State Farm Reports 56% Drop in Net Income Driven by Cat Losses
By Michael Buck
March 2, 2012
State Farm, the nation's largest property/casualty writer, posted a 56% drop in net 2011 income from the previous year, citing a disastrous catastrophe year, the company said in a written statement.
The mutual company, which is owned by its policyholders and reports financial performance annually, saw its 2011 net income drop to
"In our business that number is pretty volatile," said State Farm spokesman
Luedke said the company typically looks at net worth as its main metric for its financial health. The company in 2011 saw its net worth drop by
"We need to remain financially strong so that we can keep the promises that we make to our customers and that's the cushion that we have that allows us to make those promises," Luedke said.
The company's combined property/casualty operations in 2011 sustained a
Last year's catastrophe activity was unusual in that it was a series of disastrous events as opposed to one gigantic one, Luedke said.
"The thing about 2011 is that there wasn't a Hurricane Katrina or a Hurricane Andrew type of event, or a major earthquake in
State Farm Group currently has a Best's Financial Strength Rating of A++ (Superior).
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