Allstate (NYSE:ALL) is raising auto insurance rates. In an interview with FOX Business Network’s Maria Bartiromo, CEO Tom Wilson said customers could see up to a 5% surge in their rates as the company needs to cover the increase in automobile accidents.
“Starting at about fall last year, people started driving more. They drive more, they have more accidents. There’s more accidents that cost more to fix them because the car is more expensive.
So as a result of that, what we are doing now is just raising prices in auto insurance,” he said.
Wilson said he expects growth in the insurance business.
“We can grow in the businesses we’re in. In terms of auto insurance and home insurance -- we insure around 10% of the markets depending on which state you look at and so we have plenty of room to grow there and we intend to grow there,” he said.
Wilson also said the company is betting on the “connected car” for longer-term growth.
“What we are trying to do is give people the right price for them… With all these sensors, we can tell if you’re a good driver, you [will] save a lot of money and so with our Drivewise product about 60% of the people end up with lower insurance premiums as a result of that,” he said.