State Farm Florida Insurance Company

(a subsidiary of State Farm Mutual Insurance Company)

About State Farm Florida Insurance Company

State Farm Florida Facts as of 3/17/09  

One in four Florida households has a State Farm product, including 2.8 million State Farm auto insurance policies.

More than 10,000 State Farm associates live and work in Florida:

  • 826 agents
  • 4,479 agent team members
  • 4,801 employees

 State Farm handles an average of 821,000 claims for Florida customers per year: 

  • $577 million paid in property claims (homeowners and related lines) in 2008
  • $1.7 billion paid in auto claims to Florida drivers in 2008 

State Farm invested $3 million in Florida communities in 2008, plus priceless hours of service:

  • $805,000 in 2008 Good Neighbor Citizenship support to communities.
  • $180,000 for outreach to the Hispanic community.
  • $722,000 for 2009 State Farm Youth Advisory Board grants in Florida.
  • $1,345,000 for 2009 Road Ranger/State Farm Safety Patrol sponsorship.
  • Nearly 5,000 hours of community volunteer service in2008 by State Farm employees, agents and agent team members in Florida.

State Farm invests in Florida’s infrastructure and supports Florida’s economy:

  • $1.27 billion in municipal bond holdings by yearend 2008, including:
    • $490 million for general state bonds
    • $110 million for cities and counties
    • $50 million for community development
    • $10 million for higher education.
  • $27 million premium taxes paid in 2008.
  • $660,000 property taxes paid in 2008.
$166 million to Florida vendors and service providers in 2008.


History of State Farm Florida/Backgrounder

State Farm Florida Insurance Company was licensed to do business in the state in Dec. 1998, and wrote its first policy in Feb. 1999.

A subsidiary of State Farm Mutual, State Farm Florida was created as a stand-alone company designed to handle the substantial risk presented by Florida’s hurricane-prone coast.

State Farm Florida was formed:

  • To ensure that policyholders in other areas of the country would not subsidize risks unique to Florida.
    • State Farm Mutual (State Farm Florida’s parent company) has obligations to policyholders across the country. No state regulator will allow his or her policyholders to subsidize policyholders in other states. For example, we are not allowed to charge Floridians for wildfires in California or tornadoes in Oklahoma, nor can we charge those customers for hurricane losses in Florida.
  • To charge rates in Florida that are commensurate with the risks presented in that state.
    • In a catastrophe-prone state like Florida, rates must be adequate to both a) cover losses and expenses expected in “normal” years, and b) establish and add significantly to surplus for the inevitable hurricanes. State Farm Florida’s current rates are not adequate for either purpose.

State Farm Florida’s current financial situation

Faced with steeply declining resources to cover future claims and expenses, State Farm Florida has little choice but to discontinue its property insurance products while it is still able to honor its obligations.

Since 2000, State Farm Florida has paid out $1.21 in claims and expenses for every $1 of premium income received, totaling $1.4 billion more in claims and expenses than it has collected in premiums. Since Jan. 2008, State Farm Florida’s surplus decreased from $820 million to $621 million.

State Farm Florida’s Third Quarter Financial Results

In November, 2008, State Farm Florida reported its third-quarter operating results to the Florida Office of Insurance Regulation (OIR).

The publicly-filed report shows a loss of $198.6 million for the first three quarters of the year and a decline of nearly $202 million in State Farm Florida’s surplus – and that’s without a major storm. State Farm Florida experienced a $217 million underwriting loss for the first three quarters of 2008 that compares to an underwriting loss of only $13 million through the same time period last year. Other significant results were:

  • Earned premium decreased $156 million due to a state-mandated expansion of Windstorm Mitigation Program discounts and a decrease of policies in force.
  • Non-catastrophe losses increased $89 million (29.7 percent) and catastrophe losses increased $34 million (106.4 percent), primarily due to losses incurred after Tropical Storm Fay.
  • The underwriting loss combined with earned investment income and other income resulted in a pre-tax operating loss of $300 million.

 

Public Hearings and Documents

 

Contact Us

Contact us by phone:

Contact your State Farm agent or call us directly at 1-800-381-3963.

Contact us by email:

To send us an email, click here

Contact us by mail:

Jacksonville Operations Center
8001 Baymeadows Way
Jacksonville, FL 32256-7521

Winter Haven Operations Center
7401 Cypress Gardens Blvd.
Winter Haven, FL 33888-0007