On September 9, 2008, Florida Insurance Commissioner Kevin McCarty ordered State Farm Florida to issue $120 million in credits or refunds to approximately 98,000 current or former policyholders who did not receive, or who did not apply for, Windstorm Loss Reduction Rating Plan discounts that were available to Windstorm policy holders who made their homes more windstorm resistant. In addition to the credits and refunds, State Farm was ordered to pay a $1 million penalty to the Florida Insurance Regulatory Trust Fund. McCarty’s order followed the Florida Office of Insurance Regulation’s (OIR) July 2008 notice to State Farm that OIR was investigating the company’s implementation of the mitigation discount program.
“I am very pleased that State Farm policyholders will now be getting the appropriate monetary credit for the important wind mitigation devices they put on their homes. Taking steps to fortify our homes against wind damage is very important. Everything Florida consumers can do to reduce storm damage helps to keep property insurance costs down.”
The order also followed the OIR’s notice that it intended to deny the homeowners’ insurance rate increase State Farm requested and the OIR’s refusal to hold a formal hearing on its rate increase denial. For more information, including McCarty’s order and the OIR’s press releases, click here.