Allstate accelerates rate boost in December; adds $5.4bn for 2024
US P&C market leader Allstate closed the year with a final round of rate increases, putting the estimated 2024 new premium tally from 2023 rate hikes at $5.4 billion.
In December, the Allstate brand implemented auto rate increases of 16.5% across 15 jurisdictions for a 5.0% uplift to the total brand premium, the strongest single month uplift noted throughout the 2023 rate hike endeavour.
The December gains follows recently secured rate hike approvals in California, New York and New Jersey of 30.0%, 14.6% and 20.0%, respectively.
For the full year, rate increases implemented for Allstate brand auto insurance had a premium impact of 16.4% and are expected to boost annualized written premiums by approximately $4.27 billion, CFO Jess Merten indicated.
Rate increases for Allstate brand homeowners' insurance bear a premium impact of 11.3% and are expected to raise annualised written premiums by approximately $1.16 billion, he claimed.
Allstate additionally confirmed expectations for a fourth quarter without notable cat losses, albeit then spoiling the effect with word of $198 million in negative prior period reserve development, chiefly from litigation in auto lines.
Total catastrophe losses for the fourth quarter were $68 million, pre-tax, more than confirming hopes generated after Allstate had said month by month only that cat losses had not crossed its $150 million reporting threshold.
But unfavourable prior year reserve developments, excluding catastrophes, came to a heady $199 million in the fourth quarter, with approximately $148 million related to personal auto, including costs for claims in litigation.
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