Allstate Home Insurance Retains 15% Marriage Discount for Widows and Widowers in Maryland

Allstate Insurance Company submitted a request to the Maryland Bureau of Insurance in September 2017 to increase the premiums for its homeowners insurance customers in the state by an average of 1.05%.

The filing is still pending but if it's approved, current policyholders will be affected on or after November 7, 2017, should they choose to renew their policies. Allstate has stated in the filing that it will not accept new business for this particular program.

Proposed rate impact

Allstate has requested that widows and widowers be classified as married. If approved by Maryland's Bureau of Insurance, the filing would allow existing policyholders to retain the 15% discount they had for being married. Previously, newly widowed drivers would be categorized as "single" and receive higher quotes for their homeowners insurance based on standard risk calculations. This was not unique to Allstate; other insurance companies have traditionally treated married couples the same way in assessing risk for insurance products. The industry has only recently begun implementing this change for widows and widowers across different companies, states and insurance products.

Premiums are estimated to change slightly for 97,443 policyholders in Maryland. Overall, the changes will be largely neutral, with the impact being spread unevenly. Some policyholders will be receiving decreases while others receive increases higher than the average 1.05%. In percentage terms, the company reports the proposed rate change will range from a decrease of 19.4% to an increase of 1.6%.

As of 2016, the Allstate ranked 3rd among home insurance carriers who are active in the state, based on direct written premiums of $114 million. This translates into a 6.7% share of the market of $1.7 billion premiums in the state. The Maryland homeowners insurance market is highly concentrated. State Farm Fire & Casualty Company commands more of the market than any other carrier, holding 19.0% of all policies in the state.

Comparing rate changes

If approved, these hikes would be among the lowest rate increases to go into effect for homeowners insurance in Maryland in 2017. Among the 11 largest companies in the state, 7 have been approved for rate changes by regulators. The average increase in premiums arising from those decisions is 2.6%. Within the approved list, the largest hikes were for American Family Insurance Group (with an average increase of 9.5%); United Services Automobile Associate Group (5.9% on average); and Liberty Mutual Group (5.7% on average).

When compared to the rest of the U.S., homeowners in Maryland enjoy some of the lowest home insurance costs. Premiums are 13% cheaper than the average premiums for homeowners in the country as a whole, with our sample Maryland policyholders facing an average annual fee of $942 to insure their homes. That annual tab translates into an average monthly cost of $79.

Maryland's neighbors, Delaware and Pennsylvania, are on the the more affordable end of the spectrum. Our benchmark homeowners would be facing paying a monthly average of $61 and $74 respectively.

Katherine Ross

Katherine is a former Editorial Associate at ValuePenguin.

Comments and Questions