September 26, 2002
|For more information call:
Rod Bordelon, Public Counsel
An Open Letter to Farmers Homeowners Policyholders
By now, you have heard that Farmers Insurance Co. recently announced it will no longer sell homeowners insurance policies in Texas and will begin non-renewing all of its policies beginning in November. Farmers action comes after repeated attempts by the Texas Department of Insurance (TDI) to bring the company into compliance with the law. TDI recently found that Farmers was engaging in illegal and deceptive practices and ordered the company to eliminate those practices. Farmers has refused to do so.
Like many companies, Farmers has paid millions of dollars in losses in recent months, but like many companies Farmers has also earned millions of dollars in past years when losses were lower and would no doubt have earned millions more in future months when losses decline. This is not about losses; this is about complying with the law.
You will soon be receiving a notice from Farmers of their intent to non-renew your policy. By state law, you have at least 30 days from this notice to find coverage with another insurance company. Your coverage with Farmers will continue in effect until the expiration date on your policy. You should not delay your search for a new policy since you may need to contact several companies and agents in order to obtain coverage. It is a tight market, but make no mistake, there are many companies writing homeowners insurance in Texas and they have more than enough financial capacity to cover any losses.
To assist in your search, the TDI offers assistance through a new web site and toll free phone line at 1-866-695-6873 andwww.helpinsure.com. TDI's new program matches homeowners' insurance needs with insurance providers and independent agents who are selling homeowners policies.
The decision to leave Texas was Farmers' alone. Farmers had a choice: to do business legally or not do business at all. Farmers chose the latter.
The Texas Office of Public Insurance Counsel (OPIC) is a state agency that represents the interests of consumers in insurance matters. My office will continue to do everything we can to provide options for consumers like you and encourage responsible insurance companies to fill the void left behind by Farmers. If you have any questions regarding your options, please contact the TDI at the number and web site listed above, or contact my office at www.opic.state.tx.us.