The insurer is withdrawing its coverage from the state, dropping all of the lines of business under its own name.
A company spokesperson from Farmers has made insurance news by announcing that the insurer would be dropping its homeowners and its auto policies within Louisiana, making a complete exit from the state under its name.
That said, it will still be retaining the policies that it has sold under the names of its three other brands.
The insurance news being made by Farmers involves dropping the lines of business that include approximately 23,000 homeowners policies and 7,000 auto policies within Louisiana. The over 100,000 policies sold under the brand names will not be dropped.
The Commissioner in the state released an insurance news statement regarding the exit of Farmers.
Jim Donelon, the Commissioner in Louisiana, explained in his insurance news announcement that the company had been experiencing notable losses and that this was the reason that it would be withdrawing from the homeowners and auto coverage marketplace in the state.
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Donelon explained that “I am totally confident, and I told them this when we met last month, that we can readily find places for their policyholders with other companies looking for business in our homeowner’s market.”
Farmers had previously made insurance news in Louisiana when it failed to raise its rates for homeowners policies on two separate occasions. In 2010 it proposed an average increase of 18.3 percent across the state for the 30,728 homeowners for whom it was providing coverage. Then again in 2012, it attempted to boost its rates by an average of 39 percent for over 25,560 customers.
Both of those were denied by that state’s Insurance Department. According to the latest insurance news, the insurer will no longer be renewing its current policies as of April 27, which means that by that same day in 2014, the company will have entirely removed itself from Louisiana under that name. Donelon explained that this represents approximately 2.5 percent of the current homeowners market which will be stepping out of the state. In terms of auto coverage, it is an exceptionally small amount of business in a market with considerable competition.