01—Abstract
Summary
Summary of the 10-K filed February 18, 2022. Cited figures are marked; the original filing is the authoritative source.
The Allstate Corporation's 2021 10-K filing reveals a year marked by significant strategic initiatives, including the acquisition of National General Holdings Corp. and the divestiture of its life and annuity businesses.
These actions have reshaped the company's portfolio, with a strong focus on growing its core property-liability business and expanding protection offerings. Allstate Protection remains the dominant segment, contributing the vast majority of revenue, while experiencing increased catastrophe and non-catastrophe losses, particularly in auto insurance, which Allstate is addressing with rate increases and cost management. Financially, total revenues saw a substantial increase, driven by premium growth and strong net investment income.
However, net income applicable to common shareholders declined significantly due to the loss on discontinued operations from the life and annuity divestitures. The company also continues its share repurchase program, demonstrating a commitment to returning capital to shareholders. Allstate's strategic repositioning aims to enhance market share in personal property-liability and leverage its brands and capabilities for continued growth in protection services.
02—Key points
Key Highlights
- Acquisition of National General significantly expanded Allstate's independent agent channel presence and market share in personal property-liability insurance.
- Divestiture of life and annuity businesses (ALIC, ALNY) resulted in a significant loss on disposition but streamlined the company's focus on core insurance operations.
- Total revenues increased by 20.7% to $50.59 billion, driven by property and casualty insurance premiums and higher net investment income.
- Net income applicable to common shareholders decreased by 72.8% to $1.49 billion, primarily due to a substantial loss from discontinued operations.
- The Allstate Protection segment's underwriting income decreased by 60.9% due to higher auto and homeowners losses (both catastrophe and non-catastrophe) and increased underwriting expenses.
- Net investment income more than doubled to $3.29 billion, largely driven by strong performance-based results from limited partnerships.
- The company repurchased approximately $3.26 billion of its common stock in 2021 and announced a new $5 billion repurchase program.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2021filed February 18, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $50.60B$41.91B | +20.7% |
| Operating Income | $5.21B$5.43B | −4.1% |
| Interest Expense | $330.00M$318.00M | +3.8% |
| Net Income | $1.49B$5.58B | −73.4% |
| EPS (Basic) | $5.09$17.53 | −71.0% |
| EPS (Diluted) | $5.01$17.31 | −71.1% |
| Shares Outstanding (Basic) | 294.80M311.60M | −5.4% |
| Shares Outstanding (Diluted) | 299.10M315.50M | −5.2% |
05—Questions
Frequently Asked Questions
What were the main strategic moves by Allstate in 2021?
Allstate's primary strategic moves in 2021 included the acquisition of National General Holdings Corp. to bolster its independent agent channel and personal property-liability market share, and the divestiture of its life and annuity businesses (ALIC, ALNY) which resulted in a significant loss but sharpened the company's focus on core insurance operations.
How did Allstate's financial performance fare in 2021?
Total revenues saw a significant increase of 20.7% to $50.59 billion, driven by higher premiums and robust net investment income. However, net income applicable to common shareholders decreased substantially by 72.8% to $1.49 billion, largely due to a $4.09 billion loss on the disposition of its life and annuity businesses.
What impacted the Allstate Protection segment's profitability?
The Allstate Protection segment experienced a 60.9% decrease in underwriting income, primarily attributed to higher catastrophe and non-catastrophe losses in auto and homeowners insurance, coupled with increased underwriting expenses. These factors were partially offset by higher earned premiums and reduced Shelter-in-Place Payback expenses.
How is Allstate managing its investment portfolio?
Allstate's investment portfolio, totaling $64.70 billion, saw net investment income increase by 107.1% to $3.29 billion, significantly boosted by strong performance-based results, particularly from limited partnerships. The company is strategically managing its fixed income portfolio by shortening duration to mitigate interest rate risk.
06—Continue