Allstate Improves 4Q Net Income By 145%

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

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

The Northbrook,Ill.—based company reports a fourth-quarter net-income increase of $428 million to $724 million. Earnings per share rose 88 cents to $1.43, beating analyst estimates of 97 cents a 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 the quarter, but rose 5.3 points to 103.4 for the year.

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

On Allstate’s financial segment, the company reports fourth-quarter net income of $140 million, an increase of 84 percent or $64 million. On the year, financial segment net income rose $528 million to $586 million. 

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

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

It also opened-up avenues to new customers with its Good Hands Roadside Assistance promotion that signed up 390,000 members during the year. Thomas J. Wilson, chairman, president and chief executive officer of Allstate says the promotion of this unique brand opens up new possibilities of cross selling.

During a conference call with financial analysts, Wilson outlined the company’s performance, saying the company has adopted a long-term strategy that will deliver to customers insurance products through the system they most desire, whether that is online or through an agent. The ultimate aim, he says, is to generate an operating return on equity of 13 percent by 2014.

Comments

Resource Center

View All »

Complimentary White Paper: The Compression of Workplace Time

How brokers and carriers respond to the compression of workplace time will create significant competitive...

The Changing Insurance Consumer: 6 Ways to Create Profitable Relationships

Today’s mobile and web-savvy consumers have new expectations when it comes to interacting with your...

Contractors General Liability Coverage 102

What is a prior work exclusion? Which option is right for my client? Why do...

Sign up today to get a 50% matching credit -...

Insurance marketing sometimes seems like it's a game of swings and misses, but we're here...

Guide: 5 Steps to Selling Cyber

Cyber risk and data security is on the agenda of every business owner and executive....

Citation Correlation

Do rigger and signalperson qualifications correlate with the cause of crane and rigging accidents? ...

Complete Guide to Electronic Signatures in Property & Casualty Insurance...

In property and casualty insurance, closing new business quickly is key. Learn how to leverage...

INSTANT ACCESS: Complimentary Sales Closer Questionnaires

Help property owners or managers compare your commercial residential property insurance coverage vs. the competition....

Determining Vacant Property Perils and Valuations

Are your clients fully covered for Vacant Properties? In this economic climate, your insureds may...

Risk Management for Law Firms

This package of 3 concise risk management articles offers straightforward content and practical suggestions law...

Tech Digest eNewsletter

Technology related insights for insurance professionals including key developments, solution providers and news briefs from the carrier front – FREE. Sign Up Now!

Advertisement. Closing in 15 seconds.