Another property insurer is dropping coverage in Florida.
Farmers Insurance will stop writing new business and not renew its existing “Farmers-branded” automobile, home and umbrella policies in the Sunshine State, the company said Tuesday.
Last month, Farmers said it was only pausing new business in Florida. The company is also limiting new home policies in California, where it is based, according to news reports.
“This business decision was necessary to effectively manage risk exposure,” the company said in a statement.
The move will impact 30% of the company’s business in Florida, or roughly 100,000 policies. Policyholders affected by the decision will be given notice that their coverage will not be renewed.
Policies under other Farmers brand names won’t be affected
Policies under its other brands such as Bristol West, Foremost Signature, Farmers GroupSelect, Foremost Choice and Foremost-branded policies will not be affected.
This marks the latest stumble into instability for Florida’s property insurance market. Seven Florida property insurers were declared insolvent in the past 18 months, and another 15 have stopped writing new business in the same time period, said Mark Friedlander, spokesperson for the Insurance Information Institute.
Farmers joined Bankers Insurance, Centauri Insurance and Lexington Insurance, a subsidiary of AIG, to have withdrawn from the market since last year, he added.
Meanwhile, state-run Citizens Property Insurance continues to grow, with 1.3 million policies as of the end of May.
State lawmakers attempted to address the crisis with two special sessions last year and the most recent regular session. This included stopping one-way attorney fees and prohibiting third parties such as roofers or contractors from being paid directly by insurance companies.