The president of the National Association of Professional Allstate Agents (NAPAA) has called upon Allstate to make more broking services available to its exclusive agents where the company has decided not to write new policies or renew business.
Dale Revels, president of NAPAA, has called on the Northbrook, Ill.-based carrier to develop a brokering system, similar to what it has developed in Florida.
In response, company spokesman Mike Trevino said, "We are very supportive and are actively pursuing opportunities to have our agents serve as brokers for property insurance where Allstate has declined to write or not renew business."
Mr. Revels said in a statement to member agents: "As agency owners, we are constantly faced with challenges and change. This year will be no different as we have some major issues coming down the pipe that will affect agents in Texas, New York and several Western states.
"I am talking about the stoppage of new property business written through Allstate and earthquake coverage that is offered in states where earthquakes are a major risk," he explained.
Mr. Revels continued, "Ever since Hurricane Andrew in 1992, and then after the three that hit in 2003, agency owners in Florida have been able to use state-run Citizens Insurance to place property risks. And for the last two years, Florida agents have had seven different companies to broker new property business."
He said agents are working on a level playing field in Florida, and the same should be done for agents in other states affected by the company's decision to curtail its exposures.
In an interview with National Underwriter, Mr. Revels said he understood the company's need to make the decisions it has, but the company's agents still need to be taken care of and their books protected.
"Our agents need to look at brokering as an opportunity for sale potential and to make more premium," he said.
In New York, he said, there are few places for Allstate agents to turn. He hoped that at some point the state would create a risk transfer vehicle similar to Florida's residual market, Citizens Property Insurance Corp. Until then, agents need help finding alternatives.
In January, Allstate said it would stop writing property coverage in New York City, Long Island and parts of Westchester County.
Mr. Revels said the company is advising agents in Texas it plans to curtail some business there after this year's hurricane season. He said the company has already decided to stop writing earthquake endorsements in Washington, Oregon and California, but has arranged for the coverage to be assumed through a wholesale market.
"We can't change [Allstate's decision], but we need to look into brokering opportunities and find ways to treat all agents fairly," he said, adding that he felt the company is making some effort to help.
"I know it will be difficult for those agents on the coast," he said from his Florida office, "but we went through it and it has been successful."
Mr. Trevino added, "We are progressing with those [brokerage] arrangements." He said the company is seeking to replicate what it did in Florida in New York.
And the Allstate spokesman pointed to the company's recent fourth-quarter financial release where Allstate said it is seeking to reduce its hurricane and earthquake exposure and is searching for alternative markets for its agents to write the business.
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