Allstate CEO says lack of trust in nation a problem for democracy and capitalism

Allstate CEO Tom Wilson told CNBC Monday that trust in America is at a tipping point.

“It is a problem for Americans,” Wilson said. “We don’t trust our leaders. We don’t trust our government. We don’t trust other institutions.”

He said the lack of trust is a problem for democracy and capitalism.

“It’s interesting that an insurance company is talking about trust. People have to trust the insurance company to pay out,” a CNBC host said in response. “How much of what you are doing, ultimately, is around trying to understand that issue?” 

Wilson responded, “It’s a great point, people give us their money and they trust that we’ll be there when something bad happens. It’s obviously important to Allstate, but it’s important to businesses functioning in an economy. It’s important to people. Trust is freedom. If you don’t trust people, you don’t get on a plane, you don’t get in a car.” 

Allstate research released last month shows that people don’t trust others in America, but they do trust the future of their local communities, and about two-thirds volunteer, Wilson said. 

“Our idea is to first rebuild local relationships,” Wilson said. “When you do that, if you are doing sandbags or making sandwiches for homeless people, you’re building a relationship, and relationships are about trust… The other thing is to get out of the web of negativity that we’re in.” 

Allstate’s survey found three-quarters of respondents are concerned about the cost of living, 72% about the state of the country, and 64% about the safety of their family. 

Yet, two-thirds feel included, 74% are optimistic about the future of their communities, and 68% are involved in their local community. 

“As one of America’s most trusted brands, we are working to strengthen trust,” Wilson says in a press release about the research results. “This research shows that leveraging community involvement to broaden relationships will improve trust and set America apart from the world.”

The report states that 78% of respondents with high trust levels are engaged in the community versus 44% of those with low trust levels. 

The release says Allstate and the Aspen Institute are working on a three-year initiative to improve trust at the local level. 

The survey reached 5,000 adults and was conducted between April 10 and April 30, about a month before a Senate subcommittee hearing investigating claim handling during recent natural disasters.

During the hearing, Sen. Josh Hawley (R-Missouri) grilled Allstate and State Farm executives, saying testimony from adjusters and policyholders, along with previous lawsuits, appears to show the companies are “running a racket” and a “pattern of fraud” while making “outrageous profits.” 

Michael Fiato, Allstate executive vice president and chief claims officer, testified during the hearing  that he tells his team that customers’ worst days need to be Allstate’s best.

“Based on the testimony I’ve heard today, based on the witness statements, it sounds like to me that should be amended to say, ‘Our customers’ worst day is your big profit opportunity,’” Hawley said. “I mean, we’ve just heard testimony here, sworn testimony from multiple adjusters, that your company ordered them to delete or alter damage estimates to reduce payouts and to make you profits. It sounds to me like you’re running a system of institutionalized fraud.”

Fiato responded, “That would be incorrect.”

He also denied that Allstate directed adjusters to delete materials or make them factually incorrect for the purpose of driving down the award.

The Homeland Security & Governmental Affairs Subcommittee on Disaster Management, District of Columbia, and Census heard from two homeowners on May 13 who are still fighting claims from Hurricane Helene. Two adjusters testified that they were pressured to lower estimates.

In a 2023 roundtable hosted by the National Economic Council, state legislative leaders and industry representatives from around the U.S. convened at the White House to discuss the “right to repair”. In the discussion Don Jones, senior vice president at Allstate and a member of the CAR Coalition spoke as a representative of automotive repairers.

According to Autobody News coverage of the event, Jones spoke in support of the Save Money on Auto Repair Transportation (SMART) and Right to Equitable and Professional Auto Industry Repair (REPAIR) acts, as mechanisms to provide greater consumer choice and competition.

“One way to increase consumer choice is to bolster aftermarket part manufacturing,” Jones said. “Unfortunately, the manufacturing of aftermarket parts has been severely limited due to OEM use of design patents on basic cosmetic car parts.

Jones also said it has become increasingly difficult for independent repair shops to service newer vehicles with more advanced technology without the same wireless access to car data that dealers have.

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