Phoenix woman says State Farm Insurance not a good neighbor

Posted: Updated:

PHOENIX -- A Phoenix woman says she's been given the boot by her longtime insurance company.

As 83-year-old Margaret Lane looks at a picture of her late husband, she remembers the many memories they shared during their 61 years of marriage.

She says there are two things in her life that have been around a long time, her husband and her home.

"I've lived in this house since 1966," she said.

To protect her home, Lane says she and her late husband kept it insured with one of the biggest companies around.

"We went with State Farm 55 years ago," she said. "It was the first insurance we bought."

Fifty-five years with State Farm, it was almost as long as she was married to her husband before he passed away.

"We kept it for 55 years and we also had the same insurance agent for the same length of time," she said.

And Lane says State Farm was always there when she needed the company.

The most recent occasion was last year when her hot water heater broke and flooded her home.

"When we came home, we had been gone three days and the water was pouring out the front door, it had leaked out the back door, it was a mess," she said.

But after State Farm took care of the claim, Lane says she got a letter recently from the insurance giant saying, "We are sorry we cannot continue your insurance. Therefore your policy will not be renewed."

After 55 years of being with State Farm Insurance and after having a total of only three claims all those years, Lane says she feels like she was being kicked to the curb.

"Is State Farm really a good neighbor? We had been loyal all of these years and this is where loyalty ends," Lane said.

3 On Your Side contacted State Farm which tell us under certain circumstances they have the right to cancel insurance policies.

However, after 3 On Your Side asked State Farm to look into Lane's cancellation, they wrote, "...we decided we will offer to renew her policy."

It's great news to Lane, who says after being with a company for 55 years she shouldn't have to start shopping for insurance now.

"I'm very happy with the way Gary Harper and his crew have worked to get this situation resolved," Lane said.

State Farm Company Statement:

"We appreciate the loyalty Mrs. Lane has shown State Farm over the years, and we have decided we will offer to renew her policy. As a mutual insurer, our obligation is to all of our customers. That's why we have a responsibility to periodically review the number of claims being made on a policy and likelihood of further claims. Sometimes that means we have to make the difficult decision to non-renew a policy in order to keep premiums affordable for all our customers. However, to be as fair as possible, we also look at the unique circumstances of each policy. In this particular case, we have been evaluating Mrs. Lane's policy over the past few months and the impact of a claim that occurred in March 2009. Further review of the specifics surrounding that loss prompted our decision to offer to renew her policy."

Tips to avoid getting dropped by insurance:

· Keep your home maintained and in good repair.

· Keep your deductible high.

· Pay for the smaller repairs and expenses.

· Think twice about water-related claims. Experts say a single report of water-related problems may be enough for insurers to shun your home.

· Don't tell your insurance company about problems unless you're going to file a claim.