1. The article focuses on the recent hurricanes which devastated the east coast. Theo Francis explains the effect of the hurricane on the Allstate insurance company. The hurricane caused $1.1 billion in losses for the insurance company in the year 2004. Allstate announced to its shareholders that the hurricane caused huge third-quarter loses. The third-quarter reports are not completed at this point but the company was trying to be honest with its shareholders. Before the hurricane, Allstate had a profit of $691 million for the third-quarter.
Allstate intends to provide additional money to the Allstate branches in Florida to help the state and its residents recover. Florida suffered the brunt of the hurricanes in 2004. Insured losses throughout the insurance industry totaled more than $20 billion. Allstate is currently considering rewriting its policies in Florida to alleviate the possibility of suffering major losses again.
Allstate estimates that the Florida Hurricane Catastrophe Fund, a state sponsored insurance pool, will only cover $172 million of the $1.81 billion the insurance company will pay out to investors. Investors expected third-quarter losses due to the hurricane season and property damage estimates in Florida. Stock prices are currently down for Allstate.
2. The article makes use of a metaphor in describing the effects of the hurricane on Allstate and its third-quarter finances. Theo Francis writes that "This year's four powerful hurricane
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