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Insurance Refunds

New York, NY: (May-13-08) State regulators brought charges against insurance giant Allstate Corporation, over money owed to current and former policyholders. The Texas Department of Insurance, and the Office of Public Insurance Counsel, who filed the suit, stated that Allstate charged customers excessive home insurance rates from 2004 to 2007. Federal officials announced that the dispute has reached settlement, in which Allstate will pay over $70 million to current and former policyholders. The settlement will see refunds, credits and rate reductions for about 700,000 Allstate policyholders.

Under the terms of the deal, apart from giving customers nearly $37 million worth of refunds, the insurer also agreed to reduce insurance rates by 3% and freeze home insurance rates for the next year. State records show that Allstate Texas Lloyds is the second largest home insurer in TX. Sources stated that, adding an estimated value of about $35 million for additional credits and reductions, the total payout comes to over $70 million. [REUTERS UK: ALLSTATE, TEXAS REGULATORS IN $70 MLN SETTLEMENT]


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Published on May-15-08


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