Allstate Settles Auto Insurance Claim Spike Suit for $90 Million

Allstate Corp. struck a $90 million settlement in a shareholder class action alleging that the auto insurer failed to disclose details about a spike in claims, according to a motion for preliminary approval of the deal.

Allstate has agreed to pay a consolidated class of investors to drop their suit, which had estimated $556 million in total damages from to a stock drop that occurred as a result of the alleged misrepresentations.

The insurance company misled investors about the auto claims and failed to disclose that the spike resulted from softened underwriting policies, according to the consolidated complaint filed in ...