State Farm

The regulations are designed to address long-term solvency concerns.

State Farm is under investigation as its premiums have been rising “drastically".

IBHS CEO Roy Wright says insurers need a comprehensive approach to resilience.

Roughly half a year since the LA fires, brokers said there’s hope things are turning around.

The class can collectively challenge State Farm’s property claims calculations.

The ruling comes as insurers face growing legal pressures following the January blazes.

Lara approved an interim rate increase for the company just weeks ago.

The company seeks the full 30% homeowners’ rate request it made last June.

State Farm will need to provide its CA subsidiary with a $400mn surplus note.

The carrier has received 12,300 claims as of 28 March.

Commissioner Lara also proposed a $500mn cash infusion from parent State Farm.

The carrier has also received 11,750 fire-related claims so far this year.

The company is seeking an emergency rate increase after the devastating Los Angeles wildfires.

State Farm General has asked California regulators for an emergency rate increase.

The carrier has paid $1.75bn on around 9,500 claims filed from the wildfires.

Sources said California regulators need to show they’re receptive to private insurer needs.

The insurer is seeking a 22% interim raise, but the request is currently on hold.

The insurance commissioner said the carrier has not shown the need for price increases.

The insurer disclosed the estimates as it seeks emergency rate hikes from regulators.

The company says the recent wildfires will be the costliest in its history.

The carrier has around $2.5bn-$4bn of reinsurance cover specifically for California risk.

The company received over 10,100 home and auto claims as of January 27.

A state-mandated, one-year moratorium on non-renewals is also in place.

Insurers are fighting to recoup claims they have paid out.

Independent litigation threatened a $4bn settlement with wildfire victims.

The victims claim insurers shouldn’t get settlement cash before they’re made whole.

The discrepancy between rising claim counts and favorable reserves is cause for concern.

Mutuals struggle to react and adapt to a worsening loss environment.

The downgrade reflects the company’s balance sheet strength, which AM Best assessed as weak.

The carrier stopped accepting new HO business in the state last May.

Farney will take over as CEO on June 1.

Personal lines rate filings are rising, even as some inflation drivers slow.

Increased cat losses in property offset auto improvements.

Cooling CPI metrics and improving loss ratios indicate a positive shift for the personal auto industry, but results are not yet back to where they need to be.

Personal auto carriers risk falling behind in the battle between loss costs and approved rate declines, while homeowners carriers’ double-digit filings might not be enough to keep up.

Inside P&C’s morning summary of the key stories to get you up to speed fast.

Carriers have been dealing with elevated storm activity this year, whilst additional purchases to match inflating values had largely been parked in 2023.

This is the second downgrade faced by State Farm and its subsidiaries from AM Best in the last month.

The ratings agency affirmed its financial strength rating of A++ and long-term ICR of aa+ on the mutual and its affiliates.

Differing trends in short- and long-tail lines offset each other to create a net positive for the industry, though the releases are slowing significantly.

Inside P&C’s news team runs you through the key highlights of the week.

An uneven loss environment in personal lines calls for a cautious reading of reserves.

Need to Know

California Insurance Commissioner Ricardo Lara was speaking about climate change's impact on insurance pricing at the Bermuda Climate Summit.

CPI figures show loss costs are cooling, and if rate levels cannot reach adequacy we are likely to see more pausing from the industry beyond State Farm, Allstate and Nationwide.

Inside P&C’s morning summary of the key stories to get you up to speed fast.

Other carriers reportedly pulling back from writing business in California recently include Mercury General and Safeco, while Oregon Mutual is said to have exited the California market altogether.

Continuing rises in loss frequency and severity plus a difficult regulatory framework make the situation in California highly challenging for carriers.