State Farm has announced that it will no longer be offering insurance coverage to churches in Florida. The company’s exit from the market leaves hundreds of churches throughout the state looking for new insurance companies. The move is part of the company’s desire to focus more on the property market in the state, a plan that sees the insurer pulling out of other markets in the coming years. The insurer has not released estimates of how many churches will be affected by the decision, but has said that at least 500 churches in North Florida will have to find policies elsewhere.
Florida’s insurance market is in a constant state of flux. At times, insurers do their best to avoid the state because of the massive risk presented by hurricanes and floods. This risk also brings opportunity for growth, however, as premiums in the state are often quite high to compensate for the high risk. Insuring churches introduces a new sleuth of risks, especially for those that function as day care centers and schools. These risks add to the overall cost of writing policies in the state.
The insurer is not singling out churches when it comes to discontinuing coverage. Earlier this year, the company placed more than 10,000 homeowner’s policies on non-renewable status. The company has also stopped writing policies for apartments and contractors working in the state. Meanwhile, the company has raised the rate for homeowners insurance by an average of 18% statewide.