State Farm and the State of Florida Play Poker, Insureds Are the Biggest Losers

It’s been a very large pissing contest, and now it may be over.  Where did the piss wind up?  In the eyes of State Farm’s insureds.

State Farm officials have been playing poker with Florida’s Insurance Commissioner for years as they tried to get unconscionable rate increases approved.  The State told The Farm to go suck a hose.  State Farm has now gone all in, announcing today they are pulling out of the Florida homeowner’s insurance market and will be canceling some 1.5 million policies.   And Florida has called their bluff, saying, “Florida already has new companies who are eagerly looking to grow their businesses and will welcome the opportunity to add more customers.”

Sure, Florida has new companies.  Florida has become  so desperate to attract any new insurer to write business in the state they are accepting pitifully underfunded companies with unproven track records.

I’ve been happy with my State Farm policy.  They stood by most of their policyholders after Hurricane Andrew changed the South Florida and Insurance landscapes in August of 1992.  While  Allstate and Prudential did mass cancellations after Andrew, State Farm kept their current policyholders and mostly just stopped writing new business. I was proud to be able to reassure people that their policies were safe.

State Farm insureds enjoy a much better homeowners policy than the standard ISO policy most of these start-up companies offer.   More endorsements are available (things like business property, backup of sewers and drains coverage, increased jewelry and furs, gun coverage, incidental office, etc.), more personal property coverage is available, and our agents have more influence in the underwriting and claims process.

Now they are setting us adrift.  But gee, I’m so glad to know they’re going to be happy to keep my auto, life and other policies.  Thanks, guys!

State Farm or the State could back down and fold their hand, but we’ll still end up losing.  No matter what happens it’s bad news for State Farm insureds.   And for several of  my friends, who are sure to lose their jobs as their employer/agents lose 40- 60% of their income.

Come my renewal I’ll probably need to get a different policy with less coverage and a higher price tag.  I’m just disgusted.

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Hospital Income Policy A Terrific Buy For My Family – How About Yours?

The following information is not advice, it’s just my thoughts and opinions. I’m just a girl on the web, not currently licensed in insurance or anything else in any state. You should absolutely seek the counsel of an insurance agent licensed in your state before taking any action at all. This is only a brief explanation of coverage. Modifications are applicable in some states. Coverages and programs discussed may or may not be available in your state.

Also know that I don’t work for State Farm any longer and am not being compensated in any way for this article. It’s just a good policy.

I love this policy. And them’s some strong feelings about an insurance policy. I promised you all I would tell you about it, so here it is.

I’m not sure if I’d have discovered this policy if I hadn’t been working for State Farm as an insurance agent. It’s not well publicized, but it can be a terrific part of anyone’s health insurance portfolio.

What is it?

If you’ve ever been hospitalized you know that there are expenses your primary health insurance just doesn’t cover. Additionally the inconvenience of simply being hospitalized means additional expenses for you and your family. Things like:

• Deductibles and Co-insurance
• Private Room and Private Duty Nursing Fees
• Transportation
• Child Care
• Lawn & House Care
• Meals Out
• Pet Care

State Farm’s Hospital Income policy helps provide the money you’ll need to pay for those extra expenses when you’re hospitalized. It can offer you an ideal way to supplement your health insurance coverage.

If you are hospitalized for a covered injury or sickness (and really, there aren’t many exclusions) the policy pays the selected hospital income amount (mine’s $100/day*, but I wish I’d taken more!) for up to 365 days of confinement in a hospital.

One of the exclusions is for normal pregnancy and childbirth. However, complications of pregnancy and childbirth are covered. When I had Son I needed an emergency Cesarean Section, so my five day hospital stay was covered. Son had some minor complications so his stay was covered, too. He was automatically covered at birth as long as I added him to the policy (and paid the additional premium) within thirty days of his birth. It also covered his three day RSV induced hospital stay when he was 21 months old – the longest days of my life.

When Intensive Care is needed the policy pays an additional benefit equal to the hospital income amount not to exceed 14 days. So for me that means I get an additional $100 per day if I’m in ICU.

