Allstate Corporation (the) · NYSE:ALL
Allstate Corporation (the) — Q4 2018 Earnings Presentation
62 slides from Allstate Corporation (the)'s earnings presentation, Feb 5, 2019
Slide 1: Investor Supplement Fourth Quarter 2018
The Allstate Corporation Investor Supplement Fourth Quarter 2018 The consolidated financial statements and financial exhibits included herein are unaudited. These consolidated financial statements and exhibits should be read in conjunction with the consolidated financial statements and notes thereto
Slide 2: Table of Contents
The Allstate Corporation Investor Supplement - Fourth Quarter 2018 Table of Contents Consolidated Operations Allstate Life Statements of Operations 1 Segment Results and Other Statistics 36 Contribution to Income 2 Analysis of Net Income 37 Revenues 3 Return on Equity 38 Segment Results 4,5 Reserves
Slide 3: Consolidated Statements of Operations
The Allstate Corporation Consolidated Statements of Operations ($ in millions, except per share data) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Revenues Proper
Slide 4: Contribution to Income
The Allstate Corporation Contribution to Income ($ in millions, except per share data) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Contribution to income Net (lo
Slide 5: Revenues
The Allstate Corporation Revenues ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Property-Liability (1) Insurance premiums $ 8,422 $ 8,320 $ 8,189 $
Slide 6: Consolidating Segment Results (Three months)
The Allstate Corporation Consolidating Segment Results Allstate Discontinued Property- Service Allstate Allstate Allstate Corporate Intersegment ($ in millions) Protection Lines Liability Businesses Life Benefits Annuities and Other Eliminations Consolidated Three months ended December 31, 2018 Prem
Slide 7: Consolidating Segment Results (Twelve months)
The Allstate Corporation Consolidating Segment Results Allstate Discontinued Property- Service Allstate Allstate Allstate Corporate Intersegment ($ in millions) Protection Lines Liability Businesses Life Benefits Annuities and Other Eliminations Consolidated Twelve months ended December 31, 2018 Pre
Slide 8: Condensed Consolidated Statements of Financial Position
The Allstate Corporation Condensed Consolidated Statements of Financial Position ($ in millions) Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec 31, Sept. 30, June 30, March 31, Dec 31, 2018 2018 2018 2018 2017 2018 2018 2018 2018 2017 Assets Liabilities Investments Reserve for property and casua
Slide 9: Book Value per Common Share
The Allstate Corporation Book Value per Common Share ($ in millions, except per share data) Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2018 2018 2018 2018 2017 2017 2017 2017 Book value per common share Numerator: (1) Common shareholders' equity $ 19,382 $ 21,330 $ 2
Slide 10: Return on Common Shareholders' Equity
The Allstate Corporation Return on Common Shareholders' Equity ($ in millions) Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2018 2018 2018 2018 2017 2017 2017 2017 Return on Common Shareholders' Equity Numerator: (1) Net income applicable to common
Slide 11: Debt to Capital
The Allstate Corporation Debt to Capital ($ in millions) Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2018 2018 2018 2018 2017 2017 2017 2017 Debt Short-term debt $ - $ - $ - $ - $ - $ - $ - $ - Long-term debt 6,451 6,450 6,448 6,847 6,350 6,349 6,348 6,346 Total debt
Slide 12: Consolidated Statements of Cash Flows
The Allstate Corporation Consolidated Statements of Cash Flows ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Cash flows from operating activities N
Slide 13: Analysis of Deferred Policy Acquisition Costs (Three months)
The Allstate Corporation Analysis of Deferred Policy Acquisition Costs ($ in millions) Change in Deferred Policy Acquisition Costs For the three months ended December 31, 2018 Amortization relating to realized capital gains and Amortization losses and (acceleration) Effect of Beginning Acquisition A
Slide 14: Analysis of Deferred Policy Acquisition Costs (Twelve months)
The Allstate Corporation Analysis of Deferred Policy Acquisition Costs ($ in millions) Change in Deferred Policy Acquisition Costs Reconciliation of Deferred Policy For the twelve months ended December 31, 2018 Acquisition Costs as of December 31, 2018 Amortization relating to realized capital gains
Slide 15: Policies in Force and Other Statistics
