Auto Rates Rising for State Farm, Allstate Customers

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Allstate and State Farm are raising their auto rates in Texas.

State Farm filed with the Texas Department of Insurance increases of 2.4 percent and 7.3 percent, respectively, for its two auto insurance subsidiaries, State Farm Mutual and State Farm County Mutual. The rate hikes kick in Oct. 27. Kevin Davis, a State Farm spokesman, said the increases are the first in nearly five years for State Farm Mutual.

Allstate’s increases include 3.6 percent for Allstate Indemnity and 5.5 percent for Allstate County Mutual. Allstate Indemnity insures 694,000 drivers in Texas; Allstate County Mutual covers 435,000 drivers. Those rates rose in July. Allstate needed rate hikes to account for a greater frequency of collisions and the rising costs of bodily injury claims, said spokesman Bill Mellander.

State insurance officials said the market has been stable for some time. “We’re seeing an uptick now, but we don’t consider this to be more than upward pressure from low prices in the past,” said Texas Department of Insurance spokesman Jerry Hagins.

Consumer groups were critical, saying the insurers are earning adequate profits with their current premiums. “It is unfortunate that State Farm and Allstate are choosing to raise rates on drivers at a time when Texans are struggling to keep up with rising costs of gasoline, food and housing,” said Alex Winslow of Texas Watch.