Texas approved many of the most impactful homeowners' insurance rate increases in the second quarter, according to an S&P Global Market Intelligence analysis.
Regulators of the Lone Star State approved 39 rate increases during the period — including 21 over 10%.
In terms of calculated premium change, Texas regulators approved six of the most significant homeowners rate increases in the US within the quarter. The most significant rate change, a 24.1% increase, was granted to The Allstate Corp.'s Allstate Vehicle & Property Insurance Co. unit with a calculated premium change of $337.1 million. This rate change is reported to affect over 650,000 policyholders.
In total, Allstate subsidiaries received approval for 59 rate increases, including 33 over 10%. The company's approved rate filings reported an aggregate of $548.5 million in calculated premium growth, the most of any group.
State Farm increases rates in Q2
State Farm Mutual Automobile Insurance Co. received approval for 16 rate hikes during the quarter, with a calculated premium change of $490.7 million. The company's most significant rate increase was a 7.6% rate change for State Farm Lloyds, approved by Texas regulators. The second-highest percentage rate increase State Farm received was for its insurtech subsidiary HiRoad Assurance Co. The company received a 20.7% increase in Arizona limited to 137 policyholders, according to the filing.
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USAA receives approval for major rate hikes
Multiple companies received an increase in excess of 20% on business worth $20 million or more. United Services Automobile Association received such an approval in six instances. The bulk of these filings happened in Colorado with four rate changes in excess of 30%. The calculated written premium change listed for the Colorado filings aggregates to $151.6 million.
The largest percentage change for the quarter belongs to Liberty Insurance Corp., a subsidiary of Liberty Mutual Holding Co. Inc. California regulators approved a 65% rate increase for the subsidiary's LibertyGuard condominium program. The new rate took effect Aug. 1 for both new and renewal business and is reported to affect about 35,000 policyholders.
All figures listed are based on as-reported numbers filed in the rate filings of each subsidiary in each state. The calculated premium change is not a final projection of the additional premium the insurer may receive in the upcoming year. The calculated premium change is reported by each insurer to reflect the most impactful premium changes based on the combined impact of the percentage change and the amount of business it affects. Changes to the insurer's policy mix or policies in force are not factored into the analysis.
US states employ a variety of rate regulation mechanisms, including prior approval, modified prior approval, file and use as well as use and file. Some states do not require explicit regulatory approval prior to insurers using new rates. This analysis is based on when rate filings are "disposed" by state regulators and does not take into account when those new rates became effective for new and renewal business. In some instances, a new rate may have been in effect prior to the month the filing was approved by the regulator.