State Farm, Community Brace for Crist’s Decision
Company employs 1,700 in Winter Haven, insures over 46,000 in Polk.
By Merissa Green
The Ledger
Published: Saturday, June 13, 2009 at 12:01 a.m.
Last Modified: Sunday, June 14, 2009 at 12:24 a.m.
WINTER HAVEN | When Shannon Gomez was a little girl, she couldn’t wait to be old enough to work for State Farm.
While her friends were playing house, Gomez, now 23, pretended she was a State Farm agent like her father, Charlie. She would scratch his name off business cards and replace it with her own. She would sit on the couch and call people from the phone book to sell them insurance.
Today, Gomez is an auto claims representative at State Farm’s Florida Zone regional office in Winter Haven and her father is vice president of the agency at the same location. Despite the company’s announcement earlier this year that it would pull out of the Florida market after the state denied it a 47 percent property insurance rate hike, she’s hopeful one day she’ll fulfill her dream to become an agent.
"I was a little surprised," she said about the announcement. "However, I know State Farm is a good company and it will grow from this."
The company’s property insurance operations hang in limbo as it waits to see whether Gov. Charlie Crist will sign or veto House Bill 1171, which would remove state oversight of rates set by property insurers like State Farm.
Supporters of the bill say consumers would have more choices instead of being forced into state-run Citizens Property Insurance.
State Farm Florida is the homeowners’ property insurance division of State Farm. It employs 500 people including fire claim representatives and underwriters in Winter Haven. Along with its automobile unit, the company employs 1,700 employees at the Winter Haven Operations Center at 7401 Cypress Gardens Blvd. According to the Florida Office of Insurance Regulation, State Farm has more than 46,000 property policyholders in Polk County, and is the largest insurer here.
Community leaders say losing Polk County’s largest private employer would economically affect private and community groups.
In 2008, State Farm gave $92,550 in donations to various charities and organizations across Polk, including Girls Inc., Chain of Lakes Achievers and the Winter Haven Chamber Foundation. Through June, it has given $40,900 to the Lake Wales Care Center, Friends of the Winter Haven Library and Junior Achievement, among others.
"It’s so big that we really couldn’t have Junior Achievement without State Farm,” Lily Romine, JA executive director, said about the company’s impact. "We know that it helps children because they tell us how much they appreciate it and what they’ve learned."
State Farms allows 300 of its employees to serve as volunteers at Polk schools – from serving as mentors to supporting school initiatives, said Margaret Anne Wheeler, the school district’s senior coordinator of community involvement.
"We use a lot of their people and we also use a lot of their financial services," Wheeler said. "We certainly appreciate everything they do to provide service learning in our district."
Terry Worthington, executive director of United Way of Central Florida, has seen State Farm’s impact on the community since 1987 when he was first hired with the nonprofit organization.
Worthington said the company has contributed millions of dollars through his agency.
"State Farm is a solid corporate citizen, and they emphasize on giving back to the community including placing value on diversity and a high-quality workplace," Worthington said. "They really do place a high priority on training and growing their employees."
Community organizations won’t be the only ones financially affected if State Farm changes the way it does business. Nearby merchants would also feel the blow, especially those at The Shoppes at Miller’s Landing, across the street from the regional headquarters.
"I see people from over there every day," said Jessica Hohmann, co-owner of Cuttin’ Up Salon. "It would definitely hurt us."
Wendy Morrison, owner of the Baja Heat Tanning Salon, agreed.
"I see quite a few people coming over at lunchtime and during the evening hours," Morrison said. "I think it would have a big impact."
A countywide effect would be felt, too, if State Farm eliminates home policies.
"If they are writing fewer policies for automobiles and homes, then the insurance agents who represent State Farm may have to cut back on office staff and that would be terrible," said Jim DeGennaro, the Central Florida Development Council’s senior business marketing manager.
"We don’t want a worst-case scenario. We want a strong, viable contributor to our economy as they have been for decades.
"Every job at State Farm and other businesses is critical in these tough economic times," he said. "We would hate to see the loss of one job at the regional headquarters."
Bob Gernert, executive director of the Greater Winter Haven Chamber of Commerce, is worried about the company’s pending decision to pull out of the home insurance market.
"That’s going to affect every State Farm agent in Florida," Gernert said. "These people are going to be hurt financially and it’s significant. Governor Crist is callous and uncaring about that fact."
State Farm’s ability to stay in the homeowners’ insurance business in Florida is the company’s biggest challenge, said Jim Thompson, president of State Farm Florida.
"If he (Crist) doesn’t sign the bill, that narrows our options," Thompson said. "If he does sign the bill, it gives us some cautious optimism."
In the meantime, company officials are preparing for hurricane season and working to help employees and agents get through the company’s pending withdrawal.
Some of the company’s longtime employees are staying optimistic and said State Farm will get through the political storm.
Judy Winfree, 59, who has been with the company for 40 years, said she’s not worried because she has seen the company go through transformations before – from women not being able to wear pants in the workplace to technological advances of a paperless system.
"I believe State Farm is here to stay, and they’ll be in business after I retire," she said.
[ Merissa Green can be reached at merissa.green@theledger.com or 863-401-6968. ]