Allstate Investigated for Conspiracy
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Allstate Insurance Company has been asked by the governor to turn over internal documents to determine if it and other property insurors are conspiring to keep prices high.
Allstate and its subsidiary, Allstate Floridian Insurance, have been served subpoenas. Just three weeks ago, Allstate Floridian, the fourth-largest insurance company in Florida, proposed raising homeowners rates by 41.9 percent.
At issue- are the insurance companing passing along to consumers the discounts they are receiving by being allowed to buy cheaper backup coverage from a state catastrophic fund.
Needless to say, Allstate is not happy equating the subpoena to a witch hunt.
Allstate is not alone. State Farm Florida also received a subpoena in August but decided to settle with the state--dropping plans to change policies for 50,000 homeowners and giving consumers more generous cuts of 9 percent, rather than 7 percent State Farm had wanted.
Why is this happening? Governor Charlie Crist suspects the insurance companies are not playing fair.
The insurance industry is tenacious. They are greedy, and they are working hard, and they are skilled," Crist said. "So we have to be just as tenacious and work as hard."
In response insurance trade groups say they might pull out of Florida. Allstate says it has confidence in its business model Hearings are set for January 15 and 16th in Tallahassee.