Member access

4-Traders Homepage  >  Shares  >  Nyse  >  The Allstate Corporation    ALL   US0200021014

SummaryQuotesChart AnalysisNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll news 

The Allstate Corporation : Allstate : Rivals Now Joining Us In Raising Home Insurance Rates

05/03/2012 | 11:16am US/Eastern
   By Erik Holm 
   Of  
 

Allstate Corp. (ALL) executives said rivals are beginning to raise U.S. home-insurance rates, joining Allstate in an effort to offset rising claims costs.

Allstate has been boosting the price of coverage for years as severe weather pushed the company to repeated underwriting losses in its home-insurance operation.

But several analysts on Thursday highlighted the company's first-quarter profit margins, saying the company appeared to be closing in on its goal of achieving appropriate returns from the segment.

The underlying profit margin in the home-insurance business, a measure that excludes some effects out of the company's control, was 33 cents on the dollar in the quarter.

Competitors "are now raising their homeowners rates a little later than I think we did," said Matthew Winter, the head of Allstate's home and auto operations. "My expectation is that we will no longer be alone in the marketplace taking rate."

Allstate shares rose 4.1% to $34.26 in morning trading after the company released first quarter results late Wednesday. The stock jump came after the improved home-insurance results helped push first-quarter profit up 46% to $766 million. Operating income of $1.42 a share beat the consensus estimate of analysts surveyed by Thomson Reuters by 30 cents.

Allstate's efforts to raise home-insurance rates continue, which has had a "chilling effect" on the company's auto-insurance division, Winter said. The company is "accepting, but not liking" the knock-on effect, he said.

"Growth in the absence of profitability is the wrong strategy," he said.

Some of the recent price hikes have reflected the rising costs of repairing roofs, which increased dramatically in 2011, Winter said.

-By Erik Holm, Dow Jones Newswires; 212-416-2892; erik.holm@dowjones.com

Latest news on THE ALLSTATE CORPORATION
1d agoTHE ALLSTATE CORPORATION : quaterly earnings release
2d ago ALLSTATE : Investments Expands its Senior Leadership Team
3d ago ALLSTATE : Royce Williams Featured in New Allstate Agent Highlight Video
4d ago ALLSTATE : Posts September Losses
10/17 ALLSTATE : Distracted Drivers Lack Focus Near California Schools
10/17 ALLSTATE : Protect it or lose it
10/16 ALLSTATE : World's Largest Youth Empowerment Event – We Day – Comes ..
10/16 ALLSTATE : Announces September and Third Quarter Catastrophe Loss Estimate
10/14 ALLSTATE : Investments Expands its Senior Leadership Team
10/08 ALLSTATE : Center Against DV Raised $5,100 for Domestic Violence in Allstate Fou..
Advertisement
Chart
Duration : Period :
The Allstate Corporation Technical Analysis Chart | ALL | US0200021014 | 4-Traders
Income Statement Evolution
More Financials
Dynamic quotes  
ON
| OFF