State Farm Ups Some New Eng. Auto Rates

State Farm Ups Some New Eng. Auto Rates

NU Online News Service, Dec. 1, 2:15 p.m. EST?Rates charged by State Farm Automobile Insurance Company are increasing an average of 4 percent in Maine and 2.6 percent in New Hampshire effective Dec. 15, according to statements issued by the insurer's Manchester, N.H. office.

The increases were relatively moderate. "These are low-severity states for auto accidents, even with the tough winters with snow and low temperatures," noted Douglas Nadeau, a Manchester-based public affairs specialist for the company's New England territory.

Mr. Nadeau pointed out that State Farm is no longer writing new auto policies in Massachusetts and Rhode Island. No imminent underwriting or rating changes for Vermont and Connecticut were reported.

There is great disparity in New England as far as auto insurance exposures are concerned, Mr. Nadeau noted. "There are rural versus urban issues, a lot less cars on the road in some areas, and much less fraud in some areas compared to others," he said.

In Maine and New Hampshire, all liability and medical payments premiums will go up, while some comprehensive and collision premiums will go up and others will drop, Mr. Nadeau indicated. State Farm has about 13 percent of the auto market in these two states, the statement noted.

"Maine and New Hampshire, along with Vermont, are in the lower third of states nationwide for insurance-related expenses," Mr. Nadeau said. "On the other hand, Massachusetts, Connecticut, and Rhode Island are top-10 states for expenses."

He continued that costs for repairing cars are higher in Massachusetts compared to other states, and the fraud problem is greater.

"State Farm has a very small policyholder base there, the company is renewing existing customers but not writing any new ones," he said.

Rhode Island, he added, is similar to Massachusetts in that "you have a large urban area (Providence), a dense population, more cars on the road, and more accidents. State Farm is not writing any new auto business in Rhode Island."