State Farm's policy freeze could make it harder and harder for families to buy and sell homes on the coast.
Just ask Kurt Appel. He'd like to move. But, he can't find a buyer who can get affordable insurance. For now, Kurt Appel's home phone is in Gulfport's Park Place subdivision. However, that line could be disconnected.
"We have an offer on another home predicated on selling this house," Appel said.
About six months ago, the family put a "for sale by owner" sign in the front yard. When nobody took the key out of the lock box to tour the home, the Appels turned their sales pitches over to a realtor. Yet Kurt Appel says his family hasn't gotten a single offer.
"The cost of insurance is just knocking everybody out of the market," he realized.
You don't have to tell that to Gulfport realtor Andy Sawyer.
"We need insurance people to stand up and say, 'Yes, you're hurt. We're going to take of you, pay the policy and make it stand up,'" Sawyer said while sitting in a trailer he's using for his downtown Gulfport office.
Instead, State Farm executives in Illinois just announced that starting Friday, they would stop writing homeowners policies in Mississippi. Sawyer said that while skyrocketing insurance rates since Katrina are hurting homebuyers' pocketbooks, he doesn't think State Farm's decision to freeze what it covers in Mississippi will have much of an impact on overall home sale numbers.
"But it will affect the cost of buying. And it's going to slow down the market," Sawyer said.
If that happens, Kurt Appel's family may have to stay in Park Place.
"It's almost like the final nail in the coffin, at least for the time being, until something gets resolved," Appel said.
Because of State Farm's edict, company officials say out-of-state policyholders who move to Mississippi after Friday cannot transfer their homeowners insurance to the new property.