[February 07, 2018] |
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Allstate Delivers Strong Results
The Allstate Corporation (NYSE: ALL) today reported financial results
for the fourth quarter of 2017.
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The Allstate Corporation Consolidated Highlights
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Three months ended
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Twelve months ended
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December 31,
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December 31,
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($ in millions, except per share data and ratios)
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% / pts
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% / pts
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2017
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2016
|
Change
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|
|
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2017
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2016
|
Change
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Consolidated revenues
|
|
|
$
|
9,843
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|
$
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9,278
|
|
6.1
|
|
|
|
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$
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38,524
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$
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36,534
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5.4
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Net income applicable to common shareholders(1)
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1,220
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811
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50.4
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3,073
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1,761
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74.5
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per diluted common share
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3.35
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2.18
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|
53.7
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8.36
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4.67
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79.0
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Adjusted net income*(2)
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|
762
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|
807
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(5.6
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)
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2,467
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1,838
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34.2
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per diluted common share*
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2.09
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2.17
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(3.7
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)
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6.71
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4.87
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37.8
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Return on common shareholders' equity (trailing twelve months)
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Net income applicable to common shareholders
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15.5
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%
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9.5
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%
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6.0
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Adjusted net income*
|
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|
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13.3
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%
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10.4
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%
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2.9
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Book value per common share
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57.58
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50.77
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13.4
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Property-Liability combined ratio
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Recorded
|
|
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91.0
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89.7
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1.3
|
|
|
|
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93.6
|
|
96.0
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(2.4
|
)
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Underlying combined ratio* (excludes catastrophes, prior year
reserve reestimates and amortization of purchased intangibles)
|
|
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85.7
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87.4
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(1.7
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)
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|
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84.9
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87.6
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(2.7
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)
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Underlying combined ratio* as historically reported (includes
Service Businesses)
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|
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85.6
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87.9
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(2.3
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)
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Catastrophe losses
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599
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|
303
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97.7
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|
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3,234
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2,572
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25.7
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Total policies in force (in thousands)
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82,276
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43,811
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87.8
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(1)
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2017 results include a tax legislation benefit of $506 million
related to the Tax Cuts and Jobs Act of 2017, primarily due to the
revaluation of Allstate's deferred tax assets and liabilities. The
impact of tax legislation is excluded from adjusted net income.
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(2)
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In the fourth quarter, Allstate discontinued the use of the term
"operating income" and replaced the label with "adjusted net income".
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*
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Measures used in this release that are not based on accounting
principles generally accepted in the United States of America
("non-GAAP") are denoted with an asterisk and defined and reconciled
to the most directly comparable GAAP measure in the "Definitions of
Non-GAAP Measures" section of this document.
|
"In 2017, Allstate excelled at delivering strong current results and
implementing multiple initiatives to drive long-term profitable growth,"
said Tom Wilson, Chairman and Chief Executive Officer of The Allstate
Corporation. "Policies in force reached 82.3 million, revenues grew 5%
to $38.5 billion and net income was $3.07 billion due to strong
performance from our market-facing businesses and investments. The Tax
Cuts and Jobs Act resulted in a $506 million increase to net income and
will provide future additional resources to accelerate the company's
strategies. Fourth quarter adjusted net income* was $762 million,
excluding the impact of tax reform and goodwill impairment related to
changes in reportable segments, as auto and homeowners insurance margins
remained strong and performance-based investments had outstanding
results. Adjusted net income return on equity* was 13.3% for 2017 and
book value per share increased by 13.4% for the year. Shareholders
received cash returns of $1.9 billion in 2017, which was 6% of the
average market capitalization, through a combination of dividends and
share repurchases."
"This operational strength will enable us to accelerate growth in 2018
while maintaining attractive returns. Allstate brand policies in force
increased in the fourth quarter from the third quarter, reflecting a
shift earlier in the year from improving auto insurance margins to
growing profitably. We expect the underlying combined ratio* for the
Property-Liability business to be between 86 and 88(1) for
2018, including additional growth investments as a result of the recent
tax cuts. Investments in marketing, distribution, telematics, new
products and technology are being accelerated. Allstate Benefits,
SquareTrade and Esurance are also expected to contribute to growth in
2018. Reflecting this outlook and a reduction in the U.S. federal income
tax rate, the quarterly dividend has been increased 24% to 46 cents per
share for the first quarter of 2018."
"The reduction in federal taxes also enables us to enhance the employee
value proposition and improve local communities," continued Wilson.
"Employees will receive either $1,000 or $2,000 of 'Choice Dollars' in
2018, which can be taken as a cash bonus or contributed to a 401(k) or
health savings account. This structure of employee choice will be
incorporated into future benefit design. Allstate will also increase
employee training in technology literacy to support sustainable
employability. An additional $34 million was contributed to The Allstate
Foundation in 2017 to expand existing programs and Allstate agency
support for local causes. Allstate will remain focused on creating
prosperity for all of our stakeholders," concluded Wilson.
Operating Results: Fourth Quarter 2017
-
Total revenue of $9.8 billion in the fourth quarter of 2017 increased
6.1% compared to the prior year quarter.
-
Property and casualty insurance premiums increased 3.8%.
-
Life premiums and contract charges increased 4.7%.
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Net investment income increased 14.0%.
-
Realized capital gains were $127 million compared to $2 million in the
prior year quarter.
-
Net income applicable to common shareholders was $1.22 billion, or
$3.35 per diluted share, in the fourth quarter of 2017, compared to
$811 million, or $2.18 per diluted share, in the fourth quarter of
2016, primarily driven by the reduction to income tax expense
following the passage of the Tax Cuts and Jobs Act. The creation of
new segments for financial reporting led to goodwill impairment of
$125 million related to goodwill that was reallocated to the new
Allstate Annuities segment, as previously disclosed. Adjusted net
income* was $762 million in the fourth quarter of 2017, compared to
$807 million in the fourth quarter of 2016, as improved underlying
performance and favorable prior year reserve reestimates were offset
by higher catastrophe losses and expenses.
-
The 2017 full year underlying combined ratio* for the
Property-Liability and Service Businesses of 85.6 was better than the
annual outlook range of 87-89.
-
Property-Liability underwriting income of $715 million was $86
million below the prior year quarter, primarily due to higher
catastrophe losses and increased compensation costs. These costs
partially offset the positive impact of increased premiums earned,
lower underlying loss costs and higher favorable prior year reserve
reestimates.
-
The underlying combined ratio* of 85.7 for the fourth quarter was 1.7
points lower than the prior year period, reflecting improvement in the
auto insurance underlying combined ratio for all three underwritten
brands.
-
Non-catastrophe prior year reserve releases of $175 million in the
fourth quarter of 2017 included Allstate brand releases of $169
million, primarily driven by Allstate brand auto injury coverages.
_________
(1)
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A reconciliation of this non-GAAP measure to the combined ratio, a
GAAP measure, is not possible on a forward-looking basis because it
is not possible to provide a reliable forecast of catastrophes, and
prior year reserve reestimates are expected to be zero because
reserves are determined based on our best estimate of ultimate loss
reserves as of the reporting date.
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Property-Liability Results
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Three months ended
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Twelve months ended
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December 31,
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December 31,
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(% to earned premiums)
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pts
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pts
|
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2017
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2016
|
|
Change
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|
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2017
|
|
2016
|
|
Change
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Recorded Combined Ratio
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91.0
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89.7
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1.3
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93.6
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96.0
|
|
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(2.4
|
)
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Allstate Brand Auto
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91.9
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|
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95.3
|
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(3.4
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)
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93.2
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98.7
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(5.5
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)
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Allstate Brand Homeowners
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85.4
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68.7
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16.7
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89.4
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83.7
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5.7
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Allstate Brand Other Personal Lines
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84.5
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87.1
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(2.6
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)
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93.1
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89.6
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3.5
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Esurance
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100.2
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105.0
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(4.8
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)
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103.3
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107.5
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(4.2
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)
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Encompass
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106.4
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90.0
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16.4
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103.0
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99.9
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3.1
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Underlying Combined Ratio*
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85.7
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87.4
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(1.7
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)
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84.9
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87.6
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(2.7
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)
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Allstate Brand Auto
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94.2
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96.2
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(2.0
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)
|
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92.2
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96.5
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(4.3
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)
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Allstate Brand Homeowners
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59.9
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59.1
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0.8
|
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60.5
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59.5
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1.0
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Allstate Brand Other Personal Lines
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77.8
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76.7
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1.1
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80.4
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78.5
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1.9
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Esurance
|
|
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99.8
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105.0
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(5.2
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)
|
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100.2
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105.2
|
|
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(5.0
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)
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Encompass
|
|
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86.4
|
|
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90.7
|
|
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(4.3
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)
|
|
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86.5
|
|
|
90.3
|
|
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(3.8
|
)
|
|
|
|
|
|
|
|
|
|
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|
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-
Allstate brand auto net written premium grew 4.2% in the fourth
quarter of 2017, reflecting a 4.5% increase in average premium
compared to the prior year quarter, which was partially offset by a
0.8% decline in policies in force. Policies in force grew 0.3%
compared to the third quarter of 2017 on continued improvement in the
renewal ratio and new issued applications.
