State Farm’s mistreatment of its policyholders has finally come to a head. The insurance giant has agreed to reduce the rates for its Rental Dwelling Program starting in 2017 after a long discussion with the California-based organization known as Consumer Watchdog and California’s Department of Insurance.
A while back we reported on State Farm being confronted by the non-profit organization Consumer Watchdog and the Department of Insurance after trying to raise their rates by about 7%. One of the Judges called to the case – John Larsen – suggested that State Farm not only refund their policyholders, but also reduce their rates for their renter’s insurance.
It seems as if State Farm has conceded to at least one of the suggestions. According to Dave Jones, the Insurance Commissioner who was part of the case against State Farm, the insurance giant has decided to reduce the rates for their Rental Dwelling Program throughout California by “an average of 40 percent”. This should be in effect by February 1st of 2017.
This positive change affects about 200,000 people who already have a State Farm Rental Dwelling Program policy. The effects of this reduction will apply to numerous types of policies including: “homeowners, auto, and other property and casualty insurance” and will change depending on the location of the property with the Rental Dwelling policy. Risk characteristics and coverage features will also affect this reduction.
Moneywise, policyholders are looking at a total average savings of $359 per year, says consumerwatchdog.org. The linked article also goes into the positive changes Dave Jones has made since his appointment in 2011, these include:
- QBE reduced lender-placed homeowner rates by 35 percent.
- American Assurance Insurance Co. reduced lender-placed homeowner rates by 30.5 percent.
- American Modern Home reduced lender-placed homeowner rates by 21.3 percent.
- Great American Assurance Co. reduced lender-placed homeowner rates by 28 percent.
- Pacific Specialty Insurance reduced homeowner rates by 21.5 percent.
- California Casualty Indemnity reduced automobile rates by 21.7 percent.
- USAA General Indemnity reduced automobile rates by 20 percent.
What do you think? Is this is a definitive positive step int he right direction or will State Farm try to weasel their way out of the other suggestions from Larsen?