State Farm, Farmers, Allstate Raising Texas Home Insurance Rates


Well, it’s a new year in Texas, and we all know that means the big homeowner insurance companies will try to raise their rates again. Not that they only do that at the first of the year — it’s a year-round effort for them. And under the crazy insurance system we have in Texas, companies raise their rates, and then afterward, the state can try to object. Excerpts from an article in the Dallas Morning News:

The big three home insurers in Texas are ringing in the new year with hefty premium hikes for their policyholders. Allstate, Farmers and State Farm have notified the Texas Department of Insurance that they are increasing rates for most current and new customers by an average 6.5 percent to 15 percent to offset projected losses. More than 2 million homeowners will be affected.

The Insurance Department will review the rate hikes. It can reject any increases deemed excessive. In addition, the state consumer advocate for insurance is challenging the increases. She argues that the increases are not justified. Whether to overturn them will be new Insurance Commissioner Julia Rathgeber’s first major decision on rates.

Farmers is raising its rates an average 14.9 percent. State Farm is boosting rates 9.8 percent. Allstate has the lowest increase at 6.5 percent. That will affect policyholders with Allstate’s two largest homeowners insurance subsidiaries.

The Office of Public Insurance Counsel is opposing all three rate hikes but raised its biggest objections to the Farmers and State Farm plans. That office tried to block State Farm’s last rate hike, a 20 percent increase in 2012. The agency was turned back by a two-judge panel, which ruled the company’s $317 million in additional charges were not excessive.

Alex Winslow of Texas Watch, a consumer group active in insurance issues, said Texas homeowners are seeing reduced coverage despite the skyrocketing premiums. He noted that Texas had the third-highest rates in a new survey by the National Association of Insurance Commissioners last month. Only Florida and Louisiana were higher.

The rate increases are effective immediately for new customers. They will be reflected in policy renewals through the rest of the year.

1 Comment For This Post

  1. mark melliand
    January 22nd, 2014 | 9:12 am

    As an independent insurance agent it can be frustrating continually moving my client base to a new carrier each year once a policy comes up for renewal. A contributing factor is not only the hail claims but the rising cost of building materials. If the government added back in food and energy back into the Consumer price index, (Inflation) then the true inflation rate is much higher. Too learn more about home insurance basics visit http://www.insurancemadeeasy.us/homeowners-insurance/home-insurance-little-elm-texas/

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