-
The recorded combined ratio of 91.9 in the fourth quarter of 2017 was
3.4 points better than the prior year quarter due to a broad-based
decline in accident frequency, increased premiums earned and higher
favorable prior year reserve reestimates. The underlying combined
ratio* in the current quarter was 2.0 points better than the prior
year quarter.
-
Allstate brand homeowners net written premium increased 3.4% in
the fourth quarter of 2017 compared to the prior year quarter,
reflecting an increase in average premium. Policies in force declined
0.5% compared to the prior year quarter, but grew 0.3% compared to the
third quarter of 2017. The renewal ratio of 87.5 was unchanged and new
issued applications grew.
-
The recorded combined ratio of 85.4 in the fourth quarter of 2017
includes the impact of increased catastrophe losses, while the
underlying combined ratio* of 59.9 continued to reflect strong
underlying profitability.
-
Allstate brand other personal lines net written premium of $410
million increased 4.3% in the fourth quarter of 2017 compared to the
prior year quarter. The recorded combined ratio of 84.5 was 2.6 points
better than the prior year quarter, primarily driven by lower
catastrophe losses. The underlying combined ratio* was 77.8 in the
fourth quarter of 2017.
-
Esurance net written premium growth of 2.8% compared to the
prior year quarter reflects increased average premium in auto and
homeowners insurance, partially offset by a decline in auto policies
in force. The strategy to drive higher growth across all lines of
business continued to make progress as homeowners insurance policies
in force increased 36.2%, with written premium of $79 million in 2017.
-
The recorded combined ratio of 100.2 in the fourth quarter of 2017
improved 4.8 points compared to the prior year quarter, primarily
driven by a lower expense ratio. The underlying combined ratio* of
99.8 was 5.2 points better than the prior year quarter, as both auto
and homeowners insurance results improved.
-
Encompass net written premium declined 7.6% in the fourth
quarter of 2017 compared to the prior year quarter, reflecting the
continued execution of profit improvement plans. The recorded combined
ratio of 106.4 in the fourth quarter of 2017 was 16.4 points higher
than the prior year quarter, due to catastrophe losses from California
wildfires which was partially offset by lower underlying loss costs.
The underlying combined ratio* of 86.4 for the fourth quarter was 4.3
points lower than the prior year quarter.
-
Service Businesses, a new reportable segment, offers a broad
range of products and services that expand and enhance customer value
propositions. Our strategy to deliver superior value propositions and
build strategic platforms continued in the fourth quarter as policies
in force grew to 43.5 million, an increase of 4.6 million compared to
the third quarter of 2017, driven by growth in SquareTrade.
-
Adjusted net loss of $24 million in the fourth quarter of 2017 was
primarily due to investments in Arity's research and development, a
SquareTrade restructuring charge and the deployment of a new digital
platform in Allstate Roadside Services.
|
Service Businesses Results
|
|
|
|
Three months ended
|
|
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Twelve months ended
|
|
|
|
|
December 31,
|
|
|
|
December 31,
|
|
($ in millions)
|
|
|
|
|
|
|
%
|
|
|
|
|
|
|
|
%
|
|
|
|
|
2017
|
|
2016
|
|
Change
|
|
|
|
2017
|
|
2016
|
|
Change
|
|
Total Revenues
|
|
|
$
|
264
|
|
|
$
|
181
|
|
|
45.9
|
|
|
|
$
|
993
|
|
|
$
|
698
|
|
|
42.3
|
|
SquareTrade
|
|
|
89
|
|
|
-
|
|
|
-
|
|
|
|
296
|
|
|
-
|
|
|
-
|
|
Allstate Roadside Services
|
|
|
72
|
|
|
81
|
|
|
(11.1
|
)
|
|
|
300
|
|
|
340
|
|
|
(11.8
|
)
|
Allstate Dealer Services
|
|
|
83
|
|
|
75
|
|
|
10.7
|
|
|
|
318
|
|
|
283
|
|
|
12.4
|
|
Arity
|
|
|
20
|
|
|
25
|
|
|
(20.0
|
)
|
|
|
79
|
|
|
75
|
|
|
5.3
|
|
Adjusted Net (Loss) / Income
|
|
|
(24
|
)
|
|
1
|
|
|
NM
|
|
|
|
(59
|
)
|
|
3
|
|
|
NM
|
|
SquareTrade
|
|
|
(11
|
)
|
|
-
|
|
|
-
|
|
|
|
(22
|
)
|
|
-
|
|
|
-
|
|
Allstate Roadside Services
|
|
|
(7
|
)
|
|
(5
|
)
|
|
40.0
|
|
|
|
(20
|
)
|
|
(12
|
)
|
|
66.7
|
|
Allstate Dealer Services
|
|
|
-
|
|
|
2
|
|
|
(100.0
|
)
|
|
|
(2
|
)
|
|
4
|
|
|
(150.0
|
)
|
Arity
|
|
|
(6
|
)
|
|
4
|
|
|
NM
|
|
|
|
(15
|
)
|
|
11
|
|
|
NM
|
|
NM = not meaningful
-
SquareTrade revenue was $89 million in the fourth quarter, and
policies in force grew to 38.7 million, an increase of 4.6 million
policies compared to the third quarter of 2017. Adjusted net loss was
$11 million in the fourth quarter of 2017.
-
Allstate Roadside Services revenue in the fourth quarter of
2017 declined 11.1% compared to the prior year quarter, reflecting
non-renewal of unprofitable third-party contracts. An adjusted net
loss of $7 million was realized as the new digital platform, which
reduces response time, is not yet profitable.
-
Allstate Dealer Services revenue grew 10.7% compared to the
fourth quarter of 2016 and adjusted net income broke even.
-
Arity affiliate revenues were $20 million in the fourth quarter
of 2017, generating an adjusted net loss of $6 million.
-
Allstate Life adjusted net income was $57 million in the fourth
quarter of 2017, $9 million lower than the prior year quarter,
primarily due to increased contract benefits and operating expenses
partially offset by higher premiums. Premiums and contract charges
increased 1.9% in the fourth quarter compared to the prior year
quarter, primarily related to higher traditional life insurance
renewal premiums and lower levels of reinsurance premiums ceded.
-
Allstate Benefits adjusted net income was $20 million in the
fourth quarter of 2017, $3 million lower than the prior year quarter,
primarily due to higher contract benefits and operating expenses,
partially offset by higher premiums. Premiums and contract charges
increased 8.3% in the fourth quarter compared to the prior year
quarter, due to 7.4% growth in policies in force in 2017.
-
Allstate Annuities adjusted net income was $55 million in the
fourth quarter of 2017, $14 million higher than the prior year
quarter, primarily due to higher performance-based investment income.
Policies in force declined 8.0% in 2017 as the business continues to
run off.
-
Allstate Investments $83 billion portfolio generated net
investment income of $913 million in the fourth quarter, which was
14.0% above the prior year quarter.
|
Allstate Investment Results
|
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
($ in millions, except ratios)
|
|
|
|
|
|
|
% / pts
|
|
|
|
|
|
|
% / pts
|
|
|
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
Net investment income
|
|
|
$
|
913
|
|
|
$
|
801
|
|
|
14.0
|
|
|
$
|
3,401
|
|
|
$
|
3,042
|
|
|
11.8
|
Market-based investment income(1)
|
|
|
664
|
|
|
654
|
|
|
1.5
|
|
|
2,656
|
|
|
2,598
|
|
|
2.2
|
Performance-based investment income(1)
|
|
|
296
|
|
|
182
|
|
|
62.6
|
|
|
917
|
|
|
579
|
|
|
58.4
|
Realized capital gains and losses
|
|
|
127
|
|
|
2
|
|
|
NM
|
|
|
445
|
|
|
(90
|
)
|
|
NM
|
Change in unrealized net capital gains, pre-tax
|
|
|
(120
|
)
|
|
(1,245
|
)
|
|
NM
|
|
|
857
|
|
|
745
|
|
|
15.0
|
Total return on investment portfolio
|
|
|
1.1
|
%
|
|
(0.7
|
)%
|
|
1.8
|
|
|
5.9
|
%
|
|
4.4
|
%
|
|
1.5
|
(1) Investment expenses are not allocated between
market-based and performance-based portfolios with the exception of
investee level expenses.
NM = not meaningful
-
Market-based investments contributed stable earnings, primarily
from fixed income securities. Market-based investment income of $664
million in the fourth quarter of 2017 increased over the prior year
quarter, reflecting higher invested assets and stable portfolio yields.
-
Performance-based investments generated income of $296 million
in the fourth quarter of 2017, which increased 62.6% over the prior
year quarter, reflecting asset appreciation, sales of underlying
investments and the continued growth of the portfolio, across private
equity and real estate.
-
Net realized capital gains were $127 million in the fourth
quarter of 2017, compared to gains of $2 million in the prior year
quarter. Net realized gains on sales of $146 million were partially
offset by impairments of $13 million and derivative losses of $6
million.
-
Unrealized net capital gains decreased $120 million in the
fourth quarter of 2017 as lower fixed income valuations offset
positive equity markets.
-
Total return on the investment portfolio included approximately
1% per quarter from investment income, as well as changes in the
portfolio value between quarters. Total return was 1.1% for the fourth
quarter, with positive equity returns offset by lower fixed income
valuations. Beginning in 2018, equity valuation changes will be
included in net income due to the adoption of new accounting standards.
Full Year 2017 Financial Highlights
-
Allstate delivered on all five 2017 Operating Priorities which focus
on both near-term performance and long-term value creation.
