NU Online News Service, Feb. 2, 12:44 p.m.EST

Allstate Corp. says 2011 fourth-quarter net income increased 145percent over the prior year due to improved profitability in itsinsurance business and solid performance in its financialsegment.

The Northbrook,Ill.—based company reports a fourth-quarternet-income increase of $428 million to $724 million. Earnings pershare rose 88 cents to $1.43, beating analyst estimates of 97 centsa share. Consolidated revenues rose 2 percent, or $149 million, to$8.2 billion.

For the year, net income dropped 15 percent or $140 million to$788 million. Earnings per share were down 20 cents to $1.51.Revenues increased 4 percent or $1.25 billion to $32.7 billion.

The company's combined ratio improved 10.1 points to 90.7 in thequarter, but rose 5.3 points to 103.4 for the year.

Allstate says that it had $66 million in catastrophe losses inthe fourth quarter. That includes 19 catastrophe events that costan estimated $216 million. These events “were substantially offsetby favorable reserve re-estimates of $150 million, $118 million ofwhich related to prior 2011 events.” The company notes that in 2010it recorded $537 million in catastrophe losses.

On Allstate's financial segment, the company reportsfourth-quarter net income of $140 million, an increase of 84percent or $64 million. On the year, financial segment net incomerose $528 million to $586 million.

The company says it further improved its personal-linesunderwriting performance with rate increases that averaged 7.1percent.

Policy counts for Allstate-brand policies declined from 2010 inboth homeowners and auto segment as the company took action toimprove profitability inFloridaandNew York, Allstate says.

It also opened-up avenues to new customers with its Good HandsRoadside Assistance promotion that signed up 390,000 members duringthe year. Thomas J. Wilson, chairman, president and chief executiveofficer of Allstate says the promotion of this unique brand opensup new possibilities of cross selling.

During a conference call with financial analysts, Wilsonoutlined the company's performance, saying the company has adopteda long-term strategy that will deliver to customers insuranceproducts through the system they most desire, whether that isonline or through an agent. The ultimate aim, he says, is togenerate an operating return on equity of 13 percent by 2014.