Allstate's branding efforts should make it a leader among publicly traded personal lines insurers, according to an investment bank analysis.

Bear Stearns senior property-casualty analyst David Small said information gleaned from the American Institute of Financial Analysts conference indicated that “larger personal lines companies continue to make business improvements from pricing to claims to customer service that should aid retentions and limit shoppers' motivations to switch carriers.”

He wrote that insurance company managers are comparing personal lines insurance to a consumer product–”an analogy we believe will serve the larger players well over the next few years”–and Allstate should have the upper hand in such an environment, leading in brand development among publicly traded players.

“The company's advertising coupled with its unique Your Choice products has helped Allstate build its image as a customer-focused organization,” he wrote.

While Geico may lead all companies in terms of advertising dollars, it is part of the Berkshire Hathaway group and not individually traded.

Mr. Small also said the company's “impressive capital management story makes it a relatively defensive stock to own.”

The overall insurance pricing market is softening. “Growth opportunities are limited and companies are focused on capital management,” he noted.

While share repurchases may at this time seem a wise strategy to maintain share price, it has its limits, according to Mr. Small.

“It is hard to see outsized share appreciation driven by share buybacks as fundamentals deteriorate,” he wrote.

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Allstate Branding Seen Tops Among Traded Insurers

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