Allstate getting out of New York

[LSU2001]

Allstate lets go of more policies in New York
Allstate is pulling out of New York. Should investors pull out of the stock as its market share and premium growth take a hit?
By Shaheen Pasha, CNNMoney.com staff writer
February 6, 2006: 4:28 PM EST

NEW YORK (CNNMoney.com) - Faced with over $3 billion in claims from the barrage of hurricanes last year, Allstate is going on the defensive by pulling out of of high-risk markets as the industry prepares for increasingly severe hurricanes over the next two decades.

Allstate (Research) began to reduce exposure in hurricane-prone Florida in 2005, severing ties with 95,000 homeowners. But the country's largest publicly-held auto and home insurer, now has its eyes set on New York.

The company announced last month that it would stop writing new homeowners' policies in the New York region which includes the five boroughs, Long Island and Westchester. But starting this May, Allstate will also cancel an increasing number of policies each year once they reach the end of their three-year expiration period, said Allstate spokesman Michael Trevino.
Source:
http://money.cnn.com/2006/02/06/news/co ... /index.htm

I guess they watched "The Day After Tomorrow"
or maybe "It Could Happen Tomorrow"
Tim

[DoctorHurricane2003]

This is getting ridiculous. The government needs to subsidize the insurance industry and/or completely take it over.

JMO

[CajunMama]

No...the government does not need to get involved in the insurance industry.

[yzerfan]

If you want to see how well the government does when it runs its own insurance company, look at Citizen's of Florida. They're the state-backed insurer of last resort here, and while it's better to have a policy available than not have one at all, the organization is a mess and a half.

[Stephanie]

They also left NJ way back when during our auto insurance crisis. They acted like the child that couldn't get their way so they picked up their toys and left. They also thought the other insurance companies would follow suit - NOT!!

[Lindaloo]

No...the government does not need to get involved in the insurance industry.

No but they DO need to set some more strict regulations instead of cowering down to them while we suffer!

[DoctorHurricane2003]

They make way too much money and when the time comes for them to cough it up like they are SUPPOSED TO, they bail out. Allstate is the worst by far. One day they will go bankrupt from this, and that will be a very good day for America (they have to be taught a lesson)

[gtalum]

No but they DO need to set some more strict regulations instead of cowering down to them while we suffer!

Strict government regulations = higher cost for us.

One way or another the insurance companies will either get their profit or abandon the business. Either way, we pay.

[DoctorHurricane2003]

^No not necessarily. Part of that regulation could be to cap the cost to the consumer.

[alicia-w]

Higher cost? Maybe. But that's irrelevant if the policy isnt even available.

[Stephanie]

No...the government does not need to get involved in the insurance industry.

No but they DO need to set some more strict regulations instead of cowering down to them while we suffer!

I agree.

[gtalum]

^No not necessarily. Part of that regulation could be to cap the cost to the consumer.

If they determine that they can't make an acceptable profit on the business, they'll just pull out and we'll all end up on something like Citizen's.

[Lindaloo]

They are getting away with higher prices now and they do not pay when they are supposed to gtalum.

[gtalum]

They are getting away with higher prices now and they do not pay when they are supposed to gtalum.

They charge higher prices because they have to maintain reserves and turn a profit even when they pay out massive sums. They try to not pay out unless they absolutely have to because they are a business. A lot of the problem is that many people are seriously under-insured or improperly insured.

Regardless, when regulation increases, so do costs to the consumer. We'll end up paying in the form of increased premiums, increased deductibles, and/or reduced claim payment. And we'll likely end up with fewer companies to choose from or even worse, government insurance.

[alicia-w]

you hit it right on the head. they're more interested in making a profit than providing the service the customers pay for.

[gtalum]

they're more interested in making a profit than providing the service the customers pay for.

As is every for-profit company.

[alicia-w]

when you dont provide a service as advertised (and bought and paid for). i think that's called FRAUD.

[gtalum]

when you dont provide a service as advertised (and bought and paid for). i think that's called FRAUD.

I guess we'll see when the court cases are decided. Until then, innocent until proven guilty.

I know for a fact that many people who did not purchase flood insurance are angry because their insurance companies won't pay for their homes because they were damaged or destroyed by flood. It's not the fault of the insurance companies if people were inadequately insured.

I know there probably is some malfeasance by the companies, but if there is it will be taken care of in court as it should be.

[DoctorHurricane2003]

^no, but it IS SOMEONE'S fault for people not being drawn/classified in a flood zone, and then a hurricane comes and floods them away (even though they weren't in a flood zone...happened in Ivan, and I'm 99.9% sure it happened in Katrina)

[gtalum]

^no, but it IS SOMEONE'S fault for people not being drawn/classified in a flood zone, and then a hurricane comes and floods them away (even though they weren't in a flood zone...happened in Ivan, and I'm 99.9% sure it happened in Katrina)

That's true, someone royally screwed the pooch drawing the flood zones, and I suspect that's true elsewhere, not just in LA and MS. Because of the Katrina insurance nightmares I'm looking for flood insurance even though I'm technically outside the flood zone. I'm not that far outside. One nice thing about being outside of the flood zones is that it's actually pretty cheap to get flood insurance.