Amid the ongoing insurance crisis in California, Allstate says it could soon resume writing new policies, though the move would come with some conditions.
Allstate Insurance stopped writing new homeowners policies in California two years ago but says it may start offering them again if the state Department of Insurance will allow them to use catastrophic modeling when requesting rate increases.
Catastrophic models are computerized reports that simulate potential catastrophic events and could be used to justify rate increases.
Allstate cited wildfire risk, the cost of rebuilding homes and the rising price of reinsurance as reasons for halting new policies in 2022. The company continued to renew existing policies.
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In a statement, Allstate said: "Once home insurance rates fully reflect the cost of providing protection to consumers, we’ll be able to offer home insurance policies to more Californians with timely rate approvals, the use of our advanced wildfire modeling and reinsurance costs."
Later Thursday morning, the Little Hoover Commission was scheduled to hold a public hearing in Sacramento to reflect on the state home insurance market, with speakers from the governor’s Office of Emergency Services and California’s FAIR plan along with other experts.
Also Thursday, a town hall is scheduled in Hillsborough, where state Sen. Josh Becker, experts from the Department of Insurance and united policyholders will discuss the insurance crisis in the state.
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Allstate did not provide an exact timeline for when it could start rewriting policies. The Insurance Department plans to enact regulations by the end of the year.
