State Farm has requested a 6.9% homeowner rate increase in California, but the request is anything but a slam-dunk as 2 well-heeled consumer organizations move to oppose the increase, calling it exorbitant.
In fact, the groups, Consumer Watchdog and Consumer Federation of California, not only want to stop the rate increase, they want State Farm’s rates to be rolled back by about 12%.
“We believe the evidence will convince the Department of Insurance that instead of approving a rate hike, it should order State Farm to reduce the amount it charges 1.7 million Californians for homeowners insurance,” said Richard Holober, executive director of the Consumer Federation of California.
Consumer Watchdog led the campaign to pass California’s Proposition 103 in 1988, which requires the California Department of Insurance to approve rate increases. It also requires insurance companies to open their books to public scrutiny when they ask for a rate increase, and it enables consumers or consumer groups to initiate a process to review rate increases.
According to information on the Department’s website, implementation of Proposition 103 has saved California consumers billions of dollars.
A decision is not expected until after Thanksgiving.
