Allstate’s third-quarter results highlight further premium hikes to keep pace with inflation

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Allstate (New York Stock Exchange:all) ramped up auto and home insurance price hikes in the third quarter to help catch up with the costs of stubbornly high inflation and offset its rise. combined ratio.

We will continue to implement a multi-pronged program to bring our material liability margins back to our target levels,” said Mario Rizzo, President of Material Liability. “This includes continued increases in auto and home insurance prices, cost reductions and the adaptation of claims settlement practices to a high inflation environment.”

The insurer posted an adjusted net loss of $1.56 per share in the third quarter on consensus of -$1.53 and income of $0.73. This was due to higher invoices, higher re-estimation of unfavorable prior year reserves and lower net investment income.

Revenue of $13.21 billion was up from $12.48 billion on Sept. 30, 2021 and fell short of the average analyst estimate of $13.23 billion.

The combined ratio rose to 96.4 from 90.4 a year earlier, highlighting higher loss ratios for auto and homeowners insurance.

Catastrophe losses in the third quarter were $763 million, down from $1.27 billion in the third quarter last year.

General liability underwriting losses were $1.29 billion, compared with $534 million in the third quarter of 2021. A $11.16 billion increase in existing reserves, up from $10.16 billion a year ago, primarily reflecting an unfavorable prior-year reserve re-estimate in motor personal injury coverage and increases in the current reporting year. Accrued Premiums Severity claims across accident and physical injury coverage.

Consolidated net investment income of $690 million decreased from $764 million a year ago.

Previously (Nov. 2) Allstate’s non-GAAP EPS was -$1.56, a difference of $0.03. $13.21 billion in miss revenue, $90 million.

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