Provides Guidance for 2002 Earnings
NORTHBROOK, Ill., Feb. 6 /PRNewswire-FirstCall/ -- The Allstate
Corporation (NYSE: ALL) today reported operating income after restructuring
charges of $309 million ($0.43 per diluted share) for the fourth quarter of
2001 compared to $584 million ($0.79 per diluted share) for the fourth quarter
of 2000. Operating income before restructuring charges was $379 million
($0.53 per diluted share) for the fourth quarter of 2001 compared to
$589 million ($0.80 per diluted share) for the fourth quarter of 2000. Net
income was $264 million ($0.37 per diluted share) for the fourth quarter of
2001 compared to $547 million ($0.74 per diluted share) for the fourth quarter
of 2000. Operating income is defined as net income before after-tax effects of
realized capital gains and losses, loss on disposition of operations,
dividends on preferred securities of subsidiary trusts and the cumulative
effect of changes in accounting principle.
Operating income after restructuring charges was $1.49 billion ($2.06 per
diluted share) for the year 2001 compared to $2.00 billion ($2.68 per diluted
share) for the year 2000. Operating income before restructuring charges was
$1.58 billion ($2.18 per diluted share) for the year 2001 compared to
$2.04 billion ($2.73 per diluted share) for the year 2000. Net income was
$1.16 billion ($1.60 per diluted share) for the year 2001 compared to
$2.21 billion ($2.95 per diluted share) for the year 2000.
"We are not pleased with our financial results in what was an uneven
quarter. We saw strong premium growth in the Property-Liability business, very
good results from Allstate Financial, and continued progress toward our
pricing targets. However, we continue to experience significant challenges in
our Property-Liability business. Nonetheless, I am very confident that the
strong actions we are taking will significantly improve future performance,"
said chairman, president and CEO Edward M. Liddy.
"Mild weather contributed to a rebound in homeowners profitability in the
quarter, but we need to continue to address the underlying trends in this line
with pricing, product changes, and claims programs. Our actions in Texas this
quarter are a good example of how we are dealing with these negative trends
around the country. We took significant rate actions, made contract changes
that include limiting coverage for mold, and modified our underwriting
practices in order to improve the performance of this line. With the actions
we took across the country in 2001 and will continue to implement this year,
we are on track to return the homeowners line to proper levels of
profitability within the next two to seven quarters.
"We saw an encouraging 9.5% growth of written premium for the Allstate
brand standard auto line in the quarter over the prior year fourth quarter. We
also saw some pressure on Allstate standard auto frequency during the quarter,
and have already responded to the frequency trends with increased rate
activity and targeted underwriting programs in specific states. In this line,
we finished the year with a loss ratio of approximately 75% and with these
actions expect to improve that ratio over the course of 2002.
"Allstate Financial's operating income was up 28% for the fourth quarter
of 2001 compared to the fourth quarter of 2000 despite a volatile equity
market and declining interest rates.
"Almost half of our 13,000 exclusive agencies are now licensed to sell a
broad array of Allstate Financial personal retirement and investment products.
We are improving the integration of sales between our two main business units
as we develop the ability of Allstate agencies to sell a broader range of
financial services products to meet the needs of middle-income households.
"As we continue to aggressively implement many performance improvement
actions, we anticipate that operating income per diluted share in 2002 will be
in the range between $2.50 and $2.70 (excluding restructuring charges). Many
of the pricing and underwriting actions we have been taking must work through
a full renewal cycle, so the improvement in our results will not begin to
emerge until the latter part of 2002. I am confident that the strong actions
we are taking will have a significant impact on our ability to generate
consistent earnings growth in the future," Liddy added.
Consolidated Highlights
Three Months Ended Twelve Months Ended
December 31 December 31
Est. Est.
