(Bloomberg) -- Allstate Corp., the largest publicly traded U.S. seller of car and home insurance, said it’s raising rates for drivers after profitability declined at its namesake auto unit.
Allstate joins Berkshire Hathaway Inc.’s Geico in lifting rates after margins worsened. First-quarter underwriting income for Allstate auto fell 48% to $144 million, the insurer said on a spreadsheet posted on its website on Tuesday.
“We didn’t make as much money in auto insurance this quarter, in part because of weather, in part because we have to adjust prices, reflecting economic activity,” Allstate Chief Executive Officer Tom Wilson said in a conference call on Wednesday. He said customers have been driving more miles as the economy improves, increasing the number of claims.
Allstate declined 4.1% to $67.15 at 10:40 a.m. in New York, extending its loss to 4.4% this year.
The average premiums paid by customers have been “steadily increasing,” Matt Winter, Allstate’s president, said on the call.
In addition to the Allstate brand, Wilson’s company also sells coverage through the Esurance and Encompass units.
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