The Good Hands insurer swam against the premium-reduction current last year but is changing directions.
Last year, Allstate car insurance rates didn’t experience the same reductions as many other national auto insurers were offering in 2020. Many insurers made their coverage cheaper to reflect the reduced driving trends resulting from the pandemic.
The national auto insurer recently announced that it was changing directions with its premiums.
Allstate car insurance rates are being cut in a number of large states across the country. In this way, the insurer is joining Progressive, State Farm, and many others that have been reducing the cost of their coverage throughout the pandemic. The Northbrook, Illinois-based insurer was resistant to this strategy last year, but CEO Tom Wilson decided that this year would be moving in a new direction.
This represents the first time in the fourteen years since Wilson took the position as CEO that Allstate will start grabbing onto market share in the auto insurance business, in which there is massive competition. The insurer will be cutting the rates paid by drivers in Illinois by an average of 5 percent.
The reduced Allstate car insurance rates will become effective as of February 18.
The date from which the changes in premiums will take place were included in the Illinois Department of Insurance filings. Among the other states in which drivers will be seeing a rate cut of that size are Pennsylvania and Wisconsin. Motorists in Georgia will see the largest average savings, with a reduction of 8 percent. The remainder of the states receiving discounts will see around 5 percent, said a filing.
In the insurance company’s filings, the company stated that driving levels have grown again since the largest drop that occurred early in the pandemic in the spring of 2020. Still, miles driven remain 10 to 15 percent lower than they were before the pandemic started. As a result, auto insurers including Allstate have been seeing substantially larger profits because they aren’t paying as much in claims as they typically would.
Until now, driver savings provided through Allstate car insurance rates have been more cautious than has been the case among its rivals. As a new normal forms, the insurer is now changing the premiums calculations to reflect this trend.