New rates will be put into effect this month, according to the CFO.
In the states of California, New York, and New Jersey, Allstate has been granted permission by regulators to raise vehicle insurance premiums.
The insurer’s chief financial officer, Jess Marten, announced premium increases of30%,14.66%, and 20% across the three states starting in December and continuing through February 2024.
Marten estimates that these rates will add around $1 billion to Allstate’s yearly written premiums, furthering the company’s strategy to boost profitability.
The premium impact of 11.4% was reported by Marten as a result of the auto insurance rate hikes implemented by Allstate since the beginning of the year. Consequently, the insurance behemoth anticipates a growth of almost $2.97 billion in annualised written premiums.
At the same time, expected annualised written premiums for Allstate brand homes insurance increased by around $1.03 billion, a rise of 10.1%.
According to Marten, the average gross written premium for homeowners insurance increased by 12.6% from the previous year due to a combination of factors including the surge in enforced rate hikes and inflation in covered property replacement costs.
Allstate also revealed that its expected catastrophe losses for November were below the $150 million reporting threshold, in addition to providing updates on its enacted rates.
October was the last time Allstate disclosed its monthly disaster loss estimate. At that time, the company said that September’s losses were estimated at $317 million, or $250 million after taxes.
It followed the insurer’s second-quarter financial results, which showed an adjusted net loss of $1.2 billion.
To better serve customers, provide opportunity for the Allstate team, and generate attractive returns for shareholders, Allstate will improve results while establishing an upgraded business model,” stated Allstate CEO Tom Wilson in August.
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