Industry News

Allstate rejects California’s push for rate reductions

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Allstate will stop writing new homeowners and landlord insurance policies in California as of July 1, the company announced Thursday, rather than join other companies that have heeded a push by regulators to slash rates by $1 billion. Allstate said that while it will continue to provide coverage to existing property insurance customers in California, its agents will refer customers seeking new policies to another company, Pacific Specialty Insurance Company, not affiliated with Allstate. In a press release, Allstate noted that it filed a request with state regulators in September for a 12 percent rate increase, which is still pending. The request for a rate increase flew in the face of an order by California Insurance Commissioner John Garamendi for Allstate, State Farm, Farmers and Safeco Insurance to justify their rates after a study concluded the companies paid out less than 50 percent of homeowners insurance premiums on claims. In December, the state's second-largest homeowners i...