State Farm Fire and Casualty Co. is raising insurance rates on nearly 30,000 small rental properties by a statewide average of 19 percent and dropping wind and hail coverage in the New Orleans area and other coastal parishes.
The move is expected to put pressure on small landlords, who are already dealing with rising taxes and sanitation rates, at a time when affordable housing for renters is in short supply in the New Orleans area.
“I think it’s clearly disastrous,” said James Perry, executive director of the Greater New Orleans Fair Housing Action Center. “Every single cost that a landlord has, the landlord has no choice but to pass that on to the renter. This will give an across-the-board increase to the type of rentals that are most important in New Orleans: the mom and pop rentals.”
State Farm was #34 in the Fortune 500 for 2010:
Thanks to a sharp uptick in the company’s investment assets, State Farm still managed to post after-tax profits of $777 million. Too bad you can’t buy shares of State Farm — the insurance giant is owned by its policyholders. But you can purchase just about any kind of coverage from them. And thanks to its burgeoning financial operations, consumers can now borrow money and buy an assortment of mutual funds as well.
h/t F. Illington