Currently the largest auto insurer in the state---Zurich's Farmers Group will eventually supercede State Farm when it completes its acquisiton of 21st Century---State Farm has 3.3 million auto insurance policies in California, covering 13 percent of the auto insurance market. Under the newly approved reduced rates, California policyholders will save an average of about 8 percent, or about $66 per policy per year---a total of $219 million. Rate reductions will go into effect for new or renewed policies after July 6, 2009.
State Farm customers in Los Angeles County will save a total of $50 million per year under the new rate reduction, with the average L.A. driver saving $75 per year. State Farm writes 665,000 policies in Los Angeles County.
“Our premiums are based on what we calculate we will need in the future to meet the obligations we have to our policyholders,” said State Farm’s California Senior Vice President Harbert. “Because our recent experience and trends are favorable, it allows us to pass along those savings to our customers in the form of lower rates. We are pleased to be able to help our customers at a time when many people are struggling financially due to the economic challenges we all face.”