Homeowners Insurance Lowdown

Here’s some really great news for Californians who have taken homeowners insurance from Farmers Insurance. Farmers Insurance, the second largest writer of homeowners insurance in California, recently requested an 18 percent overall reduction in its homeowners insurance rates for policyholders.

The proposed rate decrease, which stands at $171 million, will impact nearly one million homeowners and renters and may take effect in June 2007. The rate cuts will benefit their Special Form, Protector Plus, Renters and Condominium Owners customers. There’s still more good news. Farmers is also planning to introduce a “claim forgiveness” policy for customers who remain “claims free” with the company for six or more years prior to filing a single claim.

I wonder if all this large heartedness is thanks to Insurance Commissioner John Garamendi’s review of the insurance industry. Last year, Garamendi ordered Allstate, State Farm, Farmers and Safeco Insurance to justify their homeowner rates. Whatever be the case, it still is good news and probably it will have a domino effect on the other insurers as well. Let’s wait and watch.

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