-
Better Serve Our Customers: The Net Promoter Score, which
measures how likely customers are to recommend us, increased
throughout 2017. Allstate brand auto insurance retention improved in
the second half of 2017, and Esurance auto and homeowners insurance
retention increased 2.1 points and 2.9 points, respectively, for the
full year compared to 2016. If favorable trends in customer retention
continue in 2018, this will support higher future growth.
-
Achieve Target Economic Returns on Capital: The
Property-Liability recorded combined ratio of 93.6 generated $2.0
billion in underwriting income for the year. Auto insurance
underwriting income increased $1.1 billion in 2017 from the prior
year, due to lower accident frequency, higher premiums and favorable
prior year reserve reestimates of $490 million. Allstate brand
homeowners insurance posted a combined ratio of 89.4, despite
significant catastrophe events. The homeowners recorded combined ratio
has been below 100 for six consecutive years, but underwriting income
declined by $373 million versus the prior year partially offsetting
gains in auto insurance. Net investment income increased 11.8% to $3.4
billion when combined with strong underwriting income, resulted in an
adjusted net income return on shareholders' equity* of 13.3%.
-
Grow Customer Base: Consolidated policies in force grew to 82.3
million in 2017, with positive contributions from SquareTrade and
Allstate Benefits. Allstate Protection policies in force declined due
to the impact of profit improvement actions.
-
Proactively Manage Investments: Total return on the $83 billion
investment portfolio was 5.9% for 2017, reflecting equity and fixed
income market appreciation and increased allocations to
performance-based investments over the last five years. Net investment
income of $3.4 billion was 11.8% higher than 2016, primarily due to
strong asset appreciation and sales of underlying investments in the
performance-based portfolio. The portfolio also benefited from higher
market-based income, reflecting an increase in invested assets and
stable portfolio yields.
-
Build Long-Term Growth Platforms: Allstate Benefits continued
its 17-year track record of growth, with policies in force increasing
7.4% in 2017. SquareTrade's first-year performance was very strong,
with growth in premium and policies in force accelerating each quarter
throughout 2017. Arity signed its first third-party insurance customer
to expand its platform outside of Allstate entities.
Tax Cuts and Jobs Act of 2017
-
Allstate anticipates an effective tax rate of 19%-20% in 2018.
-
Allstate will utilize the tax reform benefits to accelerate growth
initiatives, further enhance our employee value proposition, improve
local communities and raise shareholder returns by increasing the
target quarterly dividend per common share.
-
Future insurance rate filings will be impacted by lower tax rates, but
the targeted after-tax return on equity will not change. Tax reform
affects only the profit provision component of the rate filings, and
the impact will differ by state. As a result, this is not expected to
have a material impact on Allstate's near-term operating results or
competitive position.
-
The passage of the Tax Cuts and Jobs Act resulted in a revaluation of
deferred tax assets and liabilities, which primarily led to a $506
million reduction to income tax expense in the fourth quarter of 2017,
or a $1.38 per share benefit to our earnings per diluted share in 2017.
-
The tax benefit was driven by the reduction in our net deferred tax
liability principally relating to deferred acquisition costs and
unrealized investment gains.
Proactive Capital Management
"Allstate continued to proactively manage shareholders' capital by
returning $713 million during the fourth quarter through a combination
of $134 million in common stock dividends and repurchasing $579 million
of outstanding shares. For the full year we returned a total of $1.9
billion to shareholders. As of December 31, 2017, there was $1.27
billion remaining on the $2.0 billion common share repurchase program,
which would represent 3.7% of shares outstanding at the current share
price," said Mario Rizzo, Chief Financial Officer. "In addition, the
quarterly dividend per common share was increased 24% to 46 cents,
payable in cash on April 2, 2018, to stockholders of record at the close
of business on March 5, 2018."
Visit www.allstateinvestors.com
to view additional information about Allstate's results, including a
webcast of its quarterly conference call and the call presentation. The
conference call will be held at 9 a.m. ET on Thursday, February 8.
The
Allstate Corporation (NYSE: ALL) is the nation's largest publicly
held personal lines insurer, protecting people from life's uncertainties
with 82 million proprietary policies. Allstate offers a broad array of
protection products through multiple brands and diverse distribution
channels, including auto,
home,
life
and other insurance offered through its Allstate,
Esurance,
Encompass
and Answer
Financial brands. The company provides additional protection
products and services through Allstate
Benefits, Allstate
Roadside Services, Allstate
Dealer Services, Arity
and SquareTrade.
Allstate is widely known from the slogan "You're In Good Hands With
Allstate®." Allstate agencies are in virtually every local
community in America. The
Allstate Foundation, Allstate, its employees and agency owners have
a proud history of caring for local
communities.
Financial information, including material announcements about The
Allstate Corporation, is routinely posted on www.allstateinvestors.com.
Forward-Looking Statements
This news release contains "forward-looking statements" that anticipate
results based on our estimates, assumptions and plans that are subject
to uncertainty. These statements are made subject to the safe-harbor
provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements do not relate strictly to historical or
current facts and may be identified by their use of words like "plans,"
"seeks," "expects," "will," "should," "anticipates," "estimates,"
"intends," "believes," "likely," "targets" and other words with similar
meanings. We believe these statements are based on reasonable estimates,
assumptions and plans. However, if the estimates, assumptions or plans
underlying the forward-looking statements prove inaccurate or if other
risks or uncertainties arise, actual results could differ materially
from those communicated in these forward-looking statements. Factors
that could cause actual results to differ materially from those
expressed in, or implied by, the forward-looking statements may be found
in our filings with the U.S. Securities and Exchange Commission,
including the "Risk Factors" section in our most recent annual report on
Form 10-K. Forward-looking statements speak only as of the date on which
they are made, and we assume no obligation to update or revise any
forward-looking statement.
|
THE ALLSTATE CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
($ in millions, except per share data)
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
|
|
(unaudited)
|
|
|
|
|
(unaudited)
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
Property and casualty insurance premiums
|
|
|
$
|
8,202
|
|
|
$
|
7,901
|
|
|
|
$
|
32,300
|
|
|
$
|
31,307
|
|
Life premiums and contract charges
|
|
|
601
|
|
|
574
|
|
|
|
2,378
|
|
|
2,275
|
|
Net investment income
|
|
|
913
|
|
|
801
|
|
|
|
3,401
|
|
|
3,042
|
|
Realized capital gains and losses:
