San Diego Superior Court Judge Katherine Bacal on Thursday denied State Farm's emergency request to stay a November order issued by California Insurance Commissioner Dave Jones that directed State Farm General Insurance Co. to reduce homeowner and renter rates by 7 percent and issue refunds totaling more than $100 million to its policyholders.
While the court set a hearing for Dec. 16 on State Farm's motion for a stay, the rejection of the emergency order means the Jones's rate order will go into effect on Dec. 13 as scheduled.
After State Farm requested a rate increase of 6.9 percent, Jones held a public hearing. Based on the evidence presented during the hearing, Jones determined that “rates charged by State Farm are excessive.”
Jones ordered State Farm to reduce its homeowners' insurance rate by an average of 5.37 percent, its renters' insurance rate by an average of 20.39 percent, and its condominium insurance rate by an average of 13.81 percent — for a total average of 7 percent.
“State Farm is disappointed with the commissioner’s decision regarding State Farm General Insurance Co. homeowners rates in California. We do not believe the mandated rate reduction and rate refund are lawful, and we are considering our options, including taking legal action,” a spokesman for State Farm told PropertyCasualty360.com in November.
"State Farm's lawsuit challenging my order is an attempt to weaken consumer protections provided by Proposition 103, and deprive consumers of a $100 million rebate and ongoing relief from excessive insurance rates," says Jones.
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