RJ and Makay

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U.S. Regulators told lawmakers last week that they will adjust prohibitions on banks’ proprietary trading per Volcker rule restrictions, but will resist calls to altogether drop the measure that sprang from the Dodd-Frank Act.  Federal Reserve Governor Daniel Tarullo, along with top officials from four other agencies, defended the rule at a House Financial Services joint subcommittee hearing in Washington.

Allstate Corp. has agreed to pay $1 billion to buy online insurance companies Esurance and Answer Financial to capture more business from customers who shop online for insurance.  Allstate is buying the companies from White Mountains Insurance Group, Ltd., a Bermuda-based financial services holding company.

Esurance, through its website and 24/7 call center, is the nation’s third-largest provider of auto insurance.  Since 2006, the company has more than doubled the number of its policies and grown premiums by an average of 20% a year.  It sells insurance in thirty states and also offers other personal lines coverage.  The company has a total of 839,000 policies in force, and added approximately 65,000 polices in 2010, an increase of 8%.

Analysts at Conning Research and Consulting say the property casualty insurance industry can expect premium growth of between 3 and 4 percent in 2011, and about 5 percent for the following two years.

Through 2013, premium growth rates for the industry will be “well short of what would be considered a meaningful turn in the underwriting cycle,” says Stephan Christiansen, director of research at Conning.