|
|
|
|
|
|
|
|
|
|
|
Total other-than-temporary impairment ("OTTI") losses
|
|
|
(11
|
)
|
|
(72
|
)
|
|
|
(146
|
)
|
|
(313
|
)
|
OTTI losses reclassified to (from) other comprehensive income
|
|
|
(2
|
)
|
|
2
|
|
|
|
(4
|
)
|
|
10
|
|
Net OTTI losses recognized in earnings
|
|
|
(13
|
)
|
|
(70
|
)
|
|
|
(150
|
)
|
|
(303
|
)
|
Sales and other realized capital gains and losses
|
|
|
140
|
|
|
72
|
|
|
|
595
|
|
|
213
|
|
Total realized capital gains and losses
|
|
|
127
|
|
|
2
|
|
|
|
445
|
|
|
(90
|
)
|
|
|
|
9,843
|
|
|
9,278
|
|
|
|
38,524
|
|
|
36,534
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses
|
|
|
|
|
|
|
|
|
|
|
Property and casualty insurance claims and claims expense
|
|
|
5,279
|
|
|
5,083
|
|
|
|
21,929
|
|
|
22,221
|
|
Life contract benefits
|
|
|
507
|
|
|
464
|
|
|
|
1,923
|
|
|
1,857
|
|
Interest credited to contractholder funds
|
|
|
168
|
|
|
168
|
|
|
|
690
|
|
|
726
|
|
Amortization of deferred policy acquisition costs
|
|
|
1,239
|
|
|
1,157
|
|
|
|
4,784
|
|
|
4,550
|
|
Operating costs and expenses
|
|
|
1,257
|
|
|
1,063
|
|
|
|
4,658
|
|
|
4,106
|
|
Restructuring and related charges
|
|
|
32
|
|
|
9
|
|
|
|
109
|
|
|
30
|
|
Goodwill impairment
|
|
|
125
|
|
|
-
|
|
|
|
125
|
|
|
-
|
|
Interest expense
|
|
|
84
|
|
|
77
|
|
|
|
335
|
|
|
295
|
|
|
|
|
8,691
|
|
|
8,021
|
|
|
|
34,553
|
|
|
33,785
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on disposition of operations
|
|
|
5
|
|
|
1
|
|
|
|
20
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations before income tax expense
|
|
|
1,157
|
|
|
1,258
|
|
|
|
3,991
|
|
|
2,754
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax (benefit) expense
|
|
|
(92
|
)
|
|
418
|
|
|
|
802
|
|
|
877
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
1,249
|
|
|
840
|
|
|
|
3,189
|
|
|
1,877
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock dividends
|
|
|
29
|
|
|
29
|
|
|
|
116
|
|
|
116
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to common shareholders
|
|
|
$
|
1,220
|
|
|
$
|
811
|
|
|
|
$
|
3,073
|
|
|
$
|
1,761
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to common shareholders per common share -
Basic
|
|
|
$
|
3.41
|
|
|
$
|
2.20
|
|
|
|
$
|
8.49
|
|
|
$
|
4.72
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares - Basic
|
|
|
357.5
|
|
|
368.0
|
|
|
|
362.0
|
|
|
372.8
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to common shareholders per common share -
Diluted
|
|
|
$
|
3.35
|
|
|
$
|
2.18
|
|
|
|
$
|
8.36
|
|
|
$
|
4.67
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares - Diluted
|
|
|
363.8
|
|
|
372.5
|
|
|
|
367.8
|
|
|
377.3
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per common share
|
|
|
$
|
0.37
|
|
|
$
|
0.33
|
|
|
|
$
|
1.48
|
|
|
$
|
1.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE ALLSTATE CORPORATION
|
BUSINESS RESULTS
|
($ in millions, except ratios)
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Property-Liability
|
|
|
|
|
|
|
|
|
|
|
Premiums written
|
|
|
$
|
7,838
|
|
|
$
|
7,565
|
|
|
|
$
|
31,648
|
|
|
$
|
30,891
|
|
Premiums earned
|
|
|
$
|
7,971
|
|
|
$
|
7,756
|
|
|
|
$
|
31,433
|
|
|
$
|
30,727
|
|
Claims and claims expense
|
|
|
(5,190
|
)
|
|
(5,024
|
)
|
|
|
(21,566
|
)
|
|
(21,968
|
)
|
Amortization of deferred policy acquisition costs
|
|
|
(1,091
|
)
|
|
(1,029
|
)
|
|
|
(4,205
|
)
|
|
(4,053
|
)
|
Operating costs and expenses
|
|
|
(957
|
)
|
|
(893
|
)
|
|
|
(3,559
|
)
|
|
(3,457
|
)
|
Restructuring and related charges
|
|
|
(18
|
)
|
|
(9
|
)
|
|
|
(91
|
)
|
|
(29
|
)
|
Underwriting income
|
|
|
715
|
|
|
801
|
|
|
|
2,012
|
|
|
1,220
|
|
Net investment income
|
|
|
415
|
|
|
334
|
|
|
|
1,478
|
|
|
1,253
|
|
Income tax expense on operations
|
|
|
(373
|
)
|
|
(385
|
)
|
|
|
(1,119
|
)
|
|
(812
|
)
|
Realized capital gains and losses, after-tax
|
|
|
73
|
|
|
10
|
|
|
|
272
|
|
|
-
|
|
Gain on disposition of operations, after-tax
|
|
|
2
|
|
|
-
|
|
|
|
9
|
|
|
-
|
|
Tax Legislation expense
|
|
|
(65
|
)
|
|
-
|
|
|
|
(65
|
)
|
|
-
|
|
Net income applicable to common shareholders
|
|
|
$
|
767
|
|
|
$
|
760
|
|
|
|
$
|
2,587
|
|
|
$
|
1,661
|
|
Catastrophe losses
|
|
|
$
|
598
|
|
|
$
|
302
|
|
|
|
$
|
3,228
|
|
|
$
|
2,571
|
|
Amortization of purchased intangible assets
|
|
|
$
|
2
|
|
|
$
|
5
|
|
|
|
$
|
7
|
|
|
$
|
32
|
|
Operating ratios:
|
|
|
|
|
|
|
|
|
|
|
Claims and claims expense ratio
|
|
|
65.1
|
|
|
64.8
|
|
|
|
68.6
|
|
|
71.5
|
|
Expense ratio
|
|
|
25.9
|
|
|
24.9
|
|
|
|
25.0
|
|
|
24.5
|
|
Combined ratio
|
|
|
91.0
|
|
|
89.7
|
|
|
|
93.6
|
|
|
96.0
|
|
Effect of catastrophe losses on combined ratio
|
|
|
7.5
|
|
|
3.9
|
|
|
|
10.3
|
|
|
8.4
|
|
Effect of prior year reserve reestimates on combined ratio
|
|
|
(2.3
|
)
|
|
(1.8
|
)
|
|
|
(1.6
|
)
|
|
(0.1
|
)
|
Effect of catastrophe losses included in prior year reserve
reestimates on combined ratio
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
|
-
|
|
|
-
|
|
Effect of amortization of purchased intangible assets on combined
ratio
|
|
|
-
|
|
|
0.1
|
|
|
|
-
|
|
|
0.1
|
|
Effect of Discontinued Lines and Coverages on combined ratio
|
|
|
-
|
|
|
0.1
|
|
|
|
0.3
|
|
|
0.3
|
|
|
|
|
|
|
|
|
|
|
|
|
Services Businesses
|
|
|
|
|
|
|
|
|
|
|
Premiums written
|
|
|
$
|
309
|
|
|
$
|
158
|
|
|
|
$
|
1,094
|
|
|
$
|
709
|
|
Premiums earned
|
|
|
231
|
|
|
145
|
|
|
|
867
|
|
|
580
|
|
Intersegment insurance premiums and service fees
|
|
|
28
|
|
|
32
|
|
|
|
110
|
|
|
105
|
|
Net investment income
|
|
|
5
|
|
|
4
|
|
|
|
16
|
|
|
13
|
|
Claims and claims expense
|
|
|
(90
|
)
|
|
(60
|
)
|
|
|
(369
|
)
|
|
(258
|
)
|
Amortization of deferred policy acquisition costs
|
|
|
(79
|
)
|
|
(57
|
)
|
|
|
(296
|
)
|
|
(214
|
)
|
Operating costs and expenses
|
|
|
(116
|
)
|
|
(65
|
)
|
|
|
(401
|
)
|
|
(223
|
)
|
Restructuring and related charges
|
|
|
(11
|
)
|
|
-
|
|
|
|
(13
|
)
|
|
-
|
|
Income tax benefit on operations
|
|
|
8
|
|
|
2
|
|
|
|
27
|
|
|
-
|
|
Adjusted net (loss) income
|
|
|
(24
|
)
|
|
1
|
|
|
|
(59
|
)
|
|
3
|
|
Amortization of purchased intangible assets, after-tax
|
|
|
(15
|
)
|
|
-
|
|
|
|
(60
|
)
|
|
-
|
|
Tax Legislation benefit
|
|
|
134
|
|
|
-
|
|
|
|
134
|
|
|
-
|
|
Net income applicable to common shareholders
|
|
|
$
|
95
|
|
|
$
|
1
|
|
|
|
$
|
15
|
|
|
$
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
Allstate Life
|
|
|
|
|
|
|
|
|
|
|
Premiums and contract charges
|
|
|
$
|
324
|
|
|
$
|
318
|
|
|
|
$
|
1,280
|
|
|
$
|
1,250
|
|
Net investment income
|
|
|
127
|
|
|
124
|
|
|
|
489
|
|
|
482
|
|
Contract benefits
|
|
|
(210
|
)
|
|
(188
|
)
|
|
|
(765
|
)
|
|
(742
|
)
|
Interest credited to contractholder funds
|
|
|
(71
|
)
|
|
(72
|
)
|
|
|
(282
|
)
|
|
(285
|
)
|
Amortization of deferred policy acquisition costs
|
|
|
(27
|
)
|
|
(32
|
)
|
|
|
(119
|
)
|
|
(125
|
)
|
Operating costs and expenses
|
|
|
(65
|
)
|
|
(56
|
)
|
|
|
(238
|
)
|
|
(225
|
)
|
Restructuring and related charges
|
|
|
(1
|
)
|
|
-
|
|
|
|
(2
|
)
|
|
(1
|
)
|
Income tax expense on operations
|
|
|
(20
|
)
|
|
(28
|
)
|
|
|
(110
|
)
|
|
(107
|
)
|
Adjusted net income
|
|
|
57
|
|
|
66
|
|
|
|
253
|
|
|
247
|
|
Realized capital gains and losses, after-tax
|
|
|
-
|
|
|
(7
|
)
|
|
|
2
|
|
|
(24
|
)
|
DAC and DSI amortization relating to realized capital gains and
losses, after-tax
|
|
|
(2
|
)
|
|
(1
|
)
|
|
|
(10
|
)
|
|
(4
|
)
|
Tax Legislation benefit
|
|
|
332
|
|
|
-
|
|
|
|
332
|
|
|
-
|
|
Net income applicable to common shareholders
|
|
|
$
|
387
|
|
|
$
|
58
|
|
|
|
$
|
577
|
|
|
$
|
219