2001 2000 Change 2001 2000 Change
$ $ % $ $ %
($ in millions,
except per-share
amounts)
Consolidated
Revenues 7,358 7,220 1.9 28,865 29,134 (0.9)
Operating Income
Before Restructuring
Charges After-tax 379 589 (35.7) 1,576 2,042 (22.8)
Operating Income Per
Share (Diluted) Before
Restructuring Charges
After-tax .53 .80 (33.8) 2.18 2.73 (20.1)
Restructuring Charges
After-tax 70 5 -- 84 38 121.1
Operating Income 309 584 (47.1) 1,492 2,004 (25.5)
Operating Income Per
Share (Diluted) .43 .79 (45.6) 2.06 2.68 (23.1)
Realized Capital
(Losses)
Gains After-tax (29) (28) 3.6 (240) 248 (196.8)
Loss on Disposition of
Operations After-tax -- -- -- (40) -- --
Dividends on
Preferred Securities
of Subsidiary Trusts
After-tax (16) (9) 77.8 (45) (41) 9.8
Cumulative Effect of a
Change in Accounting
Principle After-tax -- -- -- (9) -- --
Net Income 264 547 (51.7) 1,158 2,211 (47.6)
Net Income Per Share
(Diluted) .37 .74 (50.0) 1.60 2.95 (45.8)
Weighted Average Shares
Outstanding
(Diluted) 714.7 734.5 (2.7) 723.3 748.7 (3.4)
-- The increase in fourth quarter 2001 consolidated revenues was due to
increased Property-Liability premiums earned partially offset by lower
investment income as compared to the same quarter in the prior year.
-- The consolidated operating income decline in the fourth quarter of 2001
when compared to the prior year fourth quarter was due to:
- increased loss costs in Property-Liability
- increased restructuring expenses
- increased guaranty fund assessments
- decreased Property-Liability net investment income.
These declines were partly offset by:
- increased Property-Liability premiums earned and
- increased Allstate Financial operating income.
-- The previously announced restructuring expenses incurred during the
fourth quarter of 2001 totaled $107 million, or $70 million after-tax
and $0.10 per diluted share. These expenses related to the realignment
of the company's claim offices, Customer Information Centers and other
back-office operations, and a non-cash charge resulting from pension
benefit payments made to agents in connection with the re-organization
of employee agents to a single exclusive agency independent contractor
program announced in 1999. The company expects to incur restructuring
charges during 2002 related to realignment of claim offices and other
back-office operations. The company estimates that the annual expense
savings related to these programs, once complete, will total
approximately $140 million on a pre-tax basis.
-- During the fourth quarter of 2001, Allstate purchased 1 million shares
of its stock, at a cost of $37 million. The total cost of shares
repurchased under its current $500 million repurchase program through
December 31, 2001 is $54 million. The company intends to complete this
repurchase program by December 31, 2002.
-- The Good Hands(R) Network was rolled out to three additional states
during the fourth quarter of 2001. The integrated channel model has
now gone live in 30 states and the District of Columbia, which together
represent almost 90% of the United States' population.
-- The components of pre-tax realized capital gains (losses) were:
Est. Three Months Ended
December 31, 2001
(in millions) Property- Allstate Corporate
Liability Financial and Other Total
Valuation of derivative securities 24 31 -- 55
Portfolio trading 12 (4) 1 9
Investment write-downs (41) (55) -- (96)
Realized Capital Gains (Losses) (5) (28) 1 (32)
Three Months Ended
December 31, 2000
(in millions) Property- Allstate Corporate
Liability Financial and Other Total
Valuation of derivative securities -- -- -- --
Portfolio trading 29 (7) (4) 18
Investment write-downs (35) (28) -- (63)
Realized Capital Gains (Losses) (6) (35) (4) (45)
Est. Twelve Months Ended
December 31, 2001
Property- Allstate Corporate
(in millions) Liability Financial and Other Total
Valuation of derivative securities (28) (59) -- (87)
Portfolio trading 20 (16) 2 6
Investment write-downs (125) (152) -- (277)
Realized Capital Gains (Losses) (133) (227) 2 (358)
Twelve Months Ended
December 31, 2000
Property- Allstate Corporate
(in millions) Liability Financial and Other Total
Valuation of derivative securities -- -- -- --
Portfolio trading 552 18 (41) 529
Investment write-downs (46) (58) -- (104)
Realized Capital Gains (Losses) 506 (40) (41) 425
-- Investment write-downs during the fourth quarter include $24 million
pre-tax of Enron-related securities.
Property-Liability Business
Property-Liability Highlights
Quarter Ended Year Ended
December 31 December 31
Est. Est.
