ATLANTA — Georgia’s Insurance Commissioner says an insurance giant is taking advantage of a loophole in Georgia law to dramatically raise auto insurance rates for customers.
“We think it’s outrageous, but they are using a loophole in current state law,” King told Channel 2 Consumer Investigative Reporter Justin Gray on Wednesday.
Allstate is using something called “file and use” to increase Georgia auto insurance rates by 25% in September.
That’s on top of the 14% increase already approved by regulators earlier this year.
“There’s clearly a loophole, and this is the only company that’s used this. I mean, most companies we work with understand we are in incredibly economic trying times, and they work with us,” King said.
Channel 2 checked major insurers’ Georgia rate increases for 2022. The Insurance Commissioner’s office tells us Allstate is the only insurer in Georgia with a double-digit percentage increase.
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Nationwide did not increase rates at all. State Farm was at a 5-8% increase, Progressive was 6.5%, and Allstate was the outlier at 40%.
“We’ve been very successful negotiating with every other company to keep those rate increases at a reasonable level,” King said.
Channel 2 Investigates has done a series of stories in recent years on customers who had trouble getting Allstate to pay up after a crash.
It took Tesha McGee two years and a jury trial.
“These people have the money to pay, and they just want to ring you out until there’s no more juice left,” McGhee said.
And an Allstate insider, former Allstate staff attorney Laura Johnson Bailey, told Channel 2 that Allstate policy is to make low ball offers.
“Allstate’s the worst. Easily,” Bailey said.
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“Even though inflation and other factors are causing auto prices to rise, customers will continue to get competitive prices with Allstate,” the company said in a statement to Channel 2.
Allstate also referred us to an insurance industry trade group study that says insurance rates are just returning to pre-pandemic levels.
But Commissioner John King was clear. His concern is not with the insurance industry as a whole. It’s just with Allstate.
He has asked legislative leaders to change the law to eliminate the loophole.
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