One of my former coworkers has a $200 per day policy. When her daughter was born six weeks prematurely she was in the pediatric intensive care unit for three weeks, then hospitalized another two. With her own hospital stay, her daughter’s hospital stay and the extra $200 per day she received for 14 of the 21 days her daughter was in intensive care my coworker received over five thousand dollars from her hospital income policy – enough so that she could stay home with her, unpaid, until her daughter was off a heart monitor and able to be placed in daycare so she could return to work.

Can you imagine the financial disaster she would have suffered if not for this spectacular little policy?

When Extended Care is needed the policy pays half the hospital income amount (so for me that would be $50 per day) for up to sixty days per calendar year while in a qualified Extended Care Facility. In most states extended care must begin within 14 days after at least a three day hospital confinement.

But that’s not all. And that’s not even my favorite part of the policy.

When you are injured accidentally the policy pays up to five times the hospital income amount (in my case up to $500) for x-rays or emergency first aid if received within 72 hours of the injury. If I have over $500 in emergency room or doctor costs, I get $500. If the bills are less than $500 I get whatever the bill amounts to.

I have used this portion of the policy many, many times. In the last ten years there have been at least three car accidents (none my fault!) that have ended in emergency room visits and one broken arm (on January 7th, so my $500 primary policy deductible had not yet been met). Each of those (and there may be more events I’m just not recalling right now) netted me $500.

There was also an incident, when Husband and I were trying to conceive Son, where I stepped wrong and broke a few toes. I wasn’t sure if it was just my toes or if my foot was broken, too, so I went to the ER (if I’m going to be in so much pain I may as well get paid for it!). I wouldn’t allow them to do X-rays (I could have been pregnant). The doctor assured me my foot wasn’t broken, taped my toes together and billed me $420. My primary insurance paid 90% (I’d met my yearly deductible, and my co-insurance was reduced because I went to an in-network hospital), so after paying my co-insurance I pocketed $378.

Isn’t that fab?

And if you have kids you know how often accidents happen. We’ve already collected from the policy twice for Son, including the incident last summer when he thought it would be fun to shove a rock up his nose. That sucker was wedged up there.

And there’s more.

When outpatient surgery is needed the policy pays the hospital income amount ($100 for me) for outpatient surgery not otherwise covered by outpatient benefits.

This is probably the part of the policy we’ve used most. Any outpatient surgery is covered. We’ve collected for all three of my colonoscopies and Husband’s one, his cardiac catheterization, three of my cyst removals, several mole removals, skin cancers. It even covers skin tag removal, which is so much of a nothing I’ve taken them off myself (isn’t aging sexy?).

So if I really needed some money one month I could, if I were so inclined, go to the dermatologist and pay my $25 co-payment, have her remove a skin tag or two and file a claim under my Hospital Income policy. I’d make $75 on the deal. And have fewer skin tags. Not that I’ve done that just because I’m short of money.

But I could.

Yes. I get paid to go to the doctor. Isn’t that smashing?

What else to like about this policy?

The benefits start from the first day of confinement. No waiting period!

The money is paid directly to you, unless you say otherwise. You decide how the money is spent. Use it to pay your deductible, you coinsurance or go on a trip to Tahiti. You decide!

The money isn’t taxable income. It’s insurance policy proceeds, so not counted as income (There may be some odd rule somewhere that I’ve never heard about that may make this taxable some minute fraction of the population, so please ask your tax advisor for a definitive answer. After all, if I wanted to know everything there was to know about taxes I’d have become an accountant like my father!).

Family coverage is available. You can cover just yourself, or add your spouse and kids. Remember that newborns are covered automatically as long as you notify the company and pay the premium.

It’s not expensive. We cover all three of us for about $280 for the year, and we’re oldish. The premiums will vary based on your age(s) and the policy amount chosen. I’ve not had a year yet that I didn’t collect more than I’ve paid. Of course if it was that way for everyone the company couldn’t offer it! Also know that the premiums can and do increase periodically as you age.

The policy is Guaranteed Renewable. Except in the event of fraud, material misrepresentation, nonpayment of premium, or expiration of the policy.

