Allstate

A clear commonality is already emerging much as it did in the previous quarter, when severe convective storms – particularly hail – also dominated.

Most of the losses, around 80%, were the result of two wind and hail events.

Allstate’s underperformance in results and value creation may be an opportunity for activist investor Trian, but history suggests it will have its work cut out.

The carrier has suffered five quarters of losses, largely spurred on by hefty natural catastrophe losses.

Total losses for the year from April now exceed $3.5bn.

Differing trends in short- and long-tail lines offset each other to create a net positive for the industry, though the releases are slowing significantly.

The settlement would resolve claims that Allstate defrauded shareholders by underreporting “skyrocketing” auto claims to artificially boost the stock price, which later crashed.

Allstate reported cat losses of $1bn and $885mn for June and May.

On the surface, InsurTech results were better than the noise from incumbents, but caution is needed to ascertain the quality of new business coming in during a time when even industry leaders stumble.

The downgrades reflect the negative impact of challenging macro-economic trends on underwriting results and risk-adjusted capitalization.

In California, the carrier filed for a 35% increase this quarter after implementing a 6.9% rate hike in April.

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