Farmers Seeking 22% Home Insurance Rate Hike in Ohio

Home insurance may be about to get more expensive in Ohio. Three Farmers subsidiaries — Farmers Insurance Exchange, Farmers Insurance of Columbus Inc., and Fire Insurance Exchange — submitted filings on June 18 to request home insurance rate revisions in the state.

In a revision memo filed by Farmers Insurance Exchange, the company requested an overall rate change of 22.4%.

Reason for rate increase request

In all three filing memos, Farmers cited claims losses as justifying a 22.4% rate increase. Farmers companies in Ohio incurred losses of nearly $25.4 million during the 2023 fiscal year, which is about $3.3 million more than their losses of $22.1 million during the 2021 fiscal year.

Currently, the average annual cost of homeowners insurance in Ohio is $1,342, according to Insurify’s latest home insurance report. Insurify’s data analysts predict the state’s average cost will rise 5% in 2024.

Breaking down the requested 22.4% rate increase

The requested rate revisions will affect premiums for a few different Farmers homeowners insurance programs if approved, including the Farmers Smart Plan Home Program, the Next Generation Homeowners Program, the Farmers Smart Plan Renters Program, and the Smart Plan Condominium Program. Farmers Insurance Exchange, Farmers Insurance of Columbus Inc., and Fire Insurance Exchange all offer these four programs to customers in addition to other home insurance products.

If approved, Farmers’ request will result in an overall rate increase of 22.4% for the subsidiaries’ home insurance products in Ohio, affecting 115,700 policyholders in the state. Current and future policyholders in Ohio with any of the homeowners insurance programs below will face increased rates upon purchasing or renewing a policy.

The chart below shows the requested rate increase and estimated financial impact for policies under each affected program, as well as the combined overall rate increase when included with all homeowners insurance products in Ohio.

Farmers Home Insurance Program	Program Rate Increase	Estimated Financial Impact	Combined Rate Increase
Smart Plan Home Program	13%	$4,194,000	6.7%
Next Generation Homeowners Program	17.5%	$3,345,000	5.4%
Smart Plan Renters and Condominium Programs	20% for renters; 30% for condominiums	$294,000	0.5%

What’s next?

All three filings are waiting for further response from the Ohio Department of Insurance. The Farmers subsidiaries have been involved in back-and-forth communication with the state insurance department regarding the state’s objections to matters in each filing.

The objection and response process appears standard when compared to past rate filing interactions between Ohio insurance companies and the insurance department. The Ohio Department of Insurance approved a similar rate increase request of 26.5% during June 2023 after initial objections.

The status for each current Farmers filing is pending response. It’s unclear how long this communication will last and whether it will result in the approval of the rate filings.

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