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE ALLSTATE CORPORATION
|
BUSINESS RESULTS
|
($ in millions, except ratios)
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Allstate Benefits
|
|
|
|
|
|
|
|
|
|
|
Premiums and contract charges
|
|
|
$
|
273
|
|
|
$
|
252
|
|
|
|
$
|
1,084
|
|
|
$
|
1,011
|
|
Net investment income
|
|
|
18
|
|
|
17
|
|
|
|
72
|
|
|
71
|
|
Contract benefits
|
|
|
(143
|
)
|
|
(129
|
)
|
|
|
(564
|
)
|
|
(509
|
)
|
Interest credited to contractholder funds
|
|
|
(9
|
)
|
|
(8
|
)
|
|
|
(35
|
)
|
|
(36
|
)
|
Amortization of deferred policy acquisition costs
|
|
|
(37
|
)
|
|
(36
|
)
|
|
|
(142
|
)
|
|
(145
|
)
|
Operating costs and expenses
|
|
|
(70
|
)
|
|
(62
|
)
|
|
|
(266
|
)
|
|
(240
|
)
|
Restructuring and related charges
|
|
|
(2
|
)
|
|
-
|
|
|
|
(3
|
)
|
|
-
|
|
Income tax expense on operations
|
|
|
(10
|
)
|
|
(11
|
)
|
|
|
(51
|
)
|
|
(52
|
)
|
Adjusted net income
|
|
|
20
|
|
|
23
|
|
|
|
95
|
|
|
100
|
|
Realized capital gains and losses, after-tax
|
|
|
(1
|
)
|
|
(1
|
)
|
|
|
-
|
|
|
(4
|
)
|
Tax Legislation benefit
|
|
|
51
|
|
|
-
|
|
|
|
51
|
|
|
-
|
|
Net income applicable to common shareholders
|
|
|
$
|
70
|
|
|
$
|
22
|
|
|
|
$
|
146
|
|
|
$
|
96
|
|
|
|
|
|
|
|
|
|
|
|
|
Allstate Annuities
|
|
|
|
|
|
|
|
|
|
|
Contract charges
|
|
|
$
|
4
|
|
|
$
|
4
|
|
|
|
$
|
14
|
|
|
$
|
14
|
|
Net investment income
|
|
|
338
|
|
|
312
|
|
|
|
1,305
|
|
|
1,181
|
|
Contract benefits
|
|
|
(154
|
)
|
|
(147
|
)
|
|
|
(594
|
)
|
|
(606
|
)
|
Interest credited to contractholder funds
|
|
|
(90
|
)
|
|
(97
|
)
|
|
|
(372
|
)
|
|
(402
|
)
|
Amortization of deferred policy acquisition costs
|
|
|
(2
|
)
|
|
(2
|
)
|
|
|
(7
|
)
|
|
(7
|
)
|
Operating costs and expenses
|
|
|
(9
|
)
|
|
(9
|
)
|
|
|
(35
|
)
|
|
(32
|
)
|
Income tax expense on operations
|
|
|
(32
|
)
|
|
(20
|
)
|
|
|
(107
|
)
|
|
(47
|
)
|
Adjusted net income
|
|
|
55
|
|
|
41
|
|
|
|
204
|
|
|
101
|
|
Realized capital gains and losses, after-tax
|
|
|
22
|
|
|
-
|
|
|
|
28
|
|
|
(26
|
)
|
Valuation changes on embedded derivatives not hedged, after-tax
|
|
|
2
|
|
|
6
|
|
|
|
-
|
|
|
(2
|
)
|
Gain on disposition of operations, after-tax
|
|
|
1
|
|
|
-
|
|
|
|
4
|
|
|
3
|
|
Tax Legislation benefit
|
|
|
182
|
|
|
-
|
|
|
|
182
|
|
|
-
|
|
Net income applicable to common shareholders
|
|
|
$
|
262
|
|
|
$
|
47
|
|
|
|
$
|
418
|
|
|
$
|
76
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate and Other
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
$
|
10
|
|
|
$
|
10
|
|
|
|
$
|
41
|
|
|
$
|
42
|
|
Operating costs and expenses
|
|
|
(128
|
)
|
|
(86
|
)
|
|
|
(488
|
)
|
|
(324
|
)
|
Income tax benefit on operations
|
|
|
43
|
|
|
29
|
|
|
|
164
|
|
|
106
|
|
Preferred stock dividends
|
|
|
(29
|
)
|
|
(29
|
)
|
|
|
(116
|
)
|
|
(116
|
)
|
Adjusted net loss
|
|
|
(104
|
)
|
|
(76
|
)
|
|
|
(399
|
)
|
|
(292
|
)
|
Realized capital gains and losses, after-tax
|
|
|
(4
|
)
|
|
(1
|
)
|
|
|
(4
|
)
|
|
(2
|
)
|
Business combination expenses, after-tax
|
|
|
-
|
|
|
-
|
|
|
|
(14
|
)
|
|
-
|
|
Goodwill impairment
|
|
|
(125
|
)
|
|
-
|
|
|
|
(125
|
)
|
|
-
|
|
Tax Legislation expense
|
|
|
(128
|
)
|
|
-
|
|
|
|
(128
|
)
|
|
-
|
|
Net loss applicable to common shareholders
|
|
|
$
|
(361
|
)
|
|
$
|
(77
|
)
|
|
|
$
|
(670
|
)
|
|
$
|
(294
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated net income applicable to common shareholders
|
|
|
$
|
1,220
|
|
|
$
|
811
|
|
|
|
$
|
3,073
|
|
|
$
|
1,761
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE ALLSTATE CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
|
|
|
|
|
|
|
|
($ in millions, except par value data)
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
|
2016
|
Assets
|
|
|
(unaudited)
|
|
|
|
Investments:
|
|
|
|
|
|
|
Fixed income securities, at fair value (amortized cost $57,525 and
$56,576)
|
|
|
$
|
58,992
|
|
|
|
$
|
57,839
|
|
Equity securities, at fair value (cost $5,461 and $5,157)
|
|
|
6,621
|
|
|
|
5,666
|
|
Mortgage loans
|
|
|
4,534
|
|
|
|
4,486
|
|
Limited partnership interests
|
|
|
6,740
|
|
|
|
5,814
|
|
Short-term, at fair value (amortized cost $1,944 and $4,288)
|
|
|
1,944
|
|
|
|
4,288
|
|
Other
|
|
|
3,972
|
|
|
|
3,706
|
|
Total investments
|
|
|
82,803
|
|
|
|
81,799
|
|
Cash
|
|
|
617
|
|
|
|
436
|
|
Premium installment receivables, net
|
|
|
5,786
|
|
|
|
5,597
|
|
Deferred policy acquisition costs
|
|
|
4,191
|
|
|
|
3,954
|
|
Reinsurance recoverables, net
|
|
|
8,921
|
|
|
|
8,745
|
|
Accrued investment income
|
|
|
569
|
|
|
|
567
|
|
Property and equipment, net
|
|
|
1,072
|
|
|
|
1,065
|
|
Goodwill
|
|
|
2,181
|
|
|
|
1,219
|
|
Other assets
|
|
|
2,838
|
|
|
|
1,835
|
|
Separate Accounts
|
|
|
3,444
|
|
|
|
3,393
|
|
Total assets
|
|
|
$
|
112,422
|
|
|
|
$
|
108,610
|
|
Liabilities
|
|
|
|
|
|
|
Reserve for property and casualty insurance claims and claims expense
|
|
|
$
|
26,325
|
|
|
|
$
|
25,250
|
|
Reserve for life-contingent contract benefits
|
|
|
12,549
|
|
|
|
12,239
|
|
Contractholder funds
|
|
|
19,434
|
|
|
|
20,260
|
|
Unearned premiums
|
|
|
13,473
|
|
|
|
12,583
|
|
Claim payments outstanding
|
|
|
875
|
|
|
|
879
|
|
Deferred income taxes
|
|
|
782
|
|
|
|
487
|
|
Other liabilities and accrued expenses
|
|
|
6,639
|
|
|
|
6,599
|
|
Long-term debt
|
|
|
6,350
|
|
|
|
6,347
|
|
Separate Accounts
|
|
|
3,444
|
|
|
|
3,393
|
|
Total liabilities
|
|
|
89,871
|
|
|
|
88,037
|
|
Shareholders' equity
|
|
|
|
|
|
|
Preferred stock and additional capital paid-in, $1 par value, 72.2
thousand shares issued and outstanding, $1,805 aggregate liquidation
preference
|
|
|
1,746
|
|
|
|
1,746
|
|
Common stock, $.01 par value, 900 million issued, 355 million and
366 million shares outstanding
|
|
|
9
|
|
|
|
9
|
|
Additional capital paid-in
|
|
|
3,313
|
|
|
|
3,303
|
|
Retained income (1)
|
|
|
43,211
|
|
|
|
40,678
|
|
Deferred ESOP expense
|
|
|
(3
|
)
|
|
|
(6
|
)
|
Treasury stock, at cost (545 million and 534 million shares)
|
|
|
(25,982
|
)
|
|
|
(24,741
|
)
|
Accumulated other comprehensive income:
|
|
|
|
|
|
|
Unrealized net capital gains and losses:
|
|
|
|
|
|
|
Unrealized net capital gains and losses on fixed income securities
with OTTI
|
|
|
70
|
|
|
|
57
|
|
Other unrealized net capital gains and losses
|
|
|
1,634
|
|
|
|
1,091
|
|
Unrealized adjustment to DAC, DSI and insurance reserves
|
|
|
(332
|
)
|
|
|
(95
|
)
|
Unrealized net capital gains and losses (1)
|
|
|
1,372
|
|
|
|
1,053
|
|
Unrealized foreign currency translation adjustments (1)
|
|
|
(3
|
)
|
|
|
(50
|
)
|
Unrecognized pension and other postretirement benefit cost (1)
|
|
|
(1,112
|
)
|
|
|
(1,419
|
)
|
Total accumulated other comprehensive income (loss) (1)
|
|
|
257
|
|
|
|
(416
|
)
|
Total shareholders' equity
|
|
|
22,551
|
|
|
|
20,573
|
|
Total liabilities and shareholders' equity
|
|
|
$
|
112,422
|
|
|
|
$
|
108,610
|
|
(1)
|
|
In January 2018, the FASB issued a Proposed Accounting Standards
Update titled "Reclassification of Certain Tax Effects from
Accumulated Other Comprehensive Income," requiring reclassification
of the impact of the newly enacted tax rates on the unrealized
balances presented net of tax in accumulated other comprehensive
income to retained income. We plan to early adopt the new guidance
as of December 31, 2017, when finalized. The impact of the adoption
will decrease retained income by $49 million, increase unrealized
net capital gains and losses by $290 million, decrease unrealized
foreign currency translation adjustments by $6 million and decrease
unrecognized pension and other postretirement benefit cost by $235
million.
