Illinois Governor Pritzker criticizes State Farm over homeowners insurance rate hikes

By Mia MacGregor

July 11 - (The Insurer) - Illinois Governor JB Pritzker has expressed strong concerns over State Farm's decision to increase homeowners' insurance rates in the state, calling the move unfair and arbitrary.

State Farm is raising rates by an average of 27.2%, affecting approximately 1.49 million policyholders and adding $522.8 million in annual written premium, according to a June 2 filing with the Illinois Department of Insurance.

The maximum approved rate hike stands at 39.9%, as noted in a regulatory filing.

“These increases are predicated on catastrophe loss numbers that are entirely inconsistent with the Illinois Department of Insurance’s own analysis – indicating that State Farm is shifting out-of-state costs onto the homeowners in our state,” Governor Pritzker said. “Hard-working Illinoisans should not be paying more to protect beach houses in Florida.”

Alongside increased premiums, Governor Pritzker noted that State Farm plans to raise deductibles and reduce payouts for certain claims, potentially costing homeowners hundreds of extra dollars annually without justification or added protection.

“Over the past six years, our state economy has flourished based on transparent markets and fair competition. State Farm's actions are antithetical to the core principles that the Illinois business community is built on.”

The governor has directed the Illinois Department of Insurance to pursue all regulatory actions to enforce fairness and protect Illinois homeowners. He also urged the General Assembly to pass legislation during the veto session to prevent severe and unwarranted insurance rate hikes by companies like State Farm.