Allstate’s Net Income Grew 52 Percent Higher; Auto Underwriting Improved

February 4, 2021

Insurer Allstate reported improved auto underwriting results and strong investment returns for the 2020 fourth quarter.

Net income was up 52 percent to $2.6 billion for the quarter compared to net income of $1.7 billion in the same quarter in 2019.

Net investment income rose 73 percent to $1.19 billion.

The results reflected fewer auto accidents and higher home insurance premiums along with increased catastrophe losses. The 79.1 combined ratio for the quarter compared to 84.9 in the fourth quarter if 2019, indicating lower non-catastrophe losses, higher premiums earned and lower underwriting expenses.

Property/casualty insurance earned premiums of $8.8 billion were about the same as the prior year’s fourth quarter.

Catastrophe losses were not about the same. Allstate had $424 million in catastrophe claims in 2020’s last quarter, compared to $295 million in the fourth quarter the year before.

“Amidst the 2020 pandemic, Allstate served customers well, made progress in building higher growth business models and generated excellent returns for shareholders,” said Tom Wilson, chair, president and CEO.

Wilson said “total growth and return prospects also improve” with the pending acquisition of National General, which was announced in July.

The company is currently transitioning and streamlining its distribution. Esurance is being integrated into the Allstate brand. In October, the insurer announced it would be laying off 3,800 employees as part of its efficiency moves. It is also selling most of its life insurance business to Blackstone Group as part of its strategy to grow market share in personal lines property/casualty lines.

Additional Q4 2020 Results:

Source: Allstate

*This story appeared previously in our sister publication Insurance Journal.