State Farm Monster Loss Announced ~Insurance

[JExpedition07]

For those who have been following, insurance groups are losing big on auto and home policies. In 2022 State Farm sold $46 Billion in policies but had $43.7 Billion in claims. Add expenses for overhead and processing claims and they lost $13 Billion. The 2023 earnings were announced and WOW, combined underwriting loss of $14 Billion. If you are a State Farm policy holder, get ready for rate hikes.

https://www.statefarm.com/content/dam/sf-library/en-us/secure/legacy/pdf/2022-annual-report.pdf

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[amschind]

It is much worse than that revenue vs expenses. Most if not all insurers have pretty standard 1985 asset mixes of bonds and securities, and the bloodbath in the bond market has affected insurers even more than pension funds (because pension funds have largely future obligations whereas insurers are getting a constant stream of claims). Bond PRICES are inversely related to bond COUPONS, and the dramatic rise in US interest rates led by the Fed has annihilated bond prices. If you held a bond, or worse still were invested in bonds using leverage, you took solid double digit percentage losses over the past 2 years. So we have about 5 stonks and bitcoin going gangbusters while most securities are flat and bonds are getting destroyed.

I haven't seen Michael Saylor open the Microstrategy Insurance Company yet (if I do, I'll short that too), so basically every other insurer has no choice but to squeeze blood from the stone that is their already hurting customers.

Things aren't good right now.

 

[imnuts]

We got a letter in the mail that our insurer filed for an ~40% rate hike. I'd guess they'll get at least 10-15% approved. It's not one company or one state, though some states and policy types are worse than others.

 

[powerboatr]

Imo
It's not parts .
It's the uninsured amd non licensed drivers
If people that got stopped for no insurance got thier ride impounded until a policy in full was presented to court.
As well as no license and driving.. jail
No excuse. 30 days
Ours went up 600 from last renewal in Oct.
And through some maneuvers I got it lowered 274. Oh geez

 

[HammaMan]

No increases here. We also have a law that impounds uninsured / drivers-license-less operators. The lots / tow drivers are all private companies but require proof of insurance and licensed vehicle owner for release unless they pay for a tow elsewhere. There's also fines paid to the state for related tickets. While there's a lot of shitboxes picked up, there's also new vehicles as well. One of the tag readers catch one of the vehicles, it's getting taken.

Call your state political leaders and demand action. If a department refuses to uphold the laws, go back to state leaders requiring compelled action.

 

[belairbrian]

My son just bought a house and insured it with SF. We knew when he bought it the roof would need to be replaced in the next few years. Never expected underwriting to threaten a cancellation unless he replaced the roof within 2 weeks. Guess their managing risk.

This after we fought with them for two months over totalling out my wifes car. Both drivers were SF, the other made a left turn in front of my wife. Admitted guilt and police report said same thing. They claimed the damage was minor. Both airbags deployed. Found out their adjuster used pictures, never went to see the car.

Finally got it into our body guy (a state farm approved shop) he put the damage at 17,500. Estimate was that the repair would take 4 to 6 months, due to "supply chain issues" so they would be renting us a car for 6 to 8 months. They finally wrote the check.

We've been with SF for 42 years, son 10, and this is how we get treated.
Time to talk to USAA.

 

[Los150]

We had State Farm for ages and we also tried Allstate, then back to SF.
We switched to AAA. Used to pay like $3k for the house and $3k for 3 vehicles. We combined everything with AAA and it was $3500 3 yrs ago for everything. Same coverage. We're at $3800 now. Still a bargain down here.

 

[KTM753]

My Progressive policy (Homeowners, Auto, Umbrella, and Motorcycle) went up 50% total. Rough. Switched to Auto Owners to save 40% of the renewal.

 

[powerboatr]

We have had farm bureau texas since 2010.
Had All-State for ever prior to
Still with all my complaining...they still beat eith service and price all the players

Hamma man..what state are you in

 

[brfertig]

USAA
Cadillac Escalade ESV, Ford F150 XLT, and Toyota Tundra TRD 4x4. With a 17 year old driver. That includes a 1 Million Dollar Umbrella. 450 a month for all that is a steal.
Our 600K dollar home/newly built 20x40 inground pool with a 1 percent deductible and 1 Million Dollar Umbrella.
Policy is 217 a month.
Just cant beat USAA if you are eligible.

 

[Big Dog Daddy]

@imnuts who is your insurer? I just renewed with NJM and it was a pretty sharp increase over my 23 policy.

 

[Bossharp]

In Florida homeowners insurance is getting hard to get at any price. And horriblely expensive when you do.
The dollar is literally being inflated away. I would highly suggest all of yall stock up on food and things you use regularly and seriously consider buying silver (90% US pre 1964 half dollars is the best form) as every Fiat currency has lost its purchasing power.

 

[lawduck1]

Maybe they should not have fired the original Jake….

 

[UGADawg96]

A lot of the issues in FL are due to roofing scams and the state keeping their head in the sand. Roof replacements should be prorated like tire and battery warranties and not full replacement when you lose 10 shingles on a 25yr old roof. It is out of control when roofing companies go door to door convincing homeowners to sign over their rights and then the roofers sue the insurance companies for roof replacement. They pay for the roof since many times it is cheaper than dealing with the lawsuits. And then they say f'it, just raise everyone's rates. Now it is very difficult to get a decent renewal or new policy if a roof is less than 15yrs old. We had to replace our roof in 2022 when it was only 15yrs old. At that time, no one would quote a policy under $4,500 and many said they'd put a waver in the policy that the roof would not be covered at all. We were told that if our roof was just a year or two younger, we could get cost that in half. So we spent 17k on a new roof.

We have Progressive for auto, pay $1300/6mos for two vehicles with higher liability limits, another $500 annually to them for our TT, and then we have State Farm for homeowners and it is $2100 annual renewal this month. SF couldn't beat Progressive for auto/TT and no one could beat SF for homeowners in our market.

 

[crazywayne311]

It's not parts .
It's the uninsured and non licensed drivers
If people that got stopped for no insurance got their ride impounded until a policy in full was presented to court.
As well as no license and driving.. jail
No excuse. 30 days

i 100% agree!
someone correct me if i'm wrong but i have heard in Canada, you cant get a license without proof of insurance.

theres too much BS on our roadways. drunk/high drivers, people with no insurance, suspended licenses, cars with no registration on salvage titles half built, there are even states that require no state inspections for cars.

but my rates gotta go up. hell, if an uninsured driver were to hit me, i'd have to file a claim and my rate would go up. not fair at all.

like you said, if there were consequences, some people might think twice before getting behind the damn wheel

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