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State Farm encouraged by talks, but still plans pullout

State Farm Florida said Friday it's encouraged by talks with Florida Insurance Commissioner Kevin McCarty but the giant insurer is not reversing its plan to pull out of Florida's property insurance market.

"The fact is nothing has fundamentally changed," State Farm spokesman Chris Neal said. "We do believe we're having very productive negotiations, but what we're negotiating is the withdrawal of State Farm Florida Insurance. It's just that simple."

"Our risk is still way too high and our premiums are woefully inadequate," Neal added. "Until that changes, the only responsible thing that we can do is continue to seek to withdraw from this market."

Neal said he was encouraged that McCarty acknowledges a desire to keep State Farm. Earlier, McCarty and Gov. Charlie Crist downplayed the loss of the insurer, saying that other Florida insurers could absorb most of the dropped State Farm policies.

In an interview Thursday with the Palm Beach Post, McCarty said he's "cautiously optimistic" that State Farm will keep at least some of its homeowners policies in Florida. ( http://www.palmbeachpost.com/money/state-farm-will-continue-homeowners-insurance-in-florida-53822.html)

Bloomington, Ill.-based State Farm is Florida's largest private insurer of homes. It announced in January that it would stop writing property policies statewide, including about 700,000 homeowners policies.

State Farm and Florida regulators, however, have been at odds over terms of the withdrawal. In recent weeks, McCarty has told the St. Petersburg Times, the Florida Cabinet and others that he's encouraged by the talks.

Jeff Harrington can be reached at jharrington@sptimes.com or (727) 893-8242. Follow him on Twitter at twitter.com/jeffmharrington.

State Farm encouraged by talks, but still plans pullout 11/13/09 [Last modified: Friday, November 13, 2009 11:31am]
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