ATLANTA - A letter from Farmers Insurance went to thousands of homeowners this month warning them that their homeowners' insurance was about to be canceled if a certain strict stipulation wasn't met. It was unexpected and alarming.
The July 6 letter titled, "Notice of Non-Renewal" was sent to policyholders stating that the policy would be canceled on August 20 unless the policyholder could prove the home had a roof that was less than 15-years-old.
It reads, "We are unable to renew home coverage due to the age of the roof." It continues, "If your roof was fully replaced less than 15 years ago..." and you can prove it, you will be renewed.
The Georgia Insurance and Fire Safety Commissioner John King told the FOX 5 I-Team that calls started coming to his office. Yes, some from consumers, but mainly from Farmers Insurance agents who were also alarmed by this random policy change. The commissioner says this is flat-out illegal. You can't change a policy midstream.
"My job is to go and protect consumers, and when a company gets out of line my job is to call them up and say, ‘Hey,’ and that's what we did with Farmers. We told them, ‘Hey, this is against Georgia law. You got 24 hours to change it.’"
We are told King made a call to Farmers Insurance's corporate headquarters on Wednesday, a call that has been described as very "frank."
A statement to the FOX 5 I-Team from Farmers Insurance reads: "We have decided not to move forward with our plan to non-renew a limited number of homeowners policies with older roofs. We have begun to notify affected customers of this decision."
"We are going to watch this very carefully," the commissioner added. "Just because they say they're rescinding it over a phone call, we are going to be watching very carefully. If not, we will be waiting with our investigators ready to sanction them. It's in their best interest to notify consumers as quickly as possible because we will be watching."
King also said that the case is still open, and the department could still consider administrative action against Farmers Insurance, which he says, has around 36,000 policies in Georgia.