28 Mar 2024
Thursday 14 February 2013 - 13:09
Story Code : 20256

State Farm invests in Iran-linked firms, California says

State Farm invests in Iran-linked firms, California says
State Farm Mutual Automobile Insurance Co. and units of Cigna Corp. are among insurers investing in firms that do business with Iran, California Insurance CommissionerDave Jonessaid.
An ING Groep NV unit also has Iran-linked holdings, according to a statement today from Jones. Insurers that operate in California have $198 million invested in firms that do business with Irans military, energy and nuclear sectors, down from about $6 billion in 2009 when California began pushing them to divest, Jones said.

The U.S. and European Union have placed sanctions on Iran, saying its working on nuclear weapons. PresidentBarack Obamasaid in his State of the Union address yesterday that the U.S. will do what is necessary to prevent the country from obtaining nuclear arms.

State Farms investments are in full compliance with all applicable laws and regulations, Bob Devereux, a State Farm spokesman, said in an e-mailed statement. While we respect the California Department of Insurances interest, we believe foreign policy and rules on foreign investments can be most effectively addressed by the federal government.

Policyholder-owned State Farm, based in Bloomington, Illinois, has an equities portfolio of more than $50 billion. The top holdings are International Business Machines Corp. and Exxon Mobil Corp., according to data compiled by Bloomberg. Cigna, the third-biggest U.S. health insurer by market value, had an investment portfolio that exceeded $23 billion at year- end, according to a supplement released this month.
No Lawbreaking
Californias identification of insurers with Iran-linked investments isnt meant to imply the holdings are unlawful, Jones said in a statement. The department cant force insurers to give up the holdings, and Jones declined to identify the investments or say how much each company holds.

Jones said at a press conference in Los Angeles that the Iran-related holdings are worthy of attention because insurers are making a risky investment.

Cigna has an investment inIndian Oil Corp., which is controlled by the Indian government and does business mostly within that country, according to an e-mailed statement fromMatthew Asensio, a spokesman for Bloomfield, Connecticut-based Cigna. Indian Oil has said that it does not knowingly engage in any dealings with anyone on the U.S. Treasury Departments list of banned people or countries, according to the statement. Asensio declined to give the size of Cignas investment.

Dana Ripley, a spokesman for ING, declined to comment.
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