Allstate Clarifies Rate Reduction Filings to Insurance
Coastal Policyholders Included in Reduction Scenario
From: Office of State Insurance Commissioner Filed
Commissioner of Insurance George Dale announced today Allstate has
clarified their reduction rate filing that will essentially offer nearly
60% of their 72,000 Mississippi policyholders significantpremium
reductions or savings.
"Allstate and the Mississippi Insurance Department have worked together to
clarify the filing and I am satisfied with their clarification. They now
have the structure in place where policyholders, especially those in the
coastal counties, can receive up to a 20 to 25% premium reduction in their
rate increase," said Dale.
Dale was unhappy with the amount of premium reductions for policyholders
in the original filings. Instead of approving the 282% rate increase for
the six coastal counties originally requested, Dale's office got Allstate
to agree to cap renewal rates at 90% in Hancock, Harrison, and Jackson
counties and 80% in George, Stone and Pearl River Counties.
Any Allstate policyholder across the state, including those on the
Mississippi Gulf Coast, will have the option of reducing the amount of
their new premium based on their choice of deductible. With the rate
change, many customers who have already chosen a higher all-perils
deductible (which does not include such things as flooding and storm
surge) will see a decrease in their premium, with an average rate
reduction of 4.8%. Approximately 60% of Allstate's current policyholders
still have an all-peril deductible of $500 or less, but can choose between
$1,000, $2,500, or $5,000 deductibles which will substantially reduce
their new rate.
For example, a policyholder (statewide) going from a $250 deductible to a
$500 deductible will see a premium discount credit of up to 12%, and a
policyholder going from a $250 deductible to a $1,000 deductible earns up
to a 25% premium discount credit. A policyholder going from a $100
deductible to a $500 deductible will see a premium discount credit of up
to 27% and a policyholder going from a $100 deductible to a $1,000
deductible will receive an up to 40% premium discount credit. Note that
rates may vary depending upon the deductible chosen and location.
For policyholders in non-coastal counties that had wind coverage, Allstate
will renew that coverage. In addition, for policyholders in coastal
counties that had wind coverage removed and are choosing to rebuild after
significant Katrina damage, Allstate will rewrite wind coverage if that
policyholder rebuilds to International Building Codes that include
hurricane mitigation factors such as those recommended by groups such as
the Institute for Business and Home Safety (IBHS).
"I will say again, that premiums are still much too high for everyone on
the Mississippi Gulf Coast and this department will continue to work with
companies to find ways to help reduce those rates and find more companies
willing to write policies on the coast. We hope to continue to see the
market continue to move and stabilize toward more pre-Katrina conditions.
For now I am comfortable with these steps toward that goal, but again,
will continue to work with more and more companies in finding some relief
for Katrina victims," said Dale.