That’s Quite Shitty: Allstate Cancelling NYC Homeowner’s Insurance Policies due to Hurricane Risk

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Allstate Insurance is engaging in some extremely shady and possibly illegal practices with their homeowners’ insurance policies in the New York City area. I’ve been a customer of theirs for almost 10 years, with various insurance policies for my old condo in Manhattan and now my house in Brooklyn. I’ve paid every single one of my premiums on time and have NEVER registered a claim against any of my policies. I currently live in a townhouse, so there is no exposure on either side of my house. My house is a wood frame but was recently gutted and all steel columns were installed throughout. We are not near the shore or any rivers or canals and we sit fairly high above sea level. So imagine my surprise two weeks ago when I got a letter in the mail saying my policy, which is up in 2 months, is not being renewed. The reason for this was cited as follows:

“As you may know, the 2004 and 2005 Hurricane Seasons brought terrible destruction to the Southeastern United States, across a huge area stretching from Texas to Florida. The extent of the damage and devastation was unprecedented. We have an expectation that similarly destructive storms are possible all along the East coast in the coming years. Although no one can predict with certainty when or where a storm will hit, we believe there is a potential for significant damage in your area.”

What a bunch of bullshit.

I immediately picked up the phone and called my Allstate representative, who has always been fantastic to work with through the years. She told me Allstate was NOT RENEWING homeowner’s insurance for any single policy holders in all the five boroughs of NYC and Long Island. They are only renewing homeowner’s insurance for policy holders who also hold another policy with Allstate, either car or life insurance.

So let’s get this straight–it’s not about risk at all. Hell, insurance policies are all about mitigating risk, there is no such thing as a property that isn’t at some sort of risk. But with Allstate’s current logic, two neighbors could have house built the same year from the same type of construction, and if one of them has just homeowner’s insurance through Allstate but the other has homeowners’ and also has auto insurance, one will lose their insurance and the other will keep it–not because of risk, THEY ARE RIGHT NEXT TO EACH OTHER, but because Allstate is collecting a larger check from the multiple policy holder. Disgusting. Immoral. Illegal?

My boyfriend, who lives with me, has his car insurance through Allstate so we explored the possibility of putting my name on his policy and vice versa to qualify for renewal, but because his name is not on the deed to the house it was not feasible. I asked about taking a small life insurance policy out but was told that it would have needed to be in place prior to 2005 to qualify. My rep told me she was disgusted to be working for Allstate, that she didn’t know how this could be legal for them to do and that she was so sorry to see me go after years of such a great working relationship. All well and good, but now I am without insurance.

I’ve spoken to Statefarm and am looking to get a few more estimates, and my boyfriend will also move his policy away from Allstate as he is sickened by this practice. I just filed a complaint with the NYS Insurance Department of Consumer Affairs. And I’ll be making a Dennis Haysbert shaped voodoo doll. Any other suggestions?

5 Comments so far

  1. Ethan Stanislawski (unregistered) on May 8th, 2007 @ 1:24 am

    Hey, don’t take it out on Haysbert! He’s had a hard enough time, y’know, getting germed to death on 24, which also may have germed to death any chance of him doing more than Allstate ads and crappy CBS shows.


  2. Ethan Stanislawski (unregistered) on May 8th, 2007 @ 1:25 am

    Also, he can’t hit a curveball either.


  3. ~dana (unregistered) on May 8th, 2007 @ 11:05 am

    Hats for bats, keep bats warm!


  4. Bronwen (unregistered) on May 10th, 2007 @ 8:32 pm

    Dana, Curbed LA posted a very familiar sounding story about Allstate in California.

    http://la.curbed.com/archives/2007/05/allstate_flees.php


  5. ~dana (unregistered) on May 12th, 2007 @ 9:36 pm

    Hey Bronwen–thanks! I sent this to Curbed here in NYC but they don’t appear to have picked it up. Oh well.



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