|
|
|
|
THE ALLSTATE CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
($ in millions)
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
|
2017
|
|
|
2016
|
Cash flows from operating activities
|
|
|
(unaudited)
|
|
|
|
Net income
|
|
|
$
|
3,189
|
|
|
|
$
|
1,877
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
Depreciation, amortization and other non-cash items
|
|
|
483
|
|
|
|
382
|
|
Realized capital gains and losses
|
|
|
(445
|
)
|
|
|
90
|
|
Gain on disposition of operations
|
|
|
(20
|
)
|
|
|
(5
|
)
|
Interest credited to contractholder funds
|
|
|
690
|
|
|
|
726
|
|
Goodwill Impairment
|
|
|
125
|
|
|
|
-
|
|
Changes in:
|
|
|
|
|
|
|
Policy benefits and other insurance reserves
|
|
|
302
|
|
|
|
631
|
|
Unearned premiums
|
|
|
463
|
|
|
|
362
|
|
Deferred policy acquisition costs
|
|
|
(214
|
)
|
|
|
(165
|
)
|
Premium installment receivables, net
|
|
|
(131
|
)
|
|
|
(42
|
)
|
Reinsurance recoverables, net
|
|
|
(211
|
)
|
|
|
(264
|
)
|
Income taxes
|
|
|
(245
|
)
|
|
|
417
|
|
Other operating assets and liabilities
|
|
|
328
|
|
|
|
(16
|
)
|
Net cash provided by operating activities
|
|
|
4,314
|
|
|
|
3,993
|
|
Cash flows from investing activities
|
|
|
|
|
|
|
Proceeds from sales
|
|
|
|
|
|
|
Fixed income securities
|
|
|
25,341
|
|
|
|
25,061
|
|
Equity securities
|
|
|
6,504
|
|
|
|
5,546
|
|
Limited partnership interests
|
|
|
1,125
|
|
|
|
881
|
|
Other investments
|
|
|
274
|
|
|
|
262
|
|
Investment collections
|
|
|
|
|
|
|
Fixed income securities
|
|
|
4,194
|
|
|
|
4,533
|
|
Mortgage loans
|
|
|
600
|
|
|
|
501
|
|
Other investments
|
|
|
642
|
|
|
|
421
|
|
Investment purchases
|
|
|
|
|
|
|
Fixed income securities
|
|
|
(31,145
|
)
|
|
|
(27,990
|
)
|
Equity securities
|
|
|
(6,585
|
)
|
|
|
(5,950
|
)
|
Limited partnership interests
|
|
|
(1,440
|
)
|
|
|
(1,450
|
)
|
Mortgage loans
|
|
|
(646
|
)
|
|
|
(646
|
)
|
Other investments
|
|
|
(999
|
)
|
|
|
(885
|
)
|
Change in short-term investments, net
|
|
|
2,610
|
|
|
|
(2,446
|
)
|
Change in other investments, net
|
|
|
(30
|
)
|
|
|
(51
|
)
|
Purchases of property and equipment, net
|
|
|
(299
|
)
|
|
|
(313
|
)
|
Acquisition of operations
|
|
|
(1,356
|
)
|
|
|
-
|
|
Net cash used in investing activities
|
|
|
(1,210
|
)
|
|
|
(2,526
|
)
|
Cash flows from financing activities
|
|
|
|
|
|
|
Proceeds from issuance of long-term debt
|
|
|
-
|
|
|
|
1,236
|
|
Repayments of long-term debt
|
|
|
-
|
|
|
|
(17
|
)
|
Contractholder fund deposits
|
|
|
1,025
|
|
|
|
1,049
|
|
Contractholder fund withdrawals
|
|
|
(1,890
|
)
|
|
|
(2,087
|
)
|
Dividends paid on common stock
|
|
|
(525
|
)
|
|
|
(486
|
)
|
Dividends paid on preferred stock
|
|
|
(116
|
)
|
|
|
(116
|
)
|
Treasury stock purchases
|
|
|
(1,495
|
)
|
|
|
(1,337
|
)
|
Shares reissued under equity incentive plans, net
|
|
|
135
|
|
|
|
164
|
|
Excess tax benefits on share-based payment arrangements
|
|
|
-
|
|
|
|
32
|
|
Other
|
|
|
(57
|
)
|
|
|
36
|
|
Net cash used in financing activities
|
|
|
(2,923
|
)
|
|
|
(1,526
|
)
|
Net increase (decrease) in cash
|
|
|
181
|
|
|
|
(59
|
)
|
Cash at beginning of year
|
|
|
436
|
|
|
|
495
|
|
Cash at end of year
|
|
|
$
|
617
|
|
|
|
$
|
436
|
|
|
|
|
|
|
|
|
|
|
|
|
Definitions of Non-GAAP Measures
We believe that investors' understanding of Allstate's performance is
enhanced by our disclosure of the following non-GAAP measures. Our
methods for calculating these measures may differ from those used by
other companies and therefore comparability may be limited.
Adjusted net income is net income applicable to common
shareholders, excluding:
-
realized capital gains and losses, after-tax, except for periodic
settlements and accruals on non-hedge derivative instruments, which
are reported with realized capital gains and losses but included in
adjusted net income,
-
valuation changes on embedded derivatives not hedged, after-tax,
-
amortization of deferred policy acquisition costs ("DAC") and deferred
sales inducements ("DSI"), to the extent they resulted from the
recognition of certain realized capital gains and losses or valuation
changes on embedded derivatives not hedged, after-tax,
-
business combination expenses and the amortization of purchased
intangible assets, after-tax,
-
gain (loss) on disposition of operations, after-tax, and
-
adjustments for other significant non-recurring, infrequent or unusual
items, when (a) the nature of the charge or gain is such that it is
reasonably unlikely to recur within two years, or (b) there has been
no similar charge or gain within the prior two years.
Net income applicable to common shareholders is the GAAP measure that is
most directly comparable to adjusted net income.
We use adjusted net income as an important measure to evaluate our
results of operations. We believe that the measure provides investors
with a valuable measure of the company's ongoing performance because it
reveals trends in our insurance and financial services business that may
be obscured by the net effect of realized capital gains and losses,
valuation changes on embedded derivatives not hedged, business
combination expenses and the amortization of purchased intangible
assets, gain (loss) on disposition of operations and adjustments for
other significant non-recurring, infrequent or unusual items. Realized
capital gains and losses, valuation changes on embedded derivatives not
hedged and gain (loss) on disposition of operations may vary
significantly between periods and are generally driven by business
decisions and external economic developments such as capital market
conditions, the timing of which is unrelated to the insurance
underwriting process. Consistent with our intent to protect results or
earn additional income, adjusted net income includes periodic
settlements and accruals on certain derivative instruments that are
reported in realized capital gains and losses because they do not
qualify for hedge accounting or are not designated as hedges for
accounting purposes. These instruments are used for economic hedges and
to replicate fixed income securities, and by including them in adjusted
net income, we are appropriately reflecting their trends in our
performance and in a manner consistent with the economically hedged
investments, product attributes (e.g. net investment income and interest
credited to contractholder funds) or replicated investments. Business
combination expenses are excluded because they are non-recurring in
nature and the amortization of purchased intangible assets is excluded
because it relates to the acquisition purchase price and is not
indicative of our underlying insurance business results or trends.
Non-recurring items are excluded because, by their nature, they are not
indicative of our business or economic trends. Accordingly, adjusted net
income excludes the effect of items that tend to be highly variable from
period to period and highlights the results from ongoing operations and
the underlying profitability of our business. A byproduct of excluding
these items to determine adjusted net income is the transparency and
understanding of their significance to net income variability and
profitability while recognizing these or similar items may recur in
subsequent periods. Adjusted net income is used by management along with
the other components of net income applicable to common shareholders to
assess our performance. We use adjusted measures of adjusted net income
in incentive compensation. Therefore, we believe it is useful for
investors to evaluate net income applicable to common shareholders,
adjusted net income and their components separately and in the aggregate
when reviewing and evaluating our performance. We note that investors,
financial analysts, financial and business media organizations and
rating agencies utilize adjusted net income results in their evaluation
of our and our industry's financial performance and in their investment
decisions, recommendations and communications as it represents a
reliable, representative and consistent measurement of the industry and
the company and management's performance. We note that the price to
earnings multiple commonly used by insurance investors as a
forward-looking valuation technique uses adjusted net income as the
denominator. Adjusted net income should not be considered a substitute
for net income applicable to common shareholders and does not reflect
the overall profitability of our business.
