Allstate Will Most Likely Blame Katrina To Drive Up Insurance Rates
Chicago, IL – Most Allstate Corp. customers living in areas hard-hit by hurricanes and other natural disasters are likely to see their premiums rise this year as a result of the insurer’s costly new reinsurance obligations, the company claimed last week. This is most likely to result in higher premiums for everyone involved, although Allstate Corp. has been heavily denying settlements for all mold victims.
Allstate, the second-largest personal-lines insurer behind State Farm in the nation and in Louisiana, claimed that contracts taking effect in 2006 will triple the cost of its reinsurance to about $600 million a year. This is nowhere near the amount of settlements they have paid out, denying a vast percentage in choice of costly litigation over paying out reasonable settlements.
“We will aggressively seek to include reinsurance costs in our premium rates in order to mitigate the impact of this increase,” claims Thomas J. Wilson, president and chief operating officer. Its reinsurance programs include nationwide catastrophe coverage for tropical storms, hurricanes and earthquakes and related fires, as well as for excess losses from fires in California.
Allstate also claims it expects to increase its coverage limits in New Jersey and Texas by $100 million, and that it is considering as much as $300 million of additional reinsurance for catastrophe losses in New Jersey. This is a gross travesty to justice, in states where insurance lobbyists have fought hard to reduce, and sometimes blatantly deny claims where victims are left with little to no recourse.
The company also plans to terminate its agreements in North Carolina and South Carolina. Many experts speculate that this is due to accountability and liability claims. Premiums are likeliest to rise in hurricane and earthquake-prone regions as Allstate passes along the risk and higher costs of recent disasters to consumers. This is a clear cause for maximizing profits and reducing costs.
“There’s no getting around the fact that we’re incurring higher costs for the insurance protection that we’re providing. And unfortunately the consumer is the ultimate bearer of those costs,” claims Michael Trevino, a spokesman for the Northbrook, Ill.-based insurer, in a marketing campaign to clearly make the insurance companies look like the victims as benefiting from denied claims. “We believe the risks are rising so the costs of protection against those risks are also going to rise,” he claims.
It had catastrophe losses of $3.06 billion, of which $2.39 billion was from Hurricane Katrina and $553 million from Hurricane Rita along with smaller amounts from Dennis and Ophelia.
Mold Help requests the public to inform us if a hurricane victim was actually paid on a valid claim without litigation. We will inform you if anyone comes forward with their story to prove that the insurance companies are being as forthright as they appear.
Mold Help receives hundreds of complaints from claimants who so far, not received nothing for their loss of housing, work and health due to mold related problems as insurance companies constantly deny ensuing loss and liability in their quests for coverage that they thought they had paid for during numerous years of home ownership.
Author: Carolyn Willbanks
