Gov. Ron DeSantis’ office confirmed that State Farm Insurance plans to continue its presence in the Florida insurance marketplace after Farmers Insurance declared plans to leave the state.
State Farm spokesperson Roszell Gadson told NewsNation in a statement that the company plans to commit to “responsible growth” to “deliver promises” to customers.
We are encouraged by the recent insurance reforms and efforts to curb legal system abuse and we will continue to work constructively with the Florida Legislature and the Office of Insurance Regulation to improve the marketplace on behalf of our Florida customers,” Gadson said.
Farmers Insurance reportedly announced this week its plans to pull out of certain home policies in Florida, citing “concerns of extreme weather and hurricanes as a major risk in the property insurance market.”
Last week, the insurance company informed the state that they would be “pulling several home, auto, and umbrella policies out of Florida.” The move is expected to impact 100,000 policy holders.
DeSantis was asked about what is being done to address the unstable insurance market in Florida during an interview on The Howie Carr Show Wednesday.
The governor said the insurance crisis had been a decade-long issues before he was governor, highlighting how previous storms caused companies to leave the market.
Housing insurance carriers leaving the market have led to skyrocketing prices, which lawmakers have passed legislation in an attempt to address during regular and special sessions within about a year.
The state legislature has attempted to combat the rising premiums and costs by implementing insurer-friendly policies that are meant to incentivize companies to stay and do business with Florida residents. Part of the legislation included eliminating one-way attorney fees in an effort to get rid of those “frivolous” lawsuits.
“What’s going to happen is because we did those reforms, it now is more economical for companies to come in,” DeSantis said. “I think they’re going to wait through this hurricane season and then I think they’re going to be willing to deploy more capital to Florida.”
The governor noted that Florida has a “challenging market” following borderline category 5 Hurricane Ian in 2022 being one of the “costliest storms in recent history.”
“I think we’ve had problems with our legal infrastructure that we have addressed,” he said. “We did a big reform with that and the My Safe Florida Home Program, so knock on wood we won’t have a big storm this summer. Then I think you’re going to start to see companies see an advantage.”
Following Farmers Insurance’s announcement, Florida House Democrat Leader Fentrice Driskell, D-Tampa, said it shows Republicans’ efforts have not solved the insurance crisis.
“Instead of providing real relief and a strong market, insurance companies got $3 billion of our tax dollars as reinsurance aid, and a new law making it harder to hold them accountable in court,” Driskell said. “Policy holders will now scramble to find a company that will cover them, and I doubt many families will end up paying less than before. Despite the promises, we’re moving in the wrong direction.”
However, House Speaker Paul Renner, R-Palm Coast, said the company’s decision to pull out was not based on the impacts of recent reforms to stabilize the state’s insurance market, “but the company’s financials.”
Renner said while the reforms will “take time to take effect,” he believes they “put the right systems in place to strengthen our insurance market and provide Floridians with the access to coverage and peace of mind they need for their property.”