The following tables reconcile net income applicable to common
shareholders and adjusted net income. Taxes on adjustments to reconcile
net income applicable to common shareholders and adjusted net income
generally use a 35% effective tax rate and are reported net with the
reconciling adjustment, except for goodwill impairment that has no tax
benefit and Tax Legislation expense (benefit) that is all tax.
|
|
|
|
($ in millions, except per share data)
|
|
|
Three months ended December 31,
|
|
|
|
|
|
|
|
|
|
Per diluted
|
|
|
|
Property-Liability
|
|
|
Consolidated
|
|
|
common share
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Net income applicable to common shareholders
|
|
|
$
|
767
|
|
|
$
|
760
|
|
|
|
$
|
1,220
|
|
|
$
|
811
|
|
|
|
$
|
3.35
|
|
|
$
|
2.18
|
|
Realized capital gains and losses, after-tax
|
|
|
(73
|
)
|
|
(10
|
)
|
|
|
(90
|
)
|
|
(1
|
)
|
|
|
(0.25
|
)
|
|
-
|
|
Valuation changes on embedded derivatives not hedged, after-tax
|
|
|
-
|
|
|
-
|
|
|
|
(2
|
)
|
|
(6
|
)
|
|
|
(0.01
|
)
|
|
(0.02
|
)
|
DAC and DSI amortization relating to realized capital gains and
losses and valuation changes on embedded derivatives not hedged,
after-tax
|
|
|
-
|
|
|
-
|
|
|
|
2
|
|
|
1
|
|
|
|
0.01
|
|
|
-
|
|
Reclassification of periodic settlements and accruals on non-hedge
derivative instruments, after-tax
|
|
|
(1
|
)
|
|
(2
|
)
|
|
|
(1
|
)
|
|
(2
|
)
|
|
|
-
|
|
|
-
|
|
Business combination expenses and the amortization of purchased
intangible assets, after-tax
|
|
|
2
|
|
|
4
|
|
|
|
17
|
|
|
4
|
|
|
|
0.05
|
|
|
0.01
|
|
Gain on disposition of operations, after-tax
|
|
|
(2
|
)
|
|
-
|
|
|
|
(3
|
)
|
|
-
|
|
|
|
(0.01
|
)
|
|
-
|
|
Goodwill impairment
|
|
|
-
|
|
|
-
|
|
|
|
125
|
|
|
-
|
|
|
|
0.34
|
|
|
-
|
|
Tax Legislation expense (benefit)
|
|
|
65
|
|
|
-
|
|
|
|
(506
|
)
|
|
-
|
|
|
|
(1.39
|
)
|
|
-
|
|
Adjusted net income*
|
|
|
$
|
758
|
|
|
$
|
752
|
|
|
|
$
|
762
|
|
|
$
|
807
|
|
|
|
$
|
2.09
|
|
|
$
|
2.17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended December 31,
|
|
|
|
|
|
|
|
|
|
Per diluted
|
|
|
|
Property-Liability
|
|
|
Consolidated
|
|
|
common share
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Net income applicable to common shareholders
|
|
|
$
|
2,587
|
|
|
$
|
1,661
|
|
|
|
$
|
3,073
|
|
|
$
|
1,761
|
|
|
|
$
|
8.36
|
|
|
$
|
4.67
|
|
Realized capital gains and losses, after-tax
|
|
|
(272
|
)
|
|
-
|
|
|
|
(298
|
)
|
|
56
|
|
|
|
(0.81
|
)
|
|
0.15
|
|
Valuation changes on embedded derivatives not hedged, after-tax
|
|
|
-
|
|
|
-
|
|
|
|
-
|
|
|
2
|
|
|
|
-
|
|
|
-
|
|
DAC and DSI amortization relating to realized capital gains and
losses and valuation changes on embedded derivatives not hedged,
after-tax
|
|
|
-
|
|
|
-
|
|
|
|
10
|
|
|
4
|
|
|
|
0.03
|
|
|
0.01
|
|
Reclassification of periodic settlements and accruals on non-hedge
derivative instruments, after-tax
|
|
|
(3
|
)
|
|
(3
|
)
|
|
|
(3
|
)
|
|
(3
|
)
|
|
|
(0.01
|
)
|
|
(0.01
|
)
|
Business combination expenses and the amortization of purchased
intangible assets, after-tax
|
|
|
5
|
|
|
21
|
|
|
|
79
|
|
|
21
|
|
|
|
0.22
|
|
|
0.06
|
|
Gain on disposition of operations, after-tax
|
|
|
(9
|
)
|
|
-
|
|
|
|
(13
|
)
|
|
(3
|
)
|
|
|
(0.04
|
)
|
|
(0.01
|
)
|
Goodwill impairment
|
|
|
-
|
|
|
-
|
|
|
|
125
|
|
|
-
|
|
|
|
0.34
|
|
|
-
|
|
Tax Legislation expense (benefit)
|
|
|
65
|
|
|
-
|
|
|
|
(506
|
)
|
|
-
|
|
|
|
(1.38
|
)
|
|
-
|
|
Adjusted net income*
|
|
|
$
|
2,373
|
|
|
$
|
1,679
|
|
|
|
$
|
2,467
|
|
|
$
|
1,838
|
|
|
|
$
|
6.71
|
|
|
$
|
4.87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income return on common shareholders' equity is a
ratio that uses a non-GAAP measure. It is calculated by dividing the
rolling 12-month adjusted net income by the average of common
shareholders' equity at the beginning and at the end of the 12-months,
after excluding the effect of unrealized net capital gains and losses.
Return on common shareholders' equity is the most directly comparable
GAAP measure. We use adjusted net income as the numerator for the same
reasons we use adjusted net income, as discussed above. We use average
common shareholders' equity excluding the effect of unrealized net
capital gains and losses for the denominator as a representation of
common shareholders' equity primarily attributable to the company's
earned and realized business operations because it eliminates the effect
of items that are unrealized and vary significantly between periods due
to external economic developments such as capital market conditions like
changes in equity prices and interest rates, the amount and timing of
which are unrelated to the insurance underwriting process. We use it to
supplement our evaluation of net income applicable to common
shareholders and return on common shareholders' equity because it
excludes the effect of items that tend to be highly variable from period
to period. We believe that this measure is useful to investors and that
it provides a valuable tool for investors when considered along with
return on common shareholders' equity because it eliminates the
after-tax effects of realized and unrealized net capital gains and
losses that can fluctuate significantly from period to period and that
are driven by economic developments, the magnitude and timing of which
are generally not influenced by management. In addition, it eliminates
non-recurring items that are not indicative of our ongoing business or
economic trends. A byproduct of excluding the items noted above to
determine adjusted net income return on common shareholders' equity from
return on common shareholders' equity is the transparency and
understanding of their significance to return on common shareholders'
equity variability and profitability while recognizing these or similar
items may recur in subsequent periods. We use adjusted measures of
adjusted net income return on common shareholders' equity in incentive
compensation. Therefore, we believe it is useful for investors to have
adjusted net income return on common shareholders' equity and return on
common shareholders' equity when evaluating our performance. We note
that investors, financial analysts, financial and business media
organizations and rating agencies utilize adjusted net income return on
common shareholders' equity results in their evaluation of our and our
industry's financial performance and in their investment decisions,
recommendations and communications as it represents a reliable,
representative and consistent measurement of the industry and the
company and management's utilization of capital. Adjusted net income
return on common shareholders' equity should not be considered a
substitute for return on common shareholders' equity and does not
reflect the overall profitability of our business.
The following tables reconcile return on common shareholders' equity and
adjusted net income return on common shareholders' equity.
($ in millions)
|
|
|
For the twelve months ended
|
|
|
|
December 31,
|
|
|
|
2017
|
|
|
2016
|
Return on common shareholders' equity
|
|
|
|
|
|
|
Numerator:
|
|
|
|
|
|
|
Net income applicable to common shareholders
|
|
|
$
|
3,073
|
|
|
|
$
|
1,761
|
|
Denominator:
|
|
|
|
|
|
|
Beginning common shareholders' equity (1)
|
|
|
$
|
18,827
|
|
|
|
$
|
18,279
|
|
Ending common shareholders' equity (1)
|
|
|
20,805
|
|
|
|
18,827
|
|
Average common shareholders' equity
|
|
|
$
|
19,816
|
|
|
|
$
|
18,553
|
|
Return on common shareholders' equity (2)
|
|
|
15.5
|
%
|
|
|
9.5
|
%
|
|
|
|
|
|
|
|
|
|
($ in millions)
|
|
|
For the twelve months ended
|
|
|
|
December 31,
|
|
|
|
2017
|
|
|
2016
|
Adjusted net income return on common shareholders' equity
|
|
|
|
|
|
|
Numerator:
|
|
|
|
|
|
|
Adjusted net income
|
|
|
$
|
2,467
|
|
|
|
$
|
1,838
|
|
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
|
|
Beginning common shareholders' equity
|
|
|
$
|
18,827
|
|
|
|
$
|
18,279
|
|
Less: Unrealized net capital gains and losses
|
|
|
1,053
|
|
|
|
620
|
|
Adjusted beginning common shareholders' equity
|
|
|
17,774
|
|
|
|
17,659
|
|
|
|
|
|
|
|
|
Ending common shareholders' equity
|
|
|
20,805
|
|
|
|
18,827
|
|
Less: Unrealized net capital gains and losses
|
|
|
1,372
|
|
|
|
1,053
|
|
Adjusted ending common shareholders' equity
|
|
|
19,433
|
|
|
|
17,774
|
|
Average adjusted common shareholders' equity
|
|
|
$
|
18,604
|
|
|
|
$
|
17,717
|
|
Adjusted net income return on common shareholders' equity *(2)(3)
|
|
|
13.3
|
%
|
|
|
10.4
|
%
|
_____________
|
(1)
|
|
Excludes equity related to preferred stock of $1,746 million.