2001 2000 Change 2001 2000 Change
($ in millions, $ $ % $ $ %
except ratios)
Property-Liability
Premiums Written 5,595 5,254 6.5 22,609 21,858 3.4
Property-Liability
Revenues 6,050 5,934 2.0 23,809 24,191 (1.6)
Operating Income
Before Restructuring
Charges After-tax 252 490 (48.6) 1,131 1,584 (28.6)
Restructuring Charges
After-tax 69 5 -- 79 47 68.1
Operating Income 183 485 (62.3) 1,052 1,537 (31.6)
Realized Capital (Losses)
Gains After-tax (4) (3) 33.3 (83) 326 (125.5)
Loss on Disposition
Of Operations
After-tax -- -- -- (40) -- --
Cumulative Effect of a
Change in Accounting
Principle After-tax -- -- -- (3) -- --
Net Income 179 482 (62.9) 926 1,863 (50.3)
Catastrophes Losses 133 123 8.1 894 967 (7.5)
Combined Ratio before
impacts of Catastrophes
and Restructuring
Charges: 100.2 95.1 5.1 pts 98.4 94.5 3.9 pts
Impact of Catastrophe
Losses 2.4 2.3 0.1 pts 4.0 4.4 (0.4)pts
Impact of Restructuring
Charges 1.9 0.1 1.8 pts 0.5 0.3 0.2 pts
Combined Ratio 104.5 97.5 7.0 pts 102.9 99.2 3.7 pts
-- Factors contributing to Property-Liability premium written growth in
the fourth quarter of 2001 as compared to the same quarter in the prior
year included:
- a 7.6% increase in Allstate brand premiums written
- 9.5% in standard auto
- 9.0% in homeowners
These increases were partly offset by profit improvement actions
causing:
- a 6.0% decrease in Allstate brand non-standard auto premium written
- a 5.9% decrease in Ivantage premiums written
-- Factors contributing to the decline in Property-Liability operating
income in the fourth quarter of 2001 when compared to the prior year
fourth quarter include:
- increased loss costs
- increased restructuring expenses
- increased guaranty fund assessments
- decreased net investment income
These adverse factors were partly offset by:
- increased premiums earned
-- Factors contributing to the increased loss costs in the fourth quarter
of 2001 when compared to the prior year fourth quarter were:
- increases in auto loss frequency and severity,
- increases in homeowners loss severity including
- estimated losses related to mold claims in Texas totaling
approximately $75 million pre-tax for the fourth quarter and
approximately $180 million pre-tax for the 2001 year
- a $59 million pre-tax reserve related to the previously announced
preliminary approval of a settlement on the payment of inherent
diminished value on auto claims in Georgia
- a $57 million pre-tax reserve strengthening related to Encompass
losses from current and prior years
-- Results in the fourth quarter of 2001 include expenses of $49 million
pre-tax related to guaranty funds assessments, including the Reliance
Insurance Co. insolvency.
-- Factors contributing to the decline in Property-Liability net
investment income in the fourth quarter of 2001 when compared to the
prior year fourth quarter include:
- lower income from partnership interests
- lower portfolio balances
- lower portfolio yields
-- The Company employs a dynamic process to determine the level of
additional underwriting performance needed to achieve long-term
targeted returns on capital at planned operating leverage. The
Company's intent is to pursue the fully indicated rates to achieve
these returns subject to the regulatory approval process, if any, in a
specific state. During the fourth quarter of 2001 and on a year to
date basis, the following net rate changes have been approved:
Three Months Ended Twelve Months Ended
December 31, 2001 December 31, 2001
Weighted Average Weighted Average
# of Rate Change # of Rate Change
States (%) States (%)
Allstate brand
Standard Auto 20 8.3 38 5.9
Non-standard Auto 23 12.6 45 10.8
Homeowners 25 20.9 40 16.4
Ivantage brand
Standard Auto
(Encompass) 17 2.0 37 2.1
Non-standard Auto
(Deerbrook) 3 16.2 9 12.2
Homeowners
(Encompass) 11 7.9 31 5.0
Allstate Financial Business
Allstate Financial Highlights
Quarter Ended Year Ended
December 31 December 31
Est. Est.
($ in millions) 2001 2000 Change 2001 2000 Change
$ $ % $ $ %
Statutory Premiums and
Deposits 2,311 2,665 (13.3) 10,605 12,245 (13.4)
Allstate Financial
GAAP Revenues 1,287 1,266 1.7 4,971 4,880 1.9
Operating Income
before Restructuring
Charges After-tax 148 115 28.7 532 511 4.1
Restructuring Charges
After-tax 1 -- -- 5 (9) (155.6)
Operating Income 147 115 27.8 527 520 1.3
Realized Capital Gains
(Losses) After-tax (25) (22) 13.6 (158) (51) --
Cumulative Effect of a
Change in Accounting
Principle After-tax -- -- -- (6) -- --
Net Income 122 93 31.2 363 469 (22.6)
Investments including
Separate Accounts 59,653 55,552 7.4 59,653 55,552 7.4
-- Factors contributing to the decline in statutory premiums and deposits
during the fourth quarter of 2001 as compared to the same quarter in
the prior year included:
- a decrease in retail sales of variable annuities primarily due to
equity market volatility.
