By Becky Yerak | Allstate Corp. is making several changes to its Illinois insurance prices, including raising homeowners’ rates by an average of 8 percent this July and offering 5 percent auto-rate discounts to Geico policyholders who switch to the Northbrook-based insurer.
Allstate also recently began offering discounts of 7 percent to auto customers who pay their bills in full, as well as five new deductible options for auto customers.
Allstate has been the nation’s No. 2 auto insurance writer, with $17.4
billion in direct premiums written for the year ended June 30, according
to SNL Financial.
But Allstate’s were down 4.6 percent for that period. Meanwhile,
Berkshire Hathaway Inc.’s No. 3 Geico had $13.1 billion, up 8.1 percent.
On Monday, Allstate, trying to create more incentives for consumers to
give them both their auto and homeowners business, also began offering
deeper “preferred package” discounts, a break for consumers who have two
cars and a residence. Those discounts will be up to 15 percent for
auto.
“Although homeowners rates will increase between $67 and $82 a year, and
$6 to $7 a month on average, with the new and deepened discounts
Allstate is introducing, current homeowner customers that don’t have
their auto with Allstate can get discounts of up to 54 percent (on auto)
by bringing their auto to Allstate,” spokeswoman Shaundra Turner said.
The 54 percent applies if policyholders meet certain criteria, including
if they use EZPay and pay in full.
Allstate said if qualifying Geico policyholders come to Allstate,
they’ll get an immediate 5 percent discount on what Allstate would have
originally charged.
Allstate said it’s raising homeowner rates because of a number of
factors, including the increase in the instances and severity of
homeowners’ claim losses.
Geico couldn’t be reached for immediate comment.
Remember, you got good hands in your pockets with Allstate.
I switched to Allstate and paid my premiums in full upfront. I received a letter a week later stating I had to cut down my trees. The three hundred dollars I had saved by switching was suddenly not such a good deal after all! I immediately switched to State Farm and was told there is nothing wrong with my trees. They have no idea why Allstate wanted me to cut them down.
All I needed was a reason! Switching from Allstate to another auto insurer is already saving me $304 over the next 12 months. Though I hadn’t had an accident in 10 years, my premiums increased every 6 months. I gave them a chance to match the savings — my agent never even called me back!
Guess who’ll be switching homeowner’s insurance this year, too!
Are Illinois people being punished for claims from other states? I use State Farm for home and auto.
Well, State Farm beat Allstate to the punch by raising my rates nearly 10% last year. The irony is that homes in my neighborhood, including mine have declined by 25% in value. Go figure. Insurance companies are as crooked as Wall Street bankers.
This stuff happens, we have to deal with it. Fact is, midwestern states had freakishly high storm losses over the past few years that have driven up rates. It’s happening at your local mutual company just as it’s happening at the big, scary public companies.
Also, though the part they won’t say, is investment outlooks are very mediocre for the near to mid-term. With rates expected to rise in the future current asset holdings are not expected to generate much investment income at all. So they need to generate profit elsewhere, and that comes from underwriting methods, aka increasing rates.
As a knowledgeable consumer you are free to go elsewhere.
State Farm does the same thing
keep in mind even though VALUES are down the cost of materials to rebuild you home is not…..The value also is 25% land 75% home…No insurance company will pay for burnt grass or trees….try to find a company without shareholders ….Like AAA and others…The dont need to make such a profit, for the greedy
God forbid an incurance company make a profit. Where does the money to pay claims come from. With the stock market in the tank and the government so far in debt to bail out anyone else you better hope you insurance company makes some profit or when the next cat hits your area they make send you an IOU.