Allstate Settles With Florida Homeowner Rate Cut
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Florida and Allstate Insurance have settled their differences and the news is good for consumers.
The Northbrook, Illinois company is giving Florida homeowners an additional 5.6 percent rate cut, as part of a settlement. That means homeowners can expect a 19.8 percent homeowners cut in rates since June of last year.
The insurer will also offer coverage to 100,000 more Floridians against hurricanes and other perils, pay a $5 million fine, and forgive a $175 million loan to its Florida subsidiaries.
This follows allegations that Allstate violated state law in claims handling and failed to cooperate with property insurance investigators looking into a proposed rate hike of more than 40 percent. Insurance Commissioner Kevin McCarty had prohibited Allstate from writing any new policies in the state for all types of insurance.
Allstate has two million auto and property insurance customers in Florida and 250,000 homeowners’ policies which will be affected by the rate reduction. The agreement to provide more insurance to homeowners and condo owners is important because Allstate had been trying to leave the state following hurricane damages tallies from previous years.
A survey from the American Association for Justice (AAJ), an organization of attorneys with experience in handling insurance claims, found that Allstate led the list of companies with the least consumer friendly policies in settling insurance policies.
The group issued its report after sorting through thousands of legal documents, financial filings, as well as complaints filed with state insurance departments.
They were looking for how often claims were paid and how often the company employed hardball tactics against policyholders such as a "take-it-or-leave-it" offer.
Every year, insurance claims are denied by the very companies that promised to protect consumers, who pay their premiums, in case of a serious accident or catastrophic event. When an insurance company wrongfully denies a legitimate claim, this is known as "insurance bad faith" and it's more common than you may think.
Bad faith insurance companies can usually eventually be shown the light by an experienced attorney who has worked with them before, many of whom have experience on the other side of the insurance fence.