Most large insurance brokerages have been offering banking products now for years. While their rates aren’t always on par with the top online savings rates or credit union savings rates, they are still generally more competitive than those offered by big banks (Chase, B of A, CitiBank, etc).
Allstate, otherwise known as the “good hands” company, has managed to become a dominant force in the insurance industry, specializing in insuring reliable and safe drivers. What consumers may not know, however, is that they are also quickly becoming somewhat of a banking giant as well.
As for their insurance segment, the company is the second-largest personal lines insurer in the US, just behind rival State Farm. Its Allstate Protection segment sells auto, homeowners, property/casualty, and life insurance products to consumers in both Canada and the United States.
Allstate Bank provides many of the products any standard bank or credit union would. Today, their competitive offers consist of CD (certificate of deposit) rates, money market accounts and high yield savings accounts. AllState Bank is federally insured by the FDIC and headquartered in Illinois.
Allstate Bank Certificate of Deposit:
You may open a deposit account with Allstate using one of four methods. You can open an account through participating “STAR” ATM’s which accept deposits, you can transfer money electronically via ACH wire transfer, you can make a direct deposit using Allstate Bank’s ABA routing number or you can simply mail them a check.
Current CD rates:
- 30 day CD rate of 0.20% APY with minimum deposit of $1,000 required.
- 90 day CD rate of 0.40% APY with minimum deposit of $1,000 required.
- 6 month CD rate of 0.60% APY with minimum deposit of $1,000 required.
- 1 year CD rate of 1.10% APY with minimum deposit of $1,000 required.
- 2 year CD rate of 1.25% APY with minimum deposit of $1,000 required.
- 3 year CD rate of 1.60% APY with minimum deposit of $1,000 required.
- 5 year CD rate of 2.30% APY with minimum deposit of $1,000 required.
While we’ve seen fairly competitive rates from AllState Bank in the past, their current CD rates are fairly bad. The only term that comes close to matching the national average is their 5 year CD – and we wouldn’t recommend committing funds to a long term deposit such as this in our current interest rate environment. The FED has set 2014 as a ‘tentative’ year for beginning to hike rates once again, so locking into a CD maturing after that date may not be the best move.
Related: Consider investing in bonds rather than bank CD’s.