Update: Allstate Estimates Catastrophe Losses of $1 Billion in June, $2.7 Billion in Q2

Allstate Corp. announced estimated catastrophe losses for the month of June of $1.01 billion, or $799 million, after-tax.

June’s month catastrophe losses include 18 events estimated at $1.13 billion, with approximately 60% of the losses related to four wind and hail events, partially offset by favorable reserve reestimates for prior events.

Total catastrophe losses for the second quarter were $2.70 billion, pre-tax.

(Editor’s note: an equity investors’ note issued by Wells Fargo indicated that Allstate’s June estimate for catastrophe losses was the company’s highest ever for June and well above the five-year average of $296 million for the month.)

Unfavorable prior year reserve reestimates, excluding catastrophes, totaled $181 million in the second quarter with approximately $148 million related to National General brand, primarily driven by personal auto injury coverages, and approximately $31 million related to litigation activity in the state of Florida.

During the month of June, the Allstate brand implemented auto rate increases of 11.6% across 12 locations, resulting in total brand premium impact of 2.6%.

“Allstate continued to implement significant auto and homeowners insurance rate actions as part of our comprehensive plan to improve profitability. Beginning with this month’s release, we are expanding reporting transparency by disclosing implemented homeowners insurance rates monthly,” commented Jess Merten, chief financial officer of Allstate, in a statement.

“Since the beginning of the year, rate increases for Allstate brand auto insurance have resulted in a premium impact of 7.5%, which are expected to raise annualized written premiums by approximately $1.95 billion and rate increases for Allstate brand homeowners insurance have resulted in a premium impact of 7.4%, which are expected to raise annualized written premiums by approximately $754 million,” Merten added.

Source: Allstate

Photograph: Buildings and vehicles show damage after a tornado struck Perryton, Texas, on Thursday, June 15, 2023. (AP Photo/David Erickson)