Skip to content
AnalystLens

ALLSTATE CORP 8-K Report, Financial Results (Oct 30, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed October 30, 2024
Period End
October 30, 2024
In the record · 2016–202610-K1110-Q328-K240

ALL filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 240 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Nov ’16Nov ’16
  2. Deal closed8-K · Jan ’21Jan ’21
  3. Leadership change8-K · Aug ’22Aug ’22
  4. Leadership change8-K · Jul ’26Jul ’26

01—Abstract

Summary

Summary of the 8-K filed October 30, 2024. Cited figures are marked; the original filing is the authoritative source.

Allstate reported third quarter 2024 results on October 30, 2024 that showed a sharp swing back to profitability.

Net income applicable to common shareholders was $1.16 billiona, or $4.33 per diluted share, versus a net loss of $41 million a year earlier. Adjusted net income, the non-GAAP measure management emphasizes and uses in incentive compensation, was $1.05 billion, or $3.91 per diluted share, compared with $214 million ($0.81) in the prior-year quarter. Total revenues rose 14.7% to $16.6 billion, driven by a 11.6% increase in Property-Liability earned premiums.

The Property-Liability recorded combined ratio improved 7.0 points to 96.4, and the underlying combined ratio improved 8.7 points to 83.2, even though catastrophe losses rose 44.2% to $1.7 billionb. Trailing twelve-month adjusted return on equity was 26.1%, up from negative 9.7% a year earlier. The quality of the improvement is mixed.

Auto insurance underwriting income of $486 millionc reflects the profit-restoration plan, supported by rate increases and a favorable reserve-related severity revision in the quarter. However, Allstate Protection auto policies in force fell 1.5% to about 25.0 million as retention losses from prior price increases offset a 26% rise in new business sales. Homeowners results were profitable despite $1.2 billion of catastrophe losses, and homeowners policies in force grew 2.5%.

Management also noted that Hurricane Milton would cause roughly $100 milliond of losses in the fourth quarter. Investment income rose 24.9% in the market-based portfolio, and total return on the $73.6 billion investment portfolio was 3.7% for the quarter and 9.4% for the trailing twelve months. The company also announced an agreement to sell its Employer Voluntary Benefits business to StanCorp Financial for $2 billion, which is expected to close in the first half of 2025 subject to regulatory approval.

That business is now classified as held for sale, with $3.2 billion of assets and $2.2 billion of liabilities shown separately on the balance sheet. Book value per common share rose 47.2% year over year to $70.35, and statutory surplus reached $17.3 billion. Investors should weigh the strong near-term profitability and capital position against the auto policy attrition, exposure to elevated catastrophe losses, and the pending divestiture.

02—Key points

Key Highlights

  1. Net income applicable to common shareholders was $1.16 billion ($4.33 per diluted share) in Q3 2024, versus a $41 million loss in Q3 2023.
  2. Adjusted net income was $1.05 billion ($3.91 per diluted share), up from $214 million ($0.81) a year earlier; trailing twelve-month adjusted ROE reached 26.1%.
  3. Property-Liability recorded combined ratio improved 7.0 points to 96.4 (underlying 83.2, down 8.7 points) despite catastrophe losses rising 44.2% to $1.7 billion.
  4. Allstate Protection auto generated $486 million underwriting income, but auto policies in force fell 1.5% to 25.0 million due to retention losses.
  5. Agreement to sell Employer Voluntary Benefits to StanCorp Financial for $2 billion, expected to close in the first half of 2025 subject to regulatory approval.
  6. Book value per common share rose 47.2% year over year to $70.35; statutory surplus increased to $17.3 billion.
  7. Protection Services revenue grew 17.9% to $822 million, led by Allstate Protection Plans (+23.1%) and Arity (revenue up 155%).

03—Questions

Frequently Asked Questions

  1. Why did Allstate swing from a loss to a profit in the third quarter?

    Property-Liability underwriting income improved by $909 million to $495 million, driven by a 11.6% increase in earned premiums from rate increases and higher average premiums, along with improved underlying loss experience. These gains more than offset a 44.2% increase in catastrophe losses and higher advertising expense. The prior-year quarter had also been hit by elevated losses and a larger net investment loss.

  2. Is the auto insurance turnaround sustainable?

    Management attributes the improvement to a comprehensive margin-restoration plan. Auto underwriting income of $486 million and a 94.8 recorded combined ratio are encouraging, but the quarter benefited from a favorable severity estimate revision; excluding it, the combined ratio would have been 95.6. Policies in force also fell 1.5%, so sustaining growth will depend on improving retention.

  3. What is the impact of the Employer Voluntary Benefits sale?

    Allstate agreed to sell the Employer Voluntary Benefits business to StanCorp Financial for $2 billion, with completion expected in the first half of 2025 pending regulatory approval. The business is shown as held for sale and its operations remain in reported results until closing. Its Q3 2024 adjusted net income was $19 million, so the divestiture is not expected to materially affect the segment's earnings contribution, though it reduces the scale of the Health and Benefits segment.

  4. How exposed is Allstate to catastrophe losses going forward?

    Catastrophe losses were $1.7 billion in the quarter, with $1.2 billion in homeowners from four hurricanes and dozens of severe weather events. Hurricane Milton was estimated to cause about $100 million of losses in the fourth quarter. Homeowners results remain sensitive to catastrophe activity, which is a key variable for future earnings volatility.

04—Continue

← View all 8-K filings