This decrease was partly offset by:
- growth in fixed annuity sales
- growth in the sale of life products
-- Factors contributing to the growth in Allstate Financial operating
income in the fourth quarter of 2001 when compared to the prior year
fourth quarter included:
- management actions to improve the gross investment margin
- an improved mortality margin
- aggressive expense management
- reserves and investment income recognition adjustments of
$13 million
This press release contains forward-looking statements about the
profitability of Allstate's homeowners line of business, our loss ratio for
Allstate standard auto, our operating income for 2002, restructuring charges
and expense savings, and rate changes in our Property-Liability business.
These statements are subject to the Private Securities Litigation Reform Act
of 1995 and are based on management's estimates, assumptions and projections.
Actual results may differ materially from those projected in the forward-
looking statements for a variety of reasons. Loss costs in our Property-
Liability business, including losses due to catastrophes such as hurricanes
and earthquakes, may exceed management's projections. Competitive pressures
could lead to sales of Property-Liability products, including private
passenger auto and homeowners insurance, that are lower than projected by
management, as we increase prices and modify our underwriting practices.
Investment income may not meet management's projections due to declining
interest rates and poor stock market performance. Expense savings are
dependent on the adequacy and timing of actions taken to consolidate
operations and facilities. Projected weighted average rate changes in our
Property-Liability business may be lower than projected due to a decrease in
the number of policies in force. Readers are encouraged to review the other
risk factors facing Allstate that we disclose in our current, quarterly and
annual reports to the Securities and Exchange Commission on Forms 8-K, 10-Q
and 10-K. We undertake no obligation to publicly correct or update any
forward-looking statements. The press release contains unaudited financial
information.
The supplemental operating information included in the tables above allows
for additional analysis of results of operations. The net effects of realized
capital gains and losses have been excluded due to the volatility between
periods and because such data is often excluded when evaluating the overall
financial performance of insurers. After-tax realized capital gains and losses
are presented net of the effects of Allstate Financial's deferred policy
acquisition cost amortization to the extent that such effects resulted from
the recognition of realized capital gains and losses. Operating income should
not be considered as a substitute for any generally accepted accounting
principles ("GAAP") measure of performance. The method of calculating
operating income may be different from the method used by other companies and
therefore comparability may be limited.
The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held
personal lines insurer. Widely known through the "You're In Good Hands With
Allstate(R)" slogan, Allstate provides insurance products to more than
14 million households and has approximately 13,000 exclusive agents in the
U.S. and Canada. Customers can access Allstate products and services through
Allstate agents, or in select states at allstate.com and 1-800-Allstate.
Encompass(SM) and Deerbrook(SM) Insurance brand property and casualty products
are sold exclusively through independent agents. Allstate Financial Group
includes the businesses that provide life insurance, retirement and investment
products, through Allstate agents, workplace marketing, independent agents,
banks and securities firms.
The Allstate Corporation prepares an interim investor supplement,
containing standard information that is not available at the time of the
earnings release. A supplement will be posted to the company's website in
approximately 10 days, and can be accessed by going to the Allstate web site
at allstate.com and clicking on "About Allstate." From there, go to the "Find
Financial Information" button.
