To state Rep. Joaquin Castro, D-San Antonio, State Farm is no good neighbor.
After an Austin judge ruled this week that the insurance giant owes its Texas customers $350 million for overcharging for premiums between 2003 and 2008, Castro dropped the home and car insurance policies he's held with the company since 2000.
“Your refusal to make good for overcharging your customers in this state is a disservice to the thousands of Texas policyholders that have trusted you with their most important investment, their home,” Castro wrote in a letter mailed this morning.
State Farm is appealing the judge's ruling.
In an interview, Castro said he often hears complaints from his constituents on the high costs of insurance premiums — especially for homeowners insurance. He said he is amazed that State Farm would continue to fight the court order and lawmakers' previous attempts to reign in the cost of insurance.
The $200 to $300 State Farm owes to roughly 1.2 million Texas customers is money that parents could spend on health insurance for their kids, that college students could spend on textbooks and that the elderly could use for medication, Castro said.
“I want them to know that legislators are watching what they are doing,” Castro said. “It’s past time that they settle up their debt with their policyholders.”