ALLSTATE CORP Annual Report, Year Ended Dec 31, 2010

The Allstate Corporation's 2010 Form 10-K filing reveals a company navigating a challenging but stabilizing financial landscape. In 2010, Allstate reported a net income of $928 million, a slight increase from $854 million in 2009, signaling a recovery after a significant net loss in 2008. The Allstate Protection segment, primarily auto and homeowners insurance, remains the core of the business, accounting for 92% of consolidated insurance premiums. While this segment experienced a decline in net income due to increased claims and a less favorable combined ratio (98.1% in 2010 vs. 96.2% in 2009), it showed resilience with growth in Allstate brand auto and homeowners premiums. The Allstate Financial segment turned profitable in 2010 with a net income of $58 million, a significant improvement from a net loss of $483 million in 2009, driven by lower amortization of deferred policy acquisition costs and reduced interest credited to contractholder funds. Key strategic priorities for 2011 include improving operating results, growing profitable businesses, and differentiating through innovation. The company is actively managing its catastrophe exposure through reinsurance and refining its underwriting and pricing strategies, particularly in property lines. A significant development is the agreement to sell substantially all of Allstate Bank's deposits to Discover Bank, expected to close mid-year 2011, which will allow Allstate Financial to focus on its core insurance and retirement products. Investors should note the company's ongoing efforts to manage investment risks, particularly in its fixed income and equity portfolios, and its continued commitment to returning capital to shareholders through dividends and share repurchases, with a new $1 billion repurchase program announced.