|
|
|
|
(2)
|
|
The Tax Legislation adjustment recorded in fourth quarter 2017
increased return on equity by 2.4 points and decreased adjusted net
income return on equity by 0.1 points.
|
|
|
|
(3)
|
|
In January 2018,the FASB issued a Proposed Accounting Standards
Update titled "Reclassification of Certain Tax Effects from
Accumulated Other Comprehensive Income," requiring reclassification
of the impact of the newly enacted tax rates on the unrealized
balances presented net of tax in accumulated other comprehensive
income to retained income. We plan to early adopt the new guidance
as of December 31, 2017, when finalized. The impact of the adoption
will increase the adjusted net income return on equity calculation
by 0.1 points.
|
|
|
|
Combined ratio excluding the effect of catastrophes, prior year
reserve reestimates and amortization of purchased intangible assets
("underlying combined ratio") is a non-GAAP ratio, which is computed
as the difference between four GAAP operating ratios: the combined
ratio, the effect of catastrophes on the combined ratio, the effect of
prior year non-catastrophe reserve reestimates on the combined ratio,
and the effect of amortization of purchased intangible assets on the
combined ratio. We believe that this ratio is useful to investors and it
is used by management to reveal the trends in our Property-Liability
business that may be obscured by catastrophe losses, prior year reserve
reestimates and amortization of purchased intangible assets. Catastrophe
losses cause our loss trends to vary significantly between periods as a
result of their incidence of occurrence and magnitude, and can have a
significant impact on the combined ratio. Prior year reserve reestimates
are caused by unexpected loss development on historical reserves.
Amortization of purchased intangible assets relates to the acquisition
purchase price and is not indicative of our underlying insurance
business results or trends. We believe it is useful for investors to
evaluate these components separately and in the aggregate when reviewing
our underwriting performance. We also provide it to facilitate a
comparison to our outlook on the underlying combined ratio. The most
directly comparable GAAP measure is the combined ratio. The underlying
combined ratio should not be considered a substitute for the combined
ratio and does not reflect the overall underwriting profitability of our
business.
The following tables reconcile the respective combined ratio to the
underlying combined ratio.
Property-Liability
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Combined ratio
|
|
|
91.0
|
|
|
89.7
|
|
|
|
93.6
|
|
|
96.0
|
|
Effect of catastrophe losses
|
|
|
(7.5
|
)
|
|
(3.9
|
)
|
|
|
(10.3
|
)
|
|
(8.4
|
)
|
Effect of prior year non-catastrophe reserve reestimates
|
|
|
2.2
|
|
|
1.7
|
|
|
|
1.6
|
|
|
0.1
|
|
Effect of amortization of purchased intangible assets
|
|
|
-
|
|
|
(0.1
|
)
|
|
|
-
|
|
|
(0.1
|
)
|
Underlying combined ratio*
|
|
|
85.7
|
|
|
87.4
|
|
|
|
84.9
|
|
|
87.6
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of prior year catastrophe reserve reestimates
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Underwriting margin is calculated as 100% minus the combined ratio.
Property-Liability as historically
reported (1)
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Combined ratio
|
|
|
92.0
|
|
|
89.9
|
|
|
|
94.4
|
|
|
96.1
|
|
Effect of catastrophe losses
|
|
|
(7.3
|
)
|
|
(3.8
|
)
|
|
|
(10.0
|
)
|
|
(8.2
|
)
|
Effect of prior year non-catastrophe reserve reestimates
|
|
|
2.1
|
|
|
1.6
|
|
|
|
1.5
|
|
|
0.1
|
|
Effect of amortization of purchased intangible assets
|
|
|
(0.3
|
)
|
|
-
|
|
|
|
(0.3
|
)
|
|
(0.1
|
)
|
Underlying combined ratio*
|
|
|
86.5
|
|
|
87.7
|
|
|
|
85.6
|
|
|
87.9
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of prior year catastrophe reserve reestimates
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
|
(0.1
|
)
|
|
-
|
|
(1)
|
|
Property-Liability, as historically reported, includes Allstate
Protection, Services Businesses and Discontinued Lines and Coverages
segment results.
|
Allstate brand - Total
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Combined ratio
|
|
|
89.9
|
|
|
88.7
|
|
|
|
92.3
|
|
|
94.8
|
|
Effect of catastrophe losses
|
|
|
(7.4
|
)
|
|
(4.1
|
)
|
|
|
(10.4
|
)
|
|
(8.7
|
)
|
Effect of prior year non-catastrophe reserve reestimates
|
|
|
2.3
|
|
|
1.6
|
|
|
|
2.0
|
|
|
0.4
|
|
Underlying combined ratio*
|
|
|
84.8
|
|
|
86.2
|
|
|
|
83.9
|
|
|
86.5
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of prior year catastrophe reserve reestimates
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
|
-
|
|
|
-
|
|
Allstate brand - Auto Insurance
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Combined ratio
|
|
|
91.9
|
|
|
95.3
|
|
|
|
93.2
|
|
|
98.7
|
|
Effect of catastrophe losses
|
|
|
(0.7
|
)
|
|
(1.2
|
)
|
|
|
(3.4
|
)
|
|
(2.8
|
)
|
Effect of prior year non-catastrophe reserve reestimates
|
|
|
3.0
|
|
|
2.1
|
|
|
|
2.4
|
|
|
0.6
|
|
Underlying combined ratio*
|
|
|
94.2
|
|
|
96.2
|
|
|
|
92.2
|
|
|
96.5
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of prior year catastrophe reserve reestimates
|
|
|
-
|
|
|
-
|
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
Allstate brand - Homeowners Insurance
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Combined ratio
|
|
|
85.4
|
|
|
68.7
|
|
|
|
89.4
|
|
|
83.7
|
|
Effect of catastrophe losses
|
|
|
(27.8
|
)
|
|
(10.8
|
)
|
|
|
(30.7
|
)
|
|
(24.6
|
)
|
Effect of prior year non-catastrophe reserve reestimates
|
|
|
2.3
|
|
|
1.2
|
|
|
|
1.8
|
|
|
0.4
|
|
Underlying combined ratio*
|
|
|
59.9
|
|
|
59.1
|
|
|
|
60.5
|
|
|
59.5
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of prior year catastrophe reserve reestimates
|
|
|
(0.3
|
)
|
|
(0.5
|
)
|
|
|
(0.1
|
)
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allstate brand - Other Personal Lines
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Combined ratio
|
|
|
84.5
|
|
|
87.1
|
|
|
|
93.1
|
|
|
89.6
|
|
Effect of catastrophe losses
|
|
|
(4.8
|
)
|
|
(9.7
|
)
|
|
|
(12.2
|
)
|
|
(11.8
|
)
|
Effect of prior year non-catastrophe reserve reestimates
|
|
|
(1.9
|
)
|
|
(0.7
|
)
|
|
|
(0.5
|
)
|
|
0.7
|
|
Underlying combined ratio*
|
|
|
77.8
|
|
|
76.7
|
|
|
|
80.4
|
|
|
78.5
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of prior year catastrophe reserve reestimates
|
|
|
(0.5
|
)
|
|
(0.2
|
)
|
|
|
0.2
|
|
|
(0.2
|
)
|
Esurance brand - Total
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Combined ratio
|
|
|
100.2
|
|
|
105.0
|
|
|
|
103.3
|
|
|
107.5
|
|
Effect of catastrophe losses
|
|
|
(0.2
|
)
|
|
(1.2
|
)
|
|
|
(2.9
|
)
|
|
(2.2
|
)
|
Effect of prior year non-catastrophe reserve reestimates
|
|
|
-
|
|
|
2.1
|
|
|
|
-
|
|
|
1.3
|
|
Effect of amortization of purchased intangible assets
|
|
|
(0.2
|
)
|
|
(0.9
|
)
|
|
|
(0.2
|
)
|
|
(1.4
|
)
|
Underlying combined ratio*
|
|
|
99.8
|
|
|
105.0
|
|
|
|
100.2
|
|
|
105.2
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of prior year catastrophe reserve reestimates
|
|
|
-
|
|
|
-
|
|
|
|
(0.1
|
)
|
|
-
|
|
Encompass brand - Total
|
|
|
Three months ended
|
|
|
Twelve months ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Combined ratio
|
|
|
106.4
|
|
|
90.0
|
|
|
|
103.0
|
|
|
99.9
|
|
Effect of catastrophe losses
|
|
|
(23.4
|
)
|
|
(3.1
|
)
|
|
|
(17.7
|
)
|
|
(9.2
|
)
|
Effect of prior year non-catastrophe reserve reestimates
|
|
|
3.4
|
|
|
3.8
|
|
|
|
1.2
|
|
|
(0.4
|
)
|
Underlying combined ratio*
|
|
|
86.4
|
|
|
90.7
|
|
|
|
86.5
|
|
|
90.3
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of prior year catastrophe reserve reestimates
|
|
|
(0.4
|
)
|
|
-
|
|
|
|
(0.1
|
)
|
|
-
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20180207006363/en/
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