State Farm Gets Rate Increases in Louisiana

Beginning June 15, State Farm homeowner policyholders in Louisiana will face a 12.2 percent rate increase averaging about $100 more per year. According to the New Orleans Times Picayune, the Louisiana Insurance Rating Commission voted 3-2 to accept State Farm’s new rates.

The seven-member commission is authorized to approve and reject insurance rate increases in the state. One commissioner was not present for the vote and Insurance Commissioner Robert Wooley votes only in case of a tie.

State Farm estimates it will receive an extra $27.3 million in several lines of residential insurance, including policies for homeowners, farmers and ranchers and apartment renters as a result of the increase.

The company originally sought a $76.3 million overall increase, including $65 million on homeowners policies. Facing opposition, it reduced that request.

Around 263,000 Louisiana homeowners, which now pay an average of $720 a year in premiums, will face an average increase of $100.

Also approved were State Farm’s average rate increases of:
· 20 percent, or $1.8 million, for the 17,000 homeowners who live in manufactured homes.
· 7.2 percent, or $1.7 million, in homeowners insurance for condominium owners and apartment and condo renters. It has about 27,000 renters and condo owners, a little less than 10 percent of the 290,000 homeowners it insures in the state.
· 14.9 percent, or a $500,000 increase, for farm and ranch owners. The company insures about 2,600 farms in the state.

While State Farm currently has a moratorium on writing new homeowners policies in Louisiana, it does write policies for existing customers in the state, customers who move to Louisiana from elsewhere and for current insureds who build new homes or remodel existing ones. It has about 35 percent of the homeowners market in the state.

Topics Trends Louisiana Pricing Trends Homeowners