You’re in good hands with Allstate — orange hands, that is. According to a report in the Home Center News, if you are an Allstate homeowner’s policyholder, and you have some damage to your home, you’re going to have to get your building products at Home Depot prices — or pay the difference out of your own pocket. The Home Center News called the new Allstate/Home Depot deal an “innovative alliance” that will funnel Allstate policyholders to Home Depot during the claims process, allowing Home Depot to “tap into a market segment that could add $40 milliion in sales to its coffers annually and could produce cost savings for the insurer of between $30 million and $50 million annually”. Here’s how it would work: If you wanted your Allstante home insurance policy to pay for repairs or restoration due to damages, Allstate will give you a claim quote based on Home Depot prices. You, as the policyholder, are not required to go to Home Depot to get the items — but if you purchased them elsewhere at a higher cost, you’ll pay the difference in price out of your own pocket — even if the quality of product at Home Depot is not to your liking. Allstate is reportedly referring floor covering repair projects to Home Depot as well. The Home Center News claims that Allstate chose this one-partner deal with Home Depot because “it currently is the only national home improvement chain and because of its installation services”. That should please the people at Lowe’s and local contractors everywhere. Allstate is diverting away from the small installers who won’t or can’t sign a deal with Home Depot. The report called Allstate’s deal an “implicit endorsement” of Home Deport’s pricing compared to its competitors. Many readers will remember Allstate once had a similar deal with Sears, but that relationship seems to have gone on the soft side. Allstate has just tied its 14 million policyholders to one supply company, but the insurance company says it would be willing to extend this “program” to other dealers.
Unhappy with the idea of your insurance company trying to steer your home repair business to one vendor? Do you think Allstate should cover the items damaged — not just the items as they are priced by one vendor? Allstate is directing business away from smaller, hometown merchants, helping the big player, while helping itself pay less on your policy claims. Want to send a message to Allstate that you don’t want to be placed in Home Depot’s “good hands”? You can go to www.allstate.com and email the company your thoughts. Better yet, tell Allstate you’ll be looking for another insurer who values small town life and merchants more than Allstate, because of Home Depot’s track record in pushing its way into local communities. You should be free to seek the products you want to repair home damage, not tied to any one supplier. This is Allstate’s version of managed health care for the building supply industry: use our vendors, or pay more to go out of the network.