State Farm VP fired after video released of him ‘kind of’ discussing orchestrated California rate hikes
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A State Farm executive has been fired following the release of a recording where he said the company’s California rate hikes are “kind of” orchestrated, according to a Los Angeles Times story.
O’Keefe Media Group released a video last week of Haden Kirkpatrick, State Farm Mutual’s former vice president for innovation and venture capital, responding to a question about the rate hikes being orchestrated with the response, “It kind of is, but not in the way you would think.”
Kirkpatrick follows with an example of how State Farm responds to denial of rate insurance hikes in the state.
“We’ll go to the Department of Insurance and say, ‘We’re overexposed here, you have to let us catch up our rate,’” Kirkpatrick says on the video. “And they’ll say, ‘Nah,’ because the department of insurance and the insurance commissioner is an elected position. And he’ll say, ‘Nah,’ and we will say ‘OK, then we are going to cancel these policies.’”
Kirkpatrick told the LA Times that he was recorded while on a Tinder date, which he suspects was a setup.
KTVU notes James O’Keefe, founder of Project Veritas, posted the video on YouTube.
“The right-wing activist organization is known for secretly recording and releasing deceptively edited videos aimed at attacking progressive organizations and mainstream media,” KTVU says.
State Farm asked for an immediate 22% increase to its homeowners insurance rate in February, claiming the wildfires in the state were the costliest disaster in the history of the company, according to a press release. On Feb. 25, the insurer said it had paid out $1.75 billion on approximately 9,500 claims as a result of the January wildfires.
The company claimed in the release that its direct losses from the fires stand at approximately $7.6 billion.
According to the LA Times, Ricardo Lara has rejected the rate increase but does plan to listen to more evidence from the insurance company.
California’s Consumer Watchdog, a consumer advocacy group, has asked Lara to reject the 22% rate hike following Kirkpatrick’s video admission.
“These remarks strongly suggest that policy cancellations are being wielded as a strategic bargaining tool rather than as a necessary response to financial risk,” Consumer Watchdog Litigation Director Will Pletcher wrote in a letter to Lara. “This contradicts the impression State Farm sought to convey at the meeting—that it would remain in the market if rate relief were granted, and calls into question the transparency and good faith of State Farm’s dealings with both regulators and policyholders.”
In a released statement to the LA Times, State Farm confirmed Kirkpatrick is no longer with the company.
“The individual in the video is no longer associated with State Farm,” the statement said.
The statement also said his assertions are “inaccurate and in no way represent the views of State Farm.”
“They do not reflect our position regarding the victims of this tragedy, the commitment we have demonstrated to the people of California, or our hiring practices across the company,” State Farm said, according to the LA Times.
“And while the focus has been on health insurance, these frustrations extend across the broader insurance landscape,” Feinman writes. “Homeowners insurance, for example, is becoming harder to get in many states, even as coverage is shrinking, and car insurance rates are also skyrocketing. These trends are fueling widespread discontent with insurers of all kinds.”
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