Allstate falls to catastrophes: costly June events render $2.7bn Q2 bill

Natural catastrophes showed further signs of an outsized Q2 hit in the US, with market leader  Allstate admitting a rash of June events had pushed it to $2.7 billion in gross Q2 cat losses.

Allstate booked $1.13 billion in gross losses from 18 major events in June to bring the Q2 pre-tax tally to the $2.7 billion mark. Roughly 60% of the losses related to four wind and hail events

The Q2 tally came in 2.4 times larger than the prior year period, a loss-making quarter which Allstate had already bemoaned for "elevated catastrophe losses".

Allstate's jump in cat costs is running ahead of storm trends, leaving inflation-driven severity still presumably in the driver’s seat.

Total Q2 storm counts were down 8% year on year in the second quarter, albeit on a 29% rise in hail events, which rose to 38% of the Q2 total, storm data from the National Oceanic and Atmospheric Administration (NOAA) has indicated.

After prior period reserve adjustments, the June nat cat booking will come to $1.01 billion pre-tax or $799 million after tax.

But the larger PYD for the full second quarter will turn negative on $148 million in the National General brand primarily driven by personal auto injury coverages, and roughly $31 million related to litigation activity in the state of Florida, management said in its market filing.

Allstate became the second major carrier this week to admit to a catty second quarter following word that The Travelers had fallen to a Q2 net loss on the back of a $1.5 billion nat cat bill.

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