Allstate to Seek Additional Auto Insurance Rate Increases

Allstate CEO Tom Wilson told investors during the company’s February 8 Fourth Quarter 2024 earnings call that the company plans to pursue further rate increases in its auto insurance business this year.

In December 2023, Allstate received approvals for rate increases in California, New York and New Jersey.

“Since 2022, the Allstate brand implemented rate increases of 33.3%, which included 16.4% in 2023 and 6.9% in the fourth quarter, driven by the recent approvals in California, New York and New Jersey,” Wilson said.

“National General implemented rate increases of 10% in 2022 and an additional 12.8% in 2023. Looking forward, we will pursue rate increases in 10 states to improve margins and in other states to keep pace with increases in loss costs,” he said.

Allstate acquired National General in January 2021 for $4 billion.
According to Wilson, Allstate began expense reductions in 2019 as part of its transformative growth plan to become a low-cost provider of protections. Being early in that effort helped offset the rapid inflation in loss costs.

The company reported total revenues of $14.8 billion in the quarter and an 8.7% increase, or $1.2 billion, compared to the prior year’s quarter. Full-year 2023 earnings came to $57 billion, an 11.1% increase over the year before.

The auto insurance segment earned $8.6 billion in the quarter, a 10.7% increase over the prior year’s earnings of $7.7 billion. Full-year 2023 revenue from auto insurance totaled $32.9 billion, a 10.9% increase from the year-ago period.

The company’s Allstate brand auto insurance brought in $7 billion, while National General generated $1.5 billion.

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