By Iman Palm, KTLA 5
https://ktla.com/news/california/allstate-seeks-to-raise-homeowners-rates-by-34-sparking-controversy
Allstate, one of California’s largest insurers, (opens in new tab) wants to raise its homeowners’ rates by an average of 34%, which could be the largest increase this year.
The rate hike would impact more than 350,000 policyholders if approved by the Department of Insurance, according to the San Francisco Chronicle. (opens in new tab)
Allstate is the state’s fourth-largest property and casualty insurance provider, representing about 5.5% of the overall market as of last year, according to the Department of Insurance.State Farm to non-renew 72,000 policies in California: These zip codes will be impacted the most
Last year, Allstate filed for a 39.6% rate increase and, in January, amended its request to 34.1%, according to the insurance department.
The latest rate increase request is being challenged by the Los Angeles consumer advocacy group Consumer Watchdog, demanding the insurer provide more data.
“Allstate is using secret algorithms to decide whether homeowners are at high risk of wildfire and how much they will pay. We’re pushing the company to explain that pricing and disclose to consumers exactly what is raising their premiums,” Carmen Balber, president of Consumer Watchdog, told the Los Angeles Times. (opens in new tab)
Allstate’s rate hike request comes after State Farm requested a similar price hike late last month.
State Farm General, the company’s California subsidiary, hopes to raise rates by 30% for homeowners, 36% for condo owners, and 52% for renters, (opens in new tab) on average.2 more insurance companies announce plans to leave California
Both Allstate (opens in new tab)and State Farm (opens in new tab) announced last year that they would stop accepting new property insurance applications.
The state doesn’t require potential homeowners to have insurance; however, many mortgage lenders may require some proof of insurance (opens in new tab) as a loan condition.
