The State Farm wins the first of its kind increased rates in California

From LevagsCalmness

This story was originally published by CalmattersS Register about their ballots.

The state farm can bring together the homeowner and other prices from next month, becoming the first insurance company to win approval to make it an emergency intermediate basis in California.

The largest insurer in the country made the unprecedented request To raise emergency rates this year, after he said he was in financial difficulties and was expecting claims over $ 7 billion because of the fires of Los Angeles County in January.

The staff of the State Insurance Department recommended the approval of the company’s request, but the insurance commissioner Ricardo Lara asked the company more information about his finance. He also asked if the insurer could contact his mother company, Mutual State Farm, for help. Lara then conditionally approved But the official decision of a judge who led a three -day hearing Last month, examine the proposed agreement between the department and the insurer.

“Adopted as a whole, it represents a fundamentally fair, adequate and necessary measure-effectively functions as a rescue mission to stabilize the financial status of the state farm, while protecting policies,” writes Karl-Frandrick Seligman, the Judge of Administrative Law, in A in A Decision of 38 pages published todayS

The decision means that the state farm can raise its prices on average 17% for homeowners, 15% for tenants and condominium and 38% for rent housing starting from June 1.

Approval comes in spite of calls on the insurance department to investigate Complaints of the processing of casualties by victims of fires in the region of the state farm. These survivors and the legislators who represent them called on Lara to reject the company’s request to raise its prices, but the commissioner They told the survivors of a fire At the ZOOM meeting over the weekend, raising rates and complaints about claims were separate questions.

In his decision, the judge addressed the possibility of this first approval to pave the path of other insurance companies to request emergency intermediate increases after other major fires. Seligman has mentioned that the state farm will still be required to prove more fully on the initial applications for raising the rates, which were filed last year, which will be considered at a full-fledged hearing next month.

“A full percentage hearing serves as a critical signal for the market that requests for emergency percentages of the type of state farm have advanced serious (s) will undergo strict control,” the judge wrote.

The State Farm has promised to provide the restoration of persons to policies if, after hearing the full percentage, the approved rates are lower than the intermediate rates.

State Farm wrote in his brief information after hearing that approval of his request for a rate is vital to his financial power. The insurer stated that his financial situation has led to several lower loan decreases and is trying to avoid additional decreases that could endanger the insurance policies of more than 1 million homeowners in California.

Providing the state farm the increase in interest rates was in the best interest of the consumers of the state, as this helps to maintain the insurance available, reading the insurance department after the hearing.

The consumer guard, the advocacy group, which objected to the intermediate increases in tariffs, wrote in his information after hearing that the state farm failed to prove that the increases were acting justified.

This is a developing story and will be updated.

This article was Originally Published on CalMatters and was reissued under Creative Commons Attribution-Noncommercial-Noderivatives License.