Fires, Weather Prompt Allstate to Seek Rate Hikes in Texas

NU Online News Service, Dec. 21, 1:33 p.m. EST

Allstate insurance companies have requested rate increases for homeowners’ insurance in Texas due to the “risks and realities of weather patterns in Texas,” a spokeswoman says.

Allstate Texas Lloyds has asked for a 5.7 percent average statewide increase. Allstate Fire & Casualty Insurance Co. is seeking approval for a 9.8 percent rate hike.

Texas is a file-and-use state, so the rates are currently in effect. Insurance regulators are reviewing the request.

Allstate spokeswoman Kristen Beaman says the rate request is “driven by loss costs, which are outpacing premiums.”

“Texas has the most severe weather in the country,” Beaman points out in an email. “Hail and windstorms have been increasingly severe over the past few years and severe drought conditions have increased the frequency and scope of wildfires.”

Allstate reported losses of $1.1 billion from the 2011 third quarter, when large wildfires burned in Austin and Houston. Wildfires were included as part of 23 catastrophic loss events during the quarter, which also saw losses from Hurricane Irene and Tropical Storm Lee, Beaman says.

Due in no small part to catastrophe losses, Allstate Corp. reported third quarter net income of $165 million, a 55 percent drop compared to the same period in 2010.

The Insurance Council of Texas says wildfires this year could cause insured losses of around $500 million. This year Texas was victimized by the costliest and second-costliest fire in state history.

The costliest, the Bastrop fire, is now expected to cause $325 million in insured losses.

Comments

Resource Center

View All »

Get $100 in leads with $0 down!

NetQuote's detailed, real-time leads have boosted sales for thousands of successful local agents across the...

The Growing Role of Excess & Surplus Lines in Today’s...

The excess and surplus market (E&S) provides coverage when standard insurance carriers cannot or will...

Increase Sales Conversion with this Complimentary White Paper

This whitepaper will share proven techniques - used by many of the industry's top producers...

D&O Policy Definitions: Don't Overlook These Critical Terms

Unlike other forms of insurance where standard policy language prevails, with D&O policies, even seemingly...

Environmental Risk: Lessons Learned from Willy Wonka and the Chocolate...

Whether it’s a chocolate factory or an industrial wastewater treatment facility, cleanup and impacts to...

More Data, Earlier: The Value of Incorporating Data and Analytics...

Incorporating more data earlier in claims lifecycles can help you reduce severity payments by 25%*...

How Many Of Your Clients Are At Risk Of Flood?

Every home is vulnerable to flooding. Learn four compelling reasons why discussing flood insurance with...

Gauging your Business Intelligence Analytics Capabilities and the Impact of...

Big Data, Data Lakes and Data Swamps, How to gauge your company's Big Data readiness....

Extending Contact Center Capabilities Across the Insurance Enterprise

Today advancements in technology are making a big impact on business and society. To yield...

Drug and Alcohol Testing Requirements

In this two-part series, NBIS Risk Management team will break down the requirements to assist...

Personal Lines Pro eNewsletter

Critical insights into the personal auto, homeowners, and other consumer insurance markets to help P&C professionals stay informed – FREE! Sign Up Now!

Advertisement. Closing in 15 seconds.