Allstate Companies Get Louisiana Homeowner Rate Hikes

Louisiana homeowners who get their insurance coverage from five companies owned by Allstate Corp. will start paying higher rates in either November or December.

Insurance Commissioner Jim Donelon recently approved rate increases ranging from 2.9 percent to 11.6 percent, depending upon which of the Allstate umbrella companies writes the coverage.

But Allstate spokeswoman Allison Hatcher said that up to 44 percent of the company’s customers who buy both auto and home coverage from Allstate stand to see an overall deduction. The new rate structure makes dual customers eligible for a reduced premium of up to 30 percent — an increase from the current 10 percent, according to Donelon’s order.

Northbrook, Ill.-based Allstate, according to state insurance department figures, insures just over 164,000 homeowners through its five companies. State Farm Fire and Casualty Co. is the state’s largest homeowner insurer with 301,000 policies. That company received an average 9.9 percent increase in May.

The 78,375 homeowners covered by Allstate Insurance Co. will pay, on average, 11.6 percent for homeowners-only coverage. The 78,793 homeowners covered by Allstate Indemnity Co. will pay 3.3 percent more.

The higher rates are effective Dec. 2.

Hatcher said the increases will mean about $150 more in annual premiums for each homeowner-only policyholder of Allstate Insurance and $40 per year for Allstate Indemnity Co.

Among the smaller Allstate carriers, Encompass Indemnity Co., with 1,929 policies, received an average 2.9 percent increase. Encompass Property and Casualty Co., which covers 871 homeowners, received an average 3.9 percent hike. Encompass Insurance Co. of America, with 3,418 policies, received an average 3.7 percent rate increase.

Those rates go into effect Nov. 11.

Rate increases are granted based upon actuarial models that project potential future losses and the reserves that will be needed to cover them. They are not based on past losses and how much was paid out for claims.

Topics Louisiana Pricing Trends Homeowners