Allstate
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The Inside P&C news team runs you through the earnings results for the day. -
A clear commonality is already emerging much as it did in the previous quarter, when severe convective storms – particularly hail – also dominated.
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Most of the losses, around 80%, were the result of two wind and hail events.
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Allstate’s underperformance in results and value creation may be an opportunity for activist investor Trian, but history suggests it will have its work cut out.
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The carrier has suffered five quarters of losses, largely spurred on by hefty natural catastrophe losses.
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Differing trends in short- and long-tail lines offset each other to create a net positive for the industry, though the releases are slowing significantly.
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The settlement would resolve claims that Allstate defrauded shareholders by underreporting “skyrocketing” auto claims to artificially boost the stock price, which later crashed.
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Allstate reported cat losses of $1bn and $885mn for June and May.
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On the surface, InsurTech results were better than the noise from incumbents, but caution is needed to ascertain the quality of new business coming in during a time when even industry leaders stumble.
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The downgrades reflect the negative impact of challenging macro-economic trends on underwriting results and risk-adjusted capitalization.
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In California, the carrier filed for a 35% increase this quarter after implementing a 6.9% rate hike in April.
