S&P: Allstate’s Ratings Unaffected by Florida Suspension

Standard & Poor’s Ratings Services said today that news reports (See IJ web site) about the suspension issued to Allstate Corp. (ALL) by the Florida Insurance Commissioner that prohibit some of the companies subsidiaries from writing new auto insurance policies, and possibly homeowners policies, in the state will not affect the ratings on ALL and subsidiaries. S&P noted that Allstate may still renew existing policies

“The suspension follows allegations that the company did not comply with a subpoena to testify about its property insurance business, specifically proposed rate increases filed in 2007,” S&P explained. “This is a long-standing subject in Florida, beginning when the 2004 hurricane season severely impacted the state and insurers paid out about $35 billion in insured losses. Since then, ALL has significantly reduced its underwriting of homeowners business in Florida but has expanded its auto book of business.”

S&P said it “believes that the effects of the suspension are not sufficiently material to change the rating on ALL, but will continue to monitor the events as they relate to ALL and its interactively rated insurance companies doing business in the state.”

Source: Standard & Poor’s – www.standardandpoors.com