Updated 6:35 p.m. ET
(Bloomberg) -- State Farm MutualAutomobile Insurance Co., the largest U.S. home and autoinsurer, plans to shut 11 U.S. facilities, displacing about 4,200workers, after a $7 billion annual underwriting loss last year onauto policies.
The insurer will exit Parsippany, New Jersey,and Petaluma, California, in 2018 and the otherlocations by 2021, the Bloomington, Illinois-based company saidThursday in a statement on its website. The work will move to theheadquarters and offices in cities including Atlanta, Dallas andPhoenix. The company said employees in affected facilities willhave opportunities at other State Farm locations.
Higher claims expenses from car crashes
State Farm, Allstate Corp., Hartford Financial Services Group Inc.and Warren Buffett’s Berkshire Hathaway Inc. are among companiesthat have been burned in recent years by higher claims expenses from car crashes as more drivers aredistracted by electronic devices. Higher repair costs have also hurt in an erawhen drivers are logging more miles behind the wheel. Companieshave been charging more for coverage and looking for ways to reducecosts.
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