Beginning in June some residents of Mississippi could see their homeowners insurance rates go up. The state Insurance Commissioner has been in negotiations with Allstate Insurance Company for almost a year and a half, before the two reached an agreement.
In 2006 Allstate was given the ok to raise rates in Mississippi by 29 percent, with three of the counties considered coastal being raised by 90 percent. In 2008 they petitioned for another rate increase and were given approval for a 14 percent statewide average increase.
When Allstate filed for another increase of 44 percent in late 2009, Mike Chaney, the state Insurance Commissioner, said, “No.” He rejected the request, and the two have been at a stand-off since then. Chaney said he would not approve anymore increases that pertained to specific areas of the region; he would only consider statewide proposals; from any insurer.
Allstate had initially wanted to raise rates 65 percent when Chaney denied their request. The insurer says that it had seen increasing losses, with no recent rate increases to help cover those losses. They provided the state Commissioner with multiple actuarial reports that showed justification in their request for an increase.
In recent negotiations Allstate let the Commissioner know that if a deal couldn’t be reached for an increase of at least 44 percent, they planned to drop over 18 thousand Mississippi homeowner policies. After much deliberation and negotiating the two reached a deal.
Chaney approved an increase of 19 percent, and Allstate agreed to drop only (not renew) around five thousand policyholders, with no more than about 150 from counties considered coastal areas. Allstate also agreed to give any homeowners who moved their auto insurance to them a 25 percent discount for multi-line policies.
