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Allstate to Raise Homeowners Rates in IL

Source: Chicago Tribune

Posted on 28 Apr 2010

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Allstate Corp. is raising Illinois homeowners insurance rates by an average of 8 percent in July and offering 5 percent auto-rate discounts to Geico policyholders who switch to the Northbrook-based insurer.

Allstate also began offering discounts of 7 percent to auto customers who pay their bills in full, as well as five new deductible options for auto customers.

Allstate is the nation's No. 2 auto insurance writer, with $17.4 billion in direct premiums written for the year ended June 30, according to SNL Financial. But those premiums were down 4.6 percent for that period. Meanwhile, Berkshire Hathaway Inc.'s No. 3 Geico had $13.1 billion, up 8.1 percent. State Farm is No. 1.

On Monday, Allstate, trying to create more incentives for consumers to give them both their auto and homeowners business, also began offering deeper "preferred package" discounts, a break for consumers who have two cars and a residence. Those discounts will be up to 15 percent for auto.

"Although homeowners rates will increase between $67 and $82 a year … with the new and deepened discounts Allstate is introducing, current homeowner customers that don't have their auto with Allstate can get discounts of up to 54 percent (on auto) by bringing their auto to Allstate," spokeswoman Shaundra Turner said.

The 54 percent applies if policyholders meet certain criteria, including using EZPay and paying in full. Allstate said if qualifying Geico policyholders come to Allstate, they'll get a 5 percent discount on what Allstate would have originally charged.

Allstate said it's raising homeowners rates because of a number of factors, including the increase in the instances and severity of claim losses.

Geico couldn't be reached for immediate comment.