Parent of State Farm Florida posts $777 million profit for 2009

State Farm, by far the largest property and auto insurer in Florida, posted a $777 million profit in 2009 thanks to improved underwriting results and investment returns. The profit reverses a $542 million loss in 2008 for the Bloomington, Ill., insurance giant.

The company's property-casualty businesses reported a pretax operating gain of $393 million last year, despite an underwriting loss of $3.7 billion. Catastrophes cost the company about $3.6 billion.

Chief executive Ed Rust made $9.4 million, down from $13.7 million in 2008, with his compensation negatively affected by the financial results of 2008.

State Farm's Florida unit in December struck a deal with regulators to boost its homeowners insurance revenue as a condition for not pulling out of the state. The company, which is dropping 125,000 homeowners policies statewide, received approval to raise rates for its remaining home­owners 14.8 percent.

Plus, it has filed for an average 9.2 percent rate hike for its 2.7 million auto policies in Florida.

State Farm is owned by policyholders and reports results once a year.