A high-level executive at State Farm was terminated this week following controversial statements regarding the orchestrated nature of California rate hikes and disparaging remarks made about Pacific Palisades homeowners, which were captured in an undercover video.
The video was captured by O’Keefe Media Group.
Driving the news: Haden Kirkpatrick, who held the position of vice president for innovation and venture capital at State Farm Mutual, was recorded implying that the request for rate hikes by the insurer’s California subsidiary was organized in a manner that diverged from common perceptions.
- The undercover video, captured during an alleged January Tinder date, showed Kirkpatrick stating, “Our people look at this and say, ‘We’ve got like maybe $5 billion that we’re short if something happens.’ We’ll go to the Department of Insurance and say, ‘We’re overexposed here, you have to let us catch up our [rates].’ He’ll say ‘Nah.’ And we’ll say, ‘OK, then we are going to cancel these policies.'”
Claims meet reality: State Farm General, California’s largest home insurer, pursued an emergency 22% rate hike for its homeowners’ policies, attributing the need to recent fires and a $5 billion decline in its surplus account over the past decade. Following a hearing with Insurance Commissioner Ricardo Lara, who initially denied the hike but agreed to review additional evidence, the company disclosed possible actions it may take if the rate hike is not approved.
- The estimated losses from the January 7 Pacific Palisades and Eaton fires are projected to exceed $7 billion for the company, although with reinsurance, the net losses are anticipated to be around $600 million.
Additional damaging statements: Kirkpatrick assailed Palisades residents for demanding “natural areas around them for their ego,” referring to their community as “a f— desert.”
- He also attacked a State Farm diversity, equity, and inclusion initiative for beefing up Latino employment in the company.
What they’re saying: In response to the video footage, Michael Soller, a representative for Commissioner Lara, emphasized the need for clarity from State Farm stating, “We want answers from State Farm. This only raises more questions.”
In a statement after the footage was released, State Farm announced that Kirkpatrick was “no longer with the company” and that his comments “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.”
Watch the video:
