Allstate Corp. plans to raise car insurance rates for Illinois drivers by 3 to 5 percent, according to company filings with the Illinois Department of Insurance. New rates will go into effect May 17th. According to the company, this decision reverses the “hometown discount” advertised since 2009. They added that the size of the increase will depend upon how long a customer has been with the insurance company. This decision comes after Allstate posted its largest profit gain since 2007.
Why Raise Rates?
Allstate has been struggling to keep pace with the lower-priced competition lately. This last price hike is their attempt to gain more ground. Company spokespeople say they’ve set aside more than enough money for accident claims, which has led to bigger profits than previous years. Similarly, Geico is raising rates 2.5 percent, which will go into effect May 10th for new customers and June 25th for most drivers. So Allstate didn’t really have to think twice about raising rates if everyone else is doing it too.
Is Everyone Raising Illinois Auto Insurance Rates?
Not everyone is jacking up prices, however. The largest auto insurance provider in Illinois — State Farm — just slashed rates 2 percent this past December after three years of annual increases.
How To Get Lower Auto Insurance Rates
Since prices are always fluctuating, the best thing a consumer can do is to shop around for competitive quotes. Each company has a different method of determining how much to charge a customer, so the numbers can really vary widely. Just a few minutes entering information online can save customers thousands of dollars per year in some cases.