THE ALLSTATE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended
December 31,
Est. Percent
($ in millions except per share data) 2001 2000 Change
Revenues
Property-liability insurance
premiums $5,644 $5,452 3.5
Life and annuity premiums
and contract charges 565 582 (2.9)
Net investment income 1,181 1,231 (4.1)
Realized capital gains and losses (32) (45) (28.9)
Total revenues 7,358 7,220 1.9
Costs and expenses
Property-liability insurance
claims and claims expense 4,439 3,983 11.4
Life and annuity contract benefits 842 878 (4.1)
Amortization of deferred policy
acquisition costs 896 816 9.8
Operating costs and expenses 703 745 (5.6)
Amortization of goodwill 14 15 (6.7)
Restructuring and related charges 107 8 --
Interest expense 62 63 (1.6)
Total costs and expenses 7,063 6,508 8.5
Loss on disposition of operations -- -- --
Income from operations before income
tax expense, dividends on preferred
securities and cumulative effect of
change in accounting principle, after tax 295 712 (58.6)
Income tax expense 15 156 (90.4)
Income before dividends on preferred
securities and cumulative effect of
change in accounting principle, after tax 280 556 (49.6)
Dividends on preferred securities
of subsidiary trusts (16) (9) 77.8
Cumulative effect of change in
accounting principle, after-tax -- -- --
Net income $264 $547 (51.7)
Net income per share - Basic $0.37 $0.75
Weighted average shares - Basic 712.7 730.2
Net income per share - Diluted $0.37 $0.74
Weighted average shares - Diluted 714.7 734.5
THE ALLSTATE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Twelve Months Ended
December 31,
Est. Percent
($ in millions except per share data) 2001 2000 Change
Revenues
Property-liability insurance premiums $22,197 $21,871 1.5
Life and annuity premiums
and contract charges 2,230 2,205 1.1
Net investment income 4,796 4,633 3.5
Realized capital gains and losses (358) 425 (184.2)
Total revenues 28,865 29,134 (0.9)
Costs and expenses
Property-liability insurance
claims and claims expense 17,532 16,395 6.9
Life and annuity contract benefits 3,404 3,190 6.7
Amortization of deferred policy
acquisition costs 3,462 3,458 0.1
Operating costs and expenses 2,688 2,703 (0.6)
Amortization of goodwill 54 53 1.9
Restructuring and related charges 129 59 118.6
Interest expense 248 229 8.3
Total costs and expenses 27,517 26,087 5.5
Loss on disposition of operations (63) -- --
Income from operations before income
tax expense, dividends on preferred
securities and cumulative effect of
change in accounting principle,
after tax 1,285 3,047 (57.8)
Income tax expense 73 795 (90.8)
Income before dividends on preferred
securities and cumulative effect of
change in accounting principle,
after tax 1,212 2,252 (46.2)
Dividends on preferred securities
of subsidiary trusts (45) (41) 9.8
Cumulative effect of change in
accounting principle, after-tax (9) -- --
Net income $1,158 $2,211 (47.6)
Net income per share - Basic $1.61 $2.97
Weighted average shares - Basic 720.2 744.0
Net income per share - Diluted $1.60 $2.95
Weighted average shares - Diluted 723.3 748.7
THE ALLSTATE CORPORATION
CONTRIBUTION TO INCOME
Three Months Ended
December 31,
($ in millions except
per share data) Est. Percent
2001 2000 Change
Contribution to income
Operating income $309 $584 (47.1)
Realized capital gains and losses (29) (28) 3.6
Loss on disposition of operations -- -- --
Dividends on preferred securities
of subsidiary trusts (16) (9) 77.8
Cumulative effect of change in
accounting principle -- -- --
Net income $264 $547 (51.7)
Operating income before the impact
of restructuring and related charges $379 $589 (35.7)
Income per share (Diluted)
Operating income $0.43 $0.79 (45.6)
Realized capital gains and losses (0.04) (0.03) 33.3
Loss on disposition of operations -- -- --
Dividends on preferred securities
of subsidiary trusts (0.02) (0.02) -
Cumulative effect of change in
accounting principle -- -- --
Net income $0.37 $0.74 (50.0)
Operating income before the impact
of restructuring and related charges $0.53 $0.80 (33.8)
Book value per share - Diluted $24.08 $23.80 1.2
THE ALLSTATE CORPORATION
CONTRIBUTION TO INCOME
Twelve Months Ended
December 31,
($ in millions except
per share data) Est. Percent
2001 2000 Change
Contribution to income
Operating income $1,492 $2,004 (25.5)
Realized capital gains and losses (240) 248 (196.8)
Loss on disposition of operations (40) -- --
Dividends on preferred securities
of subsidiary trusts (45) (41) 9.8
Cumulative effect of change in
accounting principle (9) -- --
Net income $1,158 $2,211 (47.6)
Operating income before the impact
of restructuring and related charges $1,576 $2,042 (22.8)
Income per share (Diluted)
Operating income $2.06 $2.68 (23.1)
Realized capital gains and losses (0.33) 0.33 --
Loss on disposition of operations (0.06) -- --
Dividends on preferred securities
of subsidiary trusts (0.06) (0.06) --
Cumulative effect of change in
accounting principle (0.01) -- --
Net income $1.60 $2.95 (45.8)
Operating income before the impact
of restructuring and related charges $2.18 $2.73 (20.1)
Book value per share - Diluted $24.08 $23.80 1.2
THE ALLSTATE CORPORATION
SUPPLEMENTARY INFORMATION
Twelve Months
Three Months Ended Ended
December 31, December 31,
Est. Est.
