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Alabama's second largest insurer dropping thousands of policiesPosted On Tue, June 7, 2011
Approximately one in every six Alabama homeowners may be forced to find a new insurer when their policy runs out, according to the Associated Press.
The AP reports that one of Alabama's largest home insurance companies, Alfa Insurance, will be dropping 73,000 homes from their services over the next year and a half.
An attorney for the insurance group, Al Scott, told the news service that the move will primarily affect landlords who own more than one rental housing unit.
Jerry Newby, Alfa's president, told the AP that while some people may believe the recent storm that affected Alabama has hurt the company's bottom line, the insurer still has the resources to pay for homeowners' claims.
"While Alfa remains a financially strong insurance company, the increased frequency and severity of storms over the last decade have highlighted the need for Alfa to review its overall property portfolio.
An increased prevalence of claims can lead to home insurance rates rising, but industry experts say premiums are based on a variety of factors over a prolonged period of time.
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