re not coming in and asking for what we’ve lost. We found out we have more exposure to a major storm," he said.

Chaney said he won’t approve it or any other proposed rate hikes until at least a year after a company’s last increase took effect and won’t approve any hikes during hurricane season, which runs June 1 through Nov. 30.

Chaney said he will look over whatever State Farm requests to see if it is reasonable.

It’s been nearly five years since Katrina battered the Gulf Coast, and State Farm has yet to resume writing new homeowner policies in the three coastal counties, although it is renewing policies in those areas.

Another company seeking a rate increase is Allstate, which is seeking a 44 percent rate hike statewide.

Chaney in 2009 rejected a proposed 65 percent increase in Allstate’s home insurance rates throughout Mississippi, saying it was simply too much. The company was left to file a new request for a lower increase.

Allstate has said a rate increase is needed because of a growing number of claims by Mississippi customers from fires, break-ins, water damage and liability.

About Megan Wright

4 comments

  1. Prentis Goodwin

    With small business having nowhere to turn for funding in this country along with the ever rising cost of doing business one must set aside 40% of the total earnings for inflation due to government decisions made in Washington by our so called leaders of this great country. Big insurance companies like State Farm have had there time in office with billions to there credit whats the problem? can they not find ways to cut back like the rest of us have had to do? I lost my home over ten years ago to a fire I pray no one ever has to go through that ever. We lost everything my insurance company was State Farm it took all together Eight years for them to pay me and as soon as my home burned they canceled my homeowners insurance insurance and told me they would never insure me again even tho it was not my fault my home burned. I made many attempts to acquire home owners insurance over the years with State Farm but was always turned down. I had never had a fire before that time, and never till this day after that and I hope I never will. My family lost everything. Maybe it’s a good time for State Farm to through in the towel and get out while they can still get a few cents for there stock. Just in case no one has been looking this country is melting away and fast. I mean we are being made pay super high prices for gas and oil and now here comes a new wave of insurance prices, not to mention here in Mississippi TVA power has went up on there power 18% calling it a surcharge that’s $18 dollars on the hundred that’s a lot of food money that could be spent for a growing child. They can do this because TVA has a corner on the market. I’m asking our state and Washington government just where the heck do you think the people of Mississippi are going to find the Money? What the Oil & Gas prices here we have a government looking the other way while oil is just pouring out into the ocean by the millions of gallons every day! But’ if Bubba changes the oil in his truck himself trying to save a dollar or two and spills a little on the ground here comes EPA with a big fine and possible jail time wake up people. Yea it’s time to vote….

    http://www.authorsden.com/visit/viewarticle.asp?AuthorID=110717&id=49618

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