GEICO, one of the largest insurance companies in the United States, reportedly closed all 38 of it’s California offices on Monday, resulting in hundreds of workers being laid off.
According to the company, GEICO would not be leaving outright, and will still be offering policies directly online, with all insurance functions continuing as normal. Buying directly through agents by phone, however, will not be possible.
“We continue to write policies in California, and we remain available through our direct channels for the more than 2.18 million California customers presently insured with us,” said GEICO in a statement on Monday.
As of Monday, GEICO has not released the reasons why the offices closed or if the offices in any other states will close in the near future.
The California Department of Insurance is currently overlooking the situation to make sure that GEICO still gives adequate access to Californians and that the office closures won’t disrupt the over two million policies in the state.
Close to 100,000 policyholders will lose their insurance coverage this month and in mid-July and Insurance Commissioner Jim Donelon addressed the insurance crisis Thursday (June 16).
Donelon said the June 22 cancellation date of 30,000 Lighthouse Excalibur policies has been pushed back to June 30. Additionally, another insurer, Maison plans to cancel about 12,000 policies on June 30. Donelon announced that yet another insurance company, Southern Fidelity will cancel more than 40,000 policies in July.
“Southern Fidelity is a Florida-based insurer with about 42,000 policies in Louisiana. Florida placed them, that company into liquidation yesterday which means Southern Fidelity’s Louisiana policyholders will have their policies canceled on July 15. Like Lighthouse policyholders, Maison and Southern Fidelity policyholders need to contact an agent now to find a new policy if they’ve not already done,” said Donelon.
Donelon says there are other insurers in the private market in the state and Louisiana Citizens, the insurer of last resort is in good shape and can absorb people who cannot get insurance from private companies.
Some insurance agents FOX 8 has spoken to say they have never seen it so bad, in terms of the insurance landscape, in the state.
Is this recession or collapse related? Is it related to the deagal blackrock stuff? What’s going on!? Anybody?