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farmers insurance
Farmers Insurance Quits Covering Florida Property as Climate Crisis Worsens
"As Farmers Insurance exits Florida due to concerns over increasing risk from severe weather, the insurance industry continues to prop up the fossil fuel industry," one expert noted.
Jul 12, 2023
In a move the will affect roughly 100,000 policyholders, Farmers Insurance announced Tuesday that it would stop covering property in Florida, a business decision the company said was taken to "effectively manage risk exposure" amid increasingly frequent extreme weather disasters fueled by human-caused global heating.
Farmers informed Florida officials that it would no longer write new home, auto, or umbrella policies in the state, making the company the fourth insurance giant to quit the Florida market over the past year, according to the Tampa Bay Times.
Some of the companies have cited rising risks from hurricanes as their main reason for leaving. A study published earlier this year showed how rapid sea-level rise in the southern U.S.—which is happening faster than scientists previously understood—is intensifying hurricane damage in coastal cities.
The administration of Florida Gov. Ron DeSantis—a struggling 2024 Republican presidential contender who said in May that he rejects the "politicization of the weather"—and the GOP-controlled state Legislature worked hard but ultimately failed to convince Farmers to keep doing new business in the state.
"Florida's leaders have stepped up to the plate by delivering historic reforms to Florida's property insurance market to ensure competitiveness and increase consumer choice," wrote state Insurance Commissioner Michael Yaworsky.
The Sunshine State's insurance market has struggled since Hurricane Andrew devastated a large swath of southeastern Florida in 1992.
According toThe Associated Press:
At the end of 2022, average annual property insurance premiums had risen to more than $4,200 in Florida, which is triple the national average. About 12% of homeowners in the state didn't have property insurance, compared with the national average of 5%, according to the Insurance Information Institute, a research organization funded by the insurance industry. At least six insurers went insolvent in Florida last year.
Carly Fabian of the consumer rights group Public Citizen noted in a statement Wednesday that "as Farmers Insurance exits Florida due to concerns over increasing risk from severe weather, the insurance industry continues to prop up the fossil fuel industry."
"Farmers has held significant investments in fossil fuel companies, and its parent company, Zurich, remains a top global insurer of oil and gas," she noted.
"Insurers pulling out of vulnerable markets continue to prioritize fossil fuels over homeowners and auto insurance policyholders, creating a crisis," Fabian continued. "This is reckless behavior by an industry that the public will be increasingly reliant on as the climate crisis intensifies."
"Regulators must push insurers to mitigate climate-related risks by reducing the industry's financing and insurance of the fossil fuel industry," she added. "Florida regulators and elected officials continue to stick their heads in the sand by criticizing financial firms who move away from fossil fuels."
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