State Farm:Hard row to hoe

By Staff
Dec. 22, 2002
State Farm, which writes almost a third of the homeowners insurance policies written in this state, has a tough task convincing Mississippians that premium increases of up to 79 percent are essential to the company's financial success. A public forum on what is likely to become an official request for a rate increase raised new questions about the impact of such a shocking hike.
We learned that the information State Farm previously announced about possibly seeking a 42.5 percent increase was not entirely accurate. Under its own mathematical model, the company's rate increases could skyrocket as high as 79 percent in what it considers disaster-prone areas of the Coast south of Highway 90. The company says that's the only way it can even break even on homeowners insurance.
State Insurance Commissioner George Dale has the authority to approve the rate request, presuming one is filed. Our prediction is that such a rate increase will be a hard sell, even in hard-pressed Mississippi.