The three largest home insurers in Texas have successfully imposed marked rate hikes on numerous policyholders despite the protests of a state consumer advocate. Furthermore, Texas' insurance commissioner, Julia Rathgeber, has been conspicuously taciturn about the issue, and seeming ever more likely to take no action on the matter as she first learned of the increases in late 2013. To date, Rathgeber's office has only released a statement saying that the increases from Farmers, State Farm and Allstate are still under review while they've been active since the beginning of this year.
The three companies, with a combined 2 million customers in the state, have increased their fees at disparate rates. Farmers augmented its fees by an average of 14.9 percent while Allstate's increases averaged 6.5 percent. State Farm customers have experienced the most significant hikes, enduring a 10 percent increase this year which follows a 20 percent increase from 2013. The trio of organizations cited the state's destructive weather patterns, particularly the frequent hailstorms, as the impetus for the price increases.
Patti Kelly, a spokeswoman for State Farm, cited the fee changes as commensurate with housing conditions in Texas, noting that the company was now spending $1.11 for every dollar collected in premiums to meet claims and other operating expenses.
Conversely, Public Insurance Counsel Deeia Beck objected to the motives of all three organizations, telling Dallas News that State Farm's new rates are based on predictions that "exaggerate future expected losses" and that Farmers is attempting to win "greatly excessive" profits.
"The rate increases do not meet legal guidelines under the Texas Insurance Code. I had thought that we would hear something [from the commissioner] by now," Beck adds, while noting that she filed documents protesting the increases in January.
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