Why are insurance companies pulling out of some states?
Insurers are pulling out of big states, and extreme weather and climate change is factoring into the decisions.
LEARN MOREPosted: 2:37 p.m. EDT Aug 29, 2023
Farmers Insurance is laying off 11% of its workforce — or about 2,400 workers — across all lines of its business.
The California-based company said it is restructuring to be better positioned for long-term profitability.
"Given the existing conditions of the insurance industry and the impact they are having on our business, we need to take decisive actions today to better position Farmers for future success," said Raul Vargas, President and CEO of Farmers Group, Inc., in a statement.
"Decisions like these are never easy, and we are committed to doing our best to support those impacted by these changes in the days and weeks to come," he continued.
Vargas said Farmers aims to manage risk more carefully amid macroeconomic challenges.
The move comes a month after the insurance company pulled out of Florida in a bid to manage risk exposure in the hurricane-prone state.
Farmers also limited new homeowner insurance policies in California — where it is the second-largest home and auto insurer — given the state's high costs and wildfire risks. Allstate and State Farm previously made similar moves in the Golden State.
