A warning for Allstate insurance customers – you may be soon victim to sticker shock.
The insurance company giant is implementing rate hikes on some of its policies of up to 58.3 % – a huge increase. But the Georgia Department of Insurance is trying to fight back to keep this from happening.
Insurance Commissioner Ralph Hudgens told 11Alive’s Kaitlyn Ross Monday the announcement really came out of nowhere. He says he's been at the job for six years and has never seen anything like it.
“(It’s) massive,” he said. “And Allstate insures 11 percent of the autos."
Hudgens says Allstate didn't wait for his approval – or even ask for it. He says the normal process for insurance companies in the state is to come to his office with a proposal, and then they'll meet somewhere in the middle.
“They say, ‘We need 15,’ and we say, ‘We'll give you eight.’” This time, Allstate just told them about the rate hike and walked away. “I can't imagine that they would not come in to us and discuss this,” Hudgens said.
In a statement, Allstate told 11Alive News they considered the rate increase carefully, and it will impact less than half of their customers in Georgia. But Hudgens says his agency exists to make sure consumers are protected – and Allstate moving forward with this hike without going through the process is unfair.
Hudgens has now issued a consumer alert to give drivers a heads up if they have Allstate, and says they should consider if they want to keep it. He recommends looking at the competition to get a competitive rate.
The Department of Insurance has now commissioned an actuarial study to see if this rate increase is really necessary to cover Allstate’s costs. It will take about a month to complete, but if the independent reviewer finds the increase is unnecessary, they could force the company to repeal the rates.
Read Allstate's statement in its entirety:
By offering a broad range of innovative protection options, Allstate provides strong value to our customers. We adjust rates very carefully to charge properly for the risk we assume and ensure our ability to protect customers from life’s uncertainties. This particular rate filing applies to one of Allstate’s three underwriting companies in GA and represents less than half our auto insurance business in the state.
We work closely with state departments of insurance whenever we adjust our rates, and look forward to a continued dialogue with the Georgia Department of Insurance. As is industry standard, changes in market conditions require that we set rates that are adequate for the coverage we provide. Increases in the number of miles driven, the amount of traffic fatalities, and the costs associated with repairing vehicles have caused the insurance industry to experience a significant increase in both the number of claims received as well as the cost associated with settling these claims.We encourage all our customers to regularly consult with their Allstate agent about the most appropriate coverage and available discounts for their particular circumstances.