This policy is a great supplement to today’s high deductible plans, and also a great option for anyone with a HSA plan (State Farm also offers one of those). It should obviously not be your only coverage. If you have State Farm Auto and no other insurance with them you’ll also get a discount on your auto insurance for buying this policy.

You do have to medically qualify for the plan, and there are exclusions. The medical qualification is the only thing that keeps me from increasing our policy amount – with Husband’s diabetes and Son’s asthma we’d get denied. Dadgummit!

So call your local State Farm agent and get a quote. Even if you don’t have any other State Farm coverage. It’s definitely worth looking into.

Florida Residents: Save Money By Combining Citizens Policies

I called my old office last week to get a quote for insurance for my Dad’s new condo. I knew that State Farm would not let him move his policy from the house to the condo – the condo is right on the beach. I also knew he’d need a policy through Citizens Property Insurance Company, the state entity. What I didn’t know was that if you live in Florida and Citizens Property Insurance Company insures you separately for Homeowners and Wind coverage, you may save a bundle by getting these policies combined – something they didn’t used to do.

This could save some people a great deal of moolah.

First let me explain how we got where we are…

1970

The state of Florida started the Florida Windstorm Underwriting Association (FWUA) to provide Windstorm only coverage for people who could not find it through the regular market, specifically Florida’s coastal properties in Monroe County and the Florida Keys. Over time, the FWUA was expanded to include all or parts of 29 of Florida’s 35 coastal counties as insurers grew wary of insuring those properties closest to the coast.

1992

In the wake of Hurricane Andrew the insurance industry was in trouble. Several went out of business and the ones that remained decided to cancel large chunks of their policies to reduce their potential loss exposure in the event of another major hurricane. As a result there was a need to create another residual market for people that were being canceled, as no insurance company was accepting new policies. The people of Florida needed a policy similar to a standard multi-peril Homeowners policy. The Florida Residential Property Casualty Joint Underwriting Association (FRPCJUA) was created in 1992 and was structured similarly to the FWUA. At the same time insurers decided to expand their definition of “coastal” and began excluding windstorm coverage from homeowners policies for millions more. The FWUA was expanded to cover Dade, Broward, and Palm Beach counties, and Hillsborough and Pinellas counties followed a short time later.

So.

That left people with either:

• FRPCJUA policy for multi-peril (Homeowners) and wind
• FRPCJUA policy for multi-peril (Homeowners) and FWUA for wind
• X Company for multi-peril (Homeowners) and wind (no change)
• X Company for multi-peril (Homeowners) and FWUA for wind

Got it?

2002

Citizens Property Insurance Corp was created when the Florida legislature passed a law combining the Florida Residential Property and Casualty Joint Underwriting Association (FRPCJUA) and the Florida Windstorm Underwriting Association (FWUA). The organizations may have been combined but wind was still written as a separate policy for the next five plus years, so many people had/have a Citizens Homeowners policy AND a Citizens Wind policy. Two policies, two bills, two sets of paperwork (and some have a separate Flood Insurance policy, too!).

2007

On August 1, Citizens Property Insurance Corporation rolled out a new product: one policy that covers both windstorm damage and traditional multi-peril (Homeowners) coverage. The two-for-one coverage is in response to a change in Florida law designed to make Citizens more profitable and less vulnerable to the risk of a catastrophic event. According to Citizens, policyholders who combine their plans could see annual premium savings of up to 10% (When my Dad’s policy was quoted it was more like 20-30%, but his is right on the ocean). Citizens customers who have windstorm coverage through Citizens and multi-peril coverage from a private insurer may also take advantage of the new single policy.

The Bottom Line:

If you have any Citizens Windstorm policy call your insurance agent to see if you can take advantage of the new policy and see how much you’ll save. They don’t just do a price adjustment so you will need to have a new policy written. That means you’ll have to have money available to pay the new premium and then wait to get pro-rated refunds on the old policy(ies), or wait for renewal.

Either way better in your pocket than the state’s.

~

The preceding information is not advice, it’s just my thoughts and opinions. I’m just a girl on the web, not currently licensed in insurance or anything else in any state. You should absolutely seek the counsel of an insurance agent licensed in your state before taking any action at all. Coverages and programs discussed may or may not be available in your state.