California’s unenviable insurance climate has come under scrutiny once again, this time due to the recent wildfires that have engulfed Los Angeles, leaving at least 10 people dead and over 100,000 evacuated. State Farm, one of the largest insurance companies in the US, is facing backlash from celebrities and ordinary Californians who have had their home insurance policies canceled.
Rob Schneider, a Deuce Bigalow star, recently took to Twitter to express his frustration with State Farm’s decision to cancel over 72,000 policies in California, nearly half of which were for home insurance. Schneider tweeted, “F# K You @statefarm Screw You And All Your Phoney Commercials!! You Are A Pile Of Crap For Canceling Insurance Policies Of Californians!”
The issue is not new, however. Since 2020, insurers have canceled over 2.8 million home coverage policies in California, including more than 530,000 in Los Angeles County. The reasons behind this exodus are rooted in a 36-year-old regulation called Proposition 103, which requires insurance companies to ask permission from the state government agency before raising premiums.
Proposition 103 was passed in 1988 and aims to limit insurance rates, but it has been met with resistance from the insurance industry. Insurers argue that the premium increase approvals from the state are too slow, and that they cannot afford to offer coverage for Californians.
The issue is further complicated by the fact that California’s regulations do not allow insurers to use technology like credit scores for drivers and risk modeling for homes, which makes it difficult for them to provide accurate pricing for their customers. This has led many insurers to opt out of offering policies in the state altogether.
As the insurance industry continues to flee California, homeowners are left with limited options and are struggling to come to terms with the reality of their situation. However, there is hope on the horizon. The Federal Emergency Management Agency (FEMA) has approved major disaster assistance for affected regions, which includes grants for temporary housing and home repairs.
In light of this news, it’s essential for homeowners to take action and seek alternative insurance options. If your insurer wants to discontinue your policy or raise your premiums, they should inform you at least a month before your policy’s renewal date. You can also ask your insurance company to reconsider, and have an insurance agent review your file to undo your cancellation.
Source: https://www.yahoo.com/news/rob-schneider-blasts-state-farms-114400304.html