At least one of the proposed rate increases by auto insurance companies nationwide will go forward — at least for now.
Allstate Insurance's plan to increase personal auto rates in the state of Georgia will take effect May 22. Premiums could increase as much as 58.3%, with an average increase of around 25%.
Though Georgia insurance regulators have launched a review of Allstate's filing, a 2008 state law allows companies to file and implement rates without explicit, formal approval. Because the review will not be completed by the date stipulated by Allstate, the carrier will move forward with its plans.
"At this time, it does not appear that the results of the examination will be determined before the effective date," said state Insurance Commissioner Ralph Hudgens.
That doesn't mean the increases will be permanent, however. In a conversation with Insurance Business America, Hudgens' spokesperson Glenn Allen explained if the regulatory review, currently being conducted by an actuarial firm, indicates that Allstate's rate hikes are "excessive or discriminatory," the commissioner will roll back the filing.
Hudgens himself iterated this point.
"If the filing is proven to be excessive, then I will do everything allowed by law to reverse Allstate's actions," he told the Atlanta Journal-Constitution.
In an earlier interview with local station WRBL, Hudgens said that he was ". . . not there to protect the insurance company. [He’s] there to protect the Georgia citizens."
According to a spokesperson for Allstate, the recent surge in the number of miles driven, traffic fatalities, and auto repair costs have led to a corollary increase in claims and costs to settle such expenses. This increase in automobile usage could be attributed to currently low gas prices.
The insurer has promised to cooperate with the state regulator in order to work out a compromise.
"Should the department's review raise any questions with our filing, we will work cooperatively to reach agreement on these questions and take whatever steps are necessary to comply with that agreement," said Allstate spokesman Adam Polak.
