State Farm Says $5B in Cat Claim Payments So Far for 2011

Updated 9/27, 12:04 p.m.

NU Online News Service, Sept. 26, 11:35 a.m. EDT

State Farm says it has paid policyholders $5 billion so far due to weather-related catastrophes, and the Bloomington, Ill.-based insurer says 2011 is “likely to be one of the company’s busiest years on record for catastrophe losses.”

The company notes that a “summer of wildfires, tropical storms and hurricanes followed a spring of relentless tornadoes and hail storms,” adding that State Farm agents and claims representatives have assisted policyholders on more than 970,000 catastrophe claims this year through Sept. 23.

“The unrelenting, widespread volatile weather continues to cause problems for our policyholders. Our claim teams have risen to the challenge and we are prepared with the necessary resources to respond. About 4,300 specifically dedicated catastrophe claim representatives have joined thousands of local claim professionals and agents at catastrophe sites across the country,” says Brian Boyden, State Farm executive vice president, in a statement.

To put the figure in perspective, State Farm Spokesman Dick Luedke says Hurricane Katrina in 2005 cost the company $3.9 billion in indemnity payments, "so this is greater than that." He notes that although Katrina was one storm while payments so far this year cover several events, Katriana was the costliest storm ever for the company. 

State Farm says it has reported declared catastrophes this year in Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Vermont, Virginia, West Virginia, Wisconsin and Wyoming.

About the Author
Phil Gusman, PropertyCasualty360.com

Phil Gusman, PropertyCasualty360.com

Phil Gusman is Managing Editor of PropertyCasualty360.com. Prior to joining National Underwriter in 2008, he was Editor of Insurance Advocate. Gusman has also served as Associate Editor of Crackdown!, an insurance fraud publication, and Assistant Editor of Empire State Report, which covers New York politics. He graduated in 2002 from Plattsburgh State University in New York. Gusman may be reached at pgusman@summitpronets.com. Follow him on Twitter: pgusman and PC360_Markets

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