State Farm has a tremendous agent organization. Some of the best trained and motivated personal lines agents are found at State Farm. Amy Bach, of United Policyholders, sent a comment to yesterday afternoon’s post, McCarty Claims State Farm Trying to Work Out Deal and Expects Property Insurance Rates to Go Up, which asked:

Will more State Farm agents start diverging from the company line a la United Farmers Agents Association?

Below is an item from the National Association of State Farm Agents‘ website. The letter she referenced provided:

Florida Fallout

Florida agents statewide are in a controlled panic over State Farm’s recent decisions concerning its desire to remain in, or leave the State of Florida. Whether the problem is driven by underwriting issues or political considerations really does not make much difference at this point. The current underwriting restrictions alone are enough to drive many agents out of business.

You are all familiar with the more recent facts. State Farm requested, among other things, a sizeable rate increase. When that increase was denied, it filed a request to withdraw from the fire market in Florida. That request was met with a remarkable opinion from Florida Insurance Commissioner Kevin McCarty (see the entire opinion, and other related documents on In a 14-page order, Commissioner McCarty not only denies State Farm’s request, but takes strong exception to the Company’s conduct to date. State Farm has until March 7 to appeal the order.

The order highlights the strong difference of opinion and approach being taken by Florida and State Farm. One glimmer of light for agency is the finding in paragraph 24 of the order that State Farm is placing too great a burden on Citizens Property Insurance Corporation by only permitting agents to rewrite the policies there. The order goes on to require State Farm to permit it’s agents to write homeowner’s coverage for other carriers. We would expect State Farm to vigorously oppose this idea.

At this time, there are far more questions than answers. Each type of agent contract faces different issues and challenges. Entitlement to or continuation of termination and extended termination benefits being paramount to the AA3/4 agents. However, other critical questions, most directly affecting the agent’s ability to survive, still loom large. Most cannot be accurately answered until Florida and State Farm determine if, and how, State Farm will stay in Florida.

NASFA continues to collect information concerning State Farm’s actions, the State’s actions and company releases to agency.

I suggest that if you want to see whether all of State Farm’s agents truly trust State Farm "to be there," as it advertises it will, you visit the National Association of State Farm Agents website.

Again, for many different reasons, I hope McCarty and State Farm can work out a deal. And, as indicated in my post, Is the State Farm Policy Really Worth Anything?, the current advertisement campaign by State Farm suggesting that it will be there for policyholders after a disaster is a joke.