Allstate releases its fiscal update for the second quarter of 2023

Allstate Releases Q2 2023 Financial Update | American insurance business

Insurance giant Points focuses on profitability and transparency

Allstate Releases Its Fiscal Update For The Second Quarter Of 2023

Insurance news

By Mika Pangilinan

Allstate released its financial update for June and the second quarter of 2023, detailing the impact of disaster losses and price adjustments on its business.

The insurance giant reported catastrophic losses of $1.01 billion for the month of June, with an after-tax impact of $799 million.

These losses include 18 accidents, estimated at $1.13 billion. Approximately 60% of the losses were related to the four wind and hail events, partially offset by favorable reserve reassessments related to the previous events.

For the entire second quarter, disaster losses totaled $2.70 billion before taxes.

Aside from the disaster losses, Allstate also disclosed unfavorable prior-year reserves estimates of $181 million during the second quarter, excluding disasters.

Within that amount, about $148 million was tied to the National General brand, primarily affected by personal auto injury coverage. In addition, approximately $31 million was associated with litigation activity in the state of Florida.

To improve profitability, Allstate said it raised auto prices by 11.6% across 12 locations in June. The move had an overall brand impact of 2.6%.

Allstate brand auto insurance saw a cumulative impact on premiums of 7.5% due to the rate increases implemented since the beginning of the year, according to Mertin. This is expected to increase annual written premiums by approximately $1.95 billion.

Meanwhile, the rate increase in Allstate-branded homeowners insurance resulted in a premium impact of 7.4%, which represents a projected annual increase in written premiums of approximately $754 million.

“Allstate continued to implement rate actions for auto and home insurance as part of our comprehensive plan to improve profitability,” said Merten. “Beginning with this month’s edition, we are expanding reporting transparency by disclosing homeowners insurance rates executed on a monthly basis.”

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