Allstate

Cat losses grew by 81.5%.

Monthly cat losses were driven by two major events.

Unfavorable prior year reserve re-estimates, excluding catastrophes, totaled $199mn in Q4, with approximately $148mn related to personal auto, including costs for litigation claims.

Earlier today, the insurer updated the spread on the cat bond which has settled at 5.75%, and updated the target price to $300mn-$350mn.

Allstate increased the target size of the bond to $300mn-$350mn, up from $200mn.

Sanders Re III will provide coverage for the District of Columbia and all US states apart from Florida.

Most of the losses, around 80%, were the result of two wind and hail events.

Total losses for the year from April now exceed $3.5bn.

Investors will have to wait an additional three years for collateral to be returned.

Allstate reported cat losses of $1bn and $885mn for June and May.

The downgrades reflect the negative impact of challenging macro-economic trends on underwriting results and risk-adjusted capitalization.

The carrier’s Florida reinsurance tower’s top layers comprise a total of $450mn in Class A Sanders Re cat bond coverage.