Ratewatch: Allstate to Raise Rates in Mississippi
According to the Mississippi Insurance Commissioner, Mike Chaney, Allstate customers in that state will be seeing a 19.4 percent increase in their homeowners insurance rates. The increase is likely to happen in June, and apply to both renewals and new policies.
For nearly two years, Chaney has been in negotiations with Allstate about the size of this increase, which, when filed, was a ridiculously high 65 percent. That increase, along with the reduced request for a 44% rate hike, was rejected.
In 2006, after Hurricane Katrina, then-Insurance Commissioner George Dale approved Allstate’s request for a 29.5 percent increase which also came with a 90% increase in the state’s three coastal counties. That rate-raising was followed by a 14 percent hike approved by Chaney in 2008, though that was an average, and coastal homeowners actually saw their insurance go up by about 40 percent at that time.
Then, in late 2009, Chaney declared that he would only accept rate increases that were proposed statewide, rather than those broken down by property zone (i.e. inland vs. coastal locations).
In the most recent negotiations, Allstate threatened to drop 18,000 policyholders from their book of business unless the 44% increase was allowed, but after more back-and-forth, the insurer agreed to drop only 5,000 policies in Mississippi, no more than 150 of which are in coastal locations, and then only after a year passes.
A representative of Allstate said that any homeowners insurance customers who also have (or move) their auto policies to Allstate will not be dropped, and will also receive a 25% discount, which is ten percent more than the previous discount of 15%.
In a statement to the press, Chaney said, “This has been a painstaking process, and as commissioner, I worked diligently to negotiate the requested rate down to a 19.4 percent increase to the policyholder. I earnestly believe I have arrived at the most equitable solution possible, while carefully balancing the percentage of increase granted with the number of non-renewals by Allstate throughout the state.”