($ in millions except ratios) 2001 2000 2001 2000
Property-Liability
Premiums written $5,595 $5,254 $22,609 $21,858
Premiums earned $5,644 $5,452 $22,197 $21,871
Claims and claims expense 4,439 3,983 17,532 16,395
Operating costs and expenses 1,347 1,321 5,174 5,208
Amortization of goodwill 5 6 21 23
Restructuring and related charges 105 8 121 72
Underwriting (loss) income (252) 134 (651) 173
Net investment income 411 488 1,745 1,814
Income tax (benefit) expense on
operations (24) 137 42 450
Operating income 183 485 1,052 1,537
Realized capital gains and losses,
after-tax (4) (3) (83) 326
Loss on disposition of operations,
after-tax -- -- (40) --
Cumulative effect of change in
accounting
principle, after-tax -- -- (3) --
Net income $179 $482 $926 $1,863
Catastrophe losses $133 $123 $894 $967
Operating ratios
Claims and claims expense ratio 78.7 73.1 79.0 75.0
Expense ratio 25.8 24.4 23.9 24.2
Combined ratio 104.5 97.5 102.9 99.2
Effect of catastrophe losses
on combined ratio 2.4 2.3 4.0 4.4
Effect of restructuring and
related charges
on combined ratio 1.9 0.1 0.5 0.3
Allstate Financial
Statutory premiums and deposits $2,311 $2,665 $10,605 $12,245
Investments including
Separate Account assets $59,653 $55,552 $59,653 $55,552
Premiums and contract charges $565 $582 $2,230 $2,205
Net investment income 750 719 2,968 2,715
Contract benefits 842 878 3,404 3,190
Operating costs and expenses 240 240 952 915
Amortization of goodwill 7 9 29 30
Restructuring and related charges 2 -- 8 (13)
Income tax expense on operations 77 59 278 278
Operating income 147 115 527 520
Realized capital gains and losses,
after-tax (25) (22) (158) (51)
Cumulative effect of change in
accounting
principle, after-tax -- -- (6) --
Net income $122 $93 $363 $469
Corporate and Other
Net investment income 20 24 83 104
Operating costs and expenses 65 63 255 229
Amortization of goodwill 2 - 4 -
Income tax benefit on operations (26) (23) (89) (72)
Operating loss $(21) $(16) $(87) $(53)
Realized capital gains and losses,
after-tax -- (3) 1 (27)
Dividends on preferred securities
of subsidiary trusts (16) (9) (45) (41)
Net loss $(37) $(28) $(131) $(121)
THE ALLSTATE CORPORATION
UNDERWRITING RESULTS BY AREA OF BUSINESS
Three Months Ended Twelve Months Ended
($ in millions except
ratios) December 31, December 31,
Est. Percent Est. Percent
2001 2000 Change 2001 2000 Change
Consolidated
Underwriting Summary
PP&C $(241) $131 -- $(627) $187 --
Discontinued lines
and coverages (11) 3 -- (24) (14) 71.4
Underwriting
(loss) income $(252) $134 -- $(651) $173 --
PP&C Underwriting
Summary
Premiums written $5,595 $5,253 6.5 $22,601 $21,856 3.4
Premiums earned $5,640 $5,452 3.4 $22,182 $21,868 1.4
Claims and claims
expense 4,430 3,987 11.1 17,506 16,386 6.8
Other costs and
expenses 1,342 1,321 1.6 5,162 5,201 (0.7)
Amortization of
goodwill 5 6 (16.7) 21 23 (8.7)
Restructuring and
related charges 104 7 -- 120 71 69.0
Underwriting
(loss) income $(241) $131 -- $(627) $187 --
Catastrophe losses $133 $123 8.1 $894 $967 (7.5)
Operating ratios
Claims and claims
expense ratio 78.6 73.1 78.9 74.9
Expense ratio 25.7 24.5 23.9 24.2
