Allstate Third-Quarter Profit Falls To $2.1 Billion As Storm Losses Nearly Triple
Catastrophe losses hit $1.65 billion and adjusted earnings fell to $9.76 a share, while policies in force grew to 217.6 million.
Allstate, the insurer that sells auto and homeowners coverage, said third-quarter net income fell to $2.1 billion from $3.7 billion a year earlier, or $8.03 per diluted share, as storm losses jumped. Policies in force still grew, and the company called the results "excellent," in a release filed with an 8-K on Wednesday.
Storms hit homeowners hardest
Catastrophe losses in the Property-Liability business reached $1.65 billion, up from $558 million a year earlier. Underwriting income fell to $2.0 billion from $2.9 billion.
Homeowners took the brunt: catastrophe losses were $1.33 billion against $479 million, and the combined ratio, which measures claims and costs per dollar of premium, worsened to 89.5 from 71.5. Excluding catastrophes, the homeowners ratio was 60.1, against 59.8 a year earlier.
The company also pointed to last year's gain on the sale of its group health business and this year's investment losses as reasons net income fell.
Adjusted earnings of $9.76 a share
Adjusted net income, which strips out investment gains and losses and certain other items, was $2.5 billion, or $9.76 per diluted share, against $3.0 billion, or $11.17, a year earlier.
Net investment income rose to $1.2 billion, up $228 million. Net losses on investments and derivatives were $545 million, compared with a $252 million gain a year earlier; the company tied them mainly to higher interest rates.
Revenue was $17.3 billion, up 0.5%.
217.6 million policies and new deals
Total policies in force reached 217.6 million, 3.9% above a year earlier, with Protection Services products making up most of the count. Property-Liability policies rose 3.3%; auto policies rose 3.4% and homeowners 3.3%.
Protection Services revenue climbed 6.9% to $964 million. In October, Arity bought INRIX, a transportation intelligence and mobility analytics provider. In November, Arity agreed to buy the rest of Replica, a mobility data company, a deal expected to close before the end of 2026.
CFO Chris Lown said about $1.5 billion went back to shareholders in the quarter through buybacks and dividends, leaving $1.3 billion of a $4.0 billion repurchase authorization.
Allstate holds its earnings call at 9 a.m. ET on Thursday, Nov. 5.
Sources
- 8-K Filing — ALLSTATE CORP (ALL) — SEC EDGAR
- Exhibit allcorp93026earningsreleas.htm — ALLSTATE CORP 8-K exhibit — SEC EDGAR
- Exhibit allcorp93026investorsupp.htm — ALLSTATE CORP 8-K exhibit — SEC EDGAR
- Will Property-Liability Underwriting Woes Hurt Allstate's Q3 Results? — Yahoo Finance
- Allstate Corporation (The) (ALL) Stock Forecasts — Yahoo Finance
