Regulator regulator approval to increase the California insurance tariff

The largest insurer in California should know within a few weeks whether he can gather premiums for nearly 3 million policies in the state after making his case at a meeting with the insurance commissioner Ricardo Lara today.

In comments after the closed -door meeting, Lara said she would carefully consider the request he had previously rejected. He promised a solution within two weeks

The State Farm General – the State Part of the National Group for State Farms – was earlier to increase the premiums of housing owners on average 22% on an intermediate base outside the usual approval process under the California insurance law. He wants to bypass the hearing, which would usually be required, stating that he was waiting for the insurance department to approve the increases of the interest they requested last year and that the payments from the fires in Los Angeles County had worsened his financial situation.

In the request made in early February, the company said it wanted to start charging customers the “emergency” increases in May. Lara rejected the request Against the recommendation of his employees on February 14, saying that he needs more information and called for the best leaders of the company to appear before him.

Today’s meeting at the offices of Oakland at Lara’s insurance department lasted for about an hour and a half. It was attended by a department, a state farm and a consumer guard, a advocacy group that called on the Commissioner to reject the temporary increases in tariffs ,.

At a press conference after the closed door meeting, the commissioner said he would consider the company’s data, asked for more information if he needed it and wanted to “do this” at least two weeks from now.

“I want users to understand why I made a decision,” he said.

State farm executives said in a letter to Lara on February 25, that the company has so far paid $ 1.75 billion at about $ 9,500 and expects about $ 7.6 billion in total payments with the claim. The company estimates that its surplus has decreased by $ 1.04 billion at the end of 2024 to about $ 400 million after LA fires.

“This is an unfortunate circumstance for our customers and all Californians, and only worsens the SFG financial situation and the related internal and external measures for financial force and an estimated ability to pay claims from what they were last June,” the company wrote.

According to a proposal 103, the law approved by the voters regulates the insurance in the state, insurance companies seeking an increase of the rates of 7% and above, are subject to hearing if interventional sites. The consumer guard intervened in State Farm rates last year and objects to the company’s request for intermediate increases now.

The response to the consumer guard to the letter from the State Farm is indicated ˜: “The provision of an” emergency intermediate increase “in these circumstances will determine a dangerous precedent, effectively allowing insurers to circumvent the previous requirements of the proposal 103.”

The meeting today was not a formal hearing; Lara characterizes it as an “informal meeting”.

In an interview with CalMatters after the meeting, the consumer guardian lawyers said the state farm for financial information had provided in her letter, as well as at the meeting, not enough. They expressed the hope that the commissioner seemed open to bringing the issue to hearing, as required by law.

“We need the basic data” behind the numbers that the company has publicly released, said Ben Armstrong, the Consumer Actuer.

The State Farm has not responded to a request for comment.