Farmers Insurance pulls out of Florida. Should Utahns be worried?
Jul 17, 2023, 7:00 PM
SALT LAKE CITY — Citing hurricane risk, Farmers Insurance will no longer offer auto, home or other policies under its main brand in Florida.
“They’re just the first to go, that’s my reaction,” KSL NewsRadio’s Dave Noriega said. “They’re the first ones to leave. I would imagine every other insurance company is lining up and saying ‘Great, we’re out too’.”
Should Utahns have similar concerns? Utah Insurance Commissioner Jon Pike joins KSL NewsRadio to discuss the insurance trends that are taking shape in California and Florida.
Right off the bat, Pike is asked if homeowners are required to have their homes insured.
“No, you’re not,” he said. “However, if you have a mortgage, most likely your mortgage company is going to require that you have it, right? That’s what the reality is for most people. But if you don’t have a mortgage, it would be up to you.”
Pike says it would be a significant problem if all insurance companies pulled out of a certain area such as California or Florida.
“If there’s a piece of good news right now,” Pike said. “It’s that that hasn’t happened anywhere yet, including in California and Florida.”
Without Farmers Insurance, there are plenty of other choices
For those people in California and Florida, who have had the rug pulled out from underneath them, Pike says they still have a lot of other options available.
He says he has heard some reports that some insurance companies may not want to renew or sell policies in certain parts of Utah that are at greater risk for wildfires.
“They can do that,” he said. “They’ve got to go through approved processes for canceling or not renewing.”
However, it gets a bit trickier for insurance companies if they want to pull out of the state, according to Pike.
“But if they want to pull out of the state all together,” he said. “There’s what’s called an orderly withdrawal process that they have to go through. And they have to be able to place those policies with another carrier.”
However, Pike says it would take a “huge catastrophic” or “a series of events” for people not to have options. Instead, he says what’s likely to happen sooner is insurance options will be reduced.
Pike is asked what homeowners should do to ensure they are on solid ground with their insurance company.
“They might want to call them,” he said. “They want to be more proactive, and say ‘What are your intents, your intentions in Utah?'”
Dave & Dujanovic can be heard weekdays from 9 a.m. to noon. on KSL NewsRadio. Users can find the show on the KSL NewsRadio website and app, as well as Apple Podcasts and Google Play.
Read more:
- State Farm Insurance pulls out of California because of catastrophes and increasing costs
- Insurance companies eyeing climate change when considering risks, costs
