Governor demands swift action following State Farm's controversial moves: 'I am deeply concerned'
Illinois Gov. J.B. Pritzker is demanding action after State Farm announced that homeowners insurance rates in the state will rise by 27% on average in August.
What's happening?
WBBM confirmed the price hike after receiving an email from State Farm.
This change is happening because State Farm's profits are dropping. The company said that it spent $1.26 for every $1 per homeowner paid in 2024.
Pritzker suggested in a statement, however, that part of State Farm's story isn't adding up: "I am deeply concerned by State Farm's unfair and arbitrary insurance rate hike. … 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 on to the homeowners in our state."
Why is this price hike important?
State Farm said that these price hikes are also occurring because severe weather is happening more often. Illinois reportedly had more claims for hail damage in 2024 than any other state except Texas, per CBS News Chicago.
While severe weather events aren't unusual, the scientific consensus is that they are becoming more extreme because of rising global temperatures.
If premiums continue to rise across the country and beyond, this will make it more difficult for so many people to afford even the essentials.
What's being done about the price hike?
The governor is calling on the Illinois Department of Insurance and the state's General Assembly to take action. Through a combination of legislative and regulatory acts, Pritzker hopes that this will lower rates for Illinois homeowners.
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