Monday, 14 May 2007
Allstate Homeowners Insurance Leaves California
In a recent announcement, Allstate said they would no longer offer homeowners insurance or landlord package policies in the state of California.
The nation’s largest publicly-held individual insurance company explained their decision was in effort to reduce risk.
They have made a series of attempts to reduce their risk in California — including increasing the amount of defensible space around wildfire risk homes to 200 feet, and mandated gas shut-off valves for homes near active fault-lines.
Consumer advocate groups say Allstate’s decision is good for California homeowners.
“Allstate has been making outrageous profits on its California homeowners business in recent years. Allstate can’t bully California into accepting outrageously high rates by threatening to take their coverage and go home,” said Carmen Barber, who is a spokesperson for the Foundation for Taxpayer and Consumer Rights.
Policyholders who currently have Allstate as their homeowners insurer won’t be affected by the departure. But Insurance Commissioner Steve Poizner issued an Order to Show Cause to protect current members against unfairly increased rates.
“Allstate’s decision to not accept new business does not entitle them to charge excessive rates,” said Poizner.
“In the coming weeks, the Department of Insurance will be watching Allstate’s actions very closely to ensure that consumers are protected, and that Allstate fulfills its contractual obligations to its customers,” he added.
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