Combined ratio 104.3 97.6 102.8 99.1
Effect of catastrophe
losses on combined
ratio 2.4 2.3 4.0 4.4
Effect of restructuring
and related charges on
combined ratio 1.8 0.1 0.5 0.3
Discontinued Lines
and Coverages Underwriting
Summary
Premiums written $-- $1 $8 $2
Premiums earned $4 $-- $15 $3
Claims and claims
expense 9 (4) 26 9
Other costs and
expenses 5 -- 12 7
Restructuring and
related charges 1 1 1 1
Underwriting
(loss) income $(11) $3 $(24) $(14)
THE ALLSTATE CORPORATION
PROPERTY-LIABILITY PREMIUMS WRITTEN BY MARKET SEGMENT
($ in millions)
Three Months Ended Twelve Months Ended
December 31, December 31,
Est. Percent Est. Percent
2001 2000 Change 2001 2000 Change
ALLSTATE-BRAND
Standard auto (a) $3,064 $2,797 9.5 $12,115 $11,314 7.1
Non-standard auto
(a) 598 636 (6.0) 2,625 2,957 (11.2)
Involuntary auto 54 22 145.5 171 67 155.2
Commercial lines 185 168 10.1 725 665 9.0
Homeowners 1,001 918 9.0 3,943 3,677 7.2
Other personal
lines 278 271 2.6 1,217 1,193 2.0
5,180 4,812 7.6 20,796 19,873 4.6
IVANTAGE
Standard auto 272 281 (3.2) 1,190 1,253 (5.0)
Non-standard auto 12 16 (25.0) 46 148 (68.9)
Involuntary auto 2 11 (81.8) 17 21 (19.0)
Homeowners 108 106 1.9 456 441 3.4
Other personal
lines 21 27 (22.2) 96 120 (20.0)
415 441 (5.9) 1,805 1,983 (9.0)
PERSONAL PROPERTY
AND CASUALTY 5,595 5,253 6.5 22,601 21,856 3.4
DISCONTINUED LINES
AND COVERAGES -- 1 -- 8 2 --
PROPERTY-LIABILITY $5,595 $5,254 6.5 $22,609 $21,858 3.4
(a) To conform to fourth quarter 2001 classifications of standard and non-
standard auto, certain prior quarter balances have been reclassified.
THE ALLSTATE CORPORATION
PERSONAL PROPERTY AND CASUALTY MARKET SEGMENT ANALYSIS
($ in millions)
Three Months Ended December 31,
Est. Est. Est.
2001 2000 2001 2000 2001 2000
Loss Ratio
Excluding the
Effect
of Catastrophe
Premiums Earned Loss Ratio Losses
ALLSTATE-BRAND
Standard auto $3,038 $2,849 80.0 70.8 79.8 70.7
Non-standard auto 640 691 81.7 105.5 81.7 104.6
Homeowners 978 934 66.3 55.2 54.2 46.1
IVANTAGE
Standard auto 299 324 100.0 73.8 99.3 74.1
Non-standard auto 11 29 100.0 148.3 100.0 148.3
Homeowners 115 118 86.1 80.5 80.0 66.1
OTHER (a) 559 507 75.0 68.4 75.1 66.3
PERSONAL PROPERTY AND CASUALTY $5,640 $5,452 78.6 73.1 76.2 70.8
Twelve Months Ended December 31,
Est. Est.
Est. 2001 2000 2001 2000 2001 2000
Loss Ratio
Excluding the
Effect
of
Catastrophe
Premiums Earned Loss Ratio Losses
ALLSTATE-BRAND
Standard auto $11,846 $11,237 75.4 70.3 74.3 69.0
Non-standard auto 2,689 3,053 83.0 91.8 82.3 90.7
Homeowners 3,799 3,577 85.3 69.2 70.1 51.9
IVANTAGE
Standard auto 1,209 1,307 86.4 79.0 85.4 77.9
Non-standard auto 53 198 81.1 135.4 81.1 134.8
Homeowners 460 473 82.8 74.2 69.1 56.7
OTHER (a) 2,126 2,023 76.6 77.1 72.7 73.5
PERSONAL PROPERTY AND CASUALTY $22,182 $21,868 78.9 74.9 74.9 70.5
(a) Other includes Allstate-brand and Ivantage involunatry auto and other
personal lines and Allstate-brand commercial lines.
SOURCE Allstate Insurance Company
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Moews, or Phil Dorn, +1-847-402-2800, all of Allstate Insurance
Company
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