The Allstate Corporation Policies in Force and Other Statistics Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Policies In Force statistics (in thousands) (1) 2018 2018 2018 2018 2017 2017 2017 2017 Allstate Protection Allstate brand Auto 20,104 19,912 19,810 19,617 19,5
Slide 16: Premiums Written for Allstate Protection and Service Businesses
The Allstate Corporation Premiums Written for Allstate Protection and Service Businesses ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Allstate Pro
Slide 17: Catastrophe Losses
The Allstate Corporation Catastrophe Losses ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Allstate Protection Allstate brand Auto $ 53 $ 113 $ 160
Slide 18: Prior Year Reserve Reestimates
The Allstate Corporation Prior Year Reserve Reestimates ($ in millions) Twelve months ended December 31, 2018 2017 2016 Prior Year Reserve Reestimates (1) Allstate brand $ (332) $ (585) $ (110) Esurance brand 3 (2) (21) Encompass brand (11) (14) 5 Allstate Protection (340) (601) (126) Discontinued L
Slide 19: Historical Loss Reserves
The Allstate Corporation Historical Loss Reserves ($ in millions) As of and for the twelve months ended December 31, 2018 2017 2016 2015 2014 (net of reinsurance) Net reserve for claims and claims expense, beginning of year $ 19,854 $ 19,066 $ 17,977 $ 17,229 $ 17,193 Acquisitions - 17 - - - Claims
Slide 20: Property-Liability Results
The Allstate Corporation Property-Liability Results ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Premiums written $ 8,370 $ 8,800 $ 8,541 $ 7,844
Slide 21: Property-Liability Underwriting Results by Area of Business
The Allstate Corporation Property-Liability Underwriting Results by Area of Business ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Property-Liabili
Slide 22: Property-Liability Catastrophe Experience
The Allstate Corporation Property-Liability Catastrophe Experience Catastrophe by Size of Event ($ in millions) Three months ended December 31, 2018 Average Number Claims and Combined catastrophe Size of catastrophe of events claims expense ratio impact loss per event Greater than $250 million 1 3.7
Slide 23: Property-Liability Prior Year Reserve Reestimates
The Allstate Corporation Property-Liability Prior Year Reserve Reestimates ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Prior Year Reserve Reestim
Slide 24: Catastrophe Losses included in Prior Year Reserve Reestimates
The Allstate Corporation Property-Liability Catastrophe Losses included in Prior Year Reserve Reestimates ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018
Slide 25: Allstate Protection Impact of Net Rate Changes Approved on Premiums Written
The Allstate Corporation Allstate Protection Impact of Net Rate Changes Approved on Premiums Written Three months ended Three months ended Three months ended December 31, 2018 (1) September 30, 2018 June 30, 2018 Number of Location Number of Location Number of Location locations (7) Total brand (%)
Slide 26: Allstate Brand Profitability Measures
The Allstate Corporation Allstate Brand Profitability Measures ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Net premiums written $ 7,646 $ 8,010 $
Slide 27: Allstate Brand Statistics
The Allstate Corporation Allstate Brand Statistics (1) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 New Issued Applications (in thousands) (2) Auto 710 755 754 71
Slide 28: Esurance Brand Profitability Measures and Statistics
The Allstate Corporation Esurance Brand Profitability Measures and Statistics ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Net premiums written $
Slide 29: Encompass Brand Profitability Measures and Statistics
The Allstate Corporation Encompass Brand Profitability Measures and Statistics ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Net premiums written $
Slide 30: Auto Profitability Measures by Brand
The Allstate Corporation Auto Profitability Measures by Brand ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Allstate brand auto Net premiums writte
Slide 31: Homeowners Profitability Measures by Brand
The Allstate Corporation Homeowners Profitability Measures by Brand ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Allstate brand homeowners Net pre
Slide 32: Other Personal Lines Profitability Measures by Brand
The Allstate Corporation Other Personal Lines Profitability Measures by Brand (1) ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Allstate brand othe
Slide 33: Commercial Lines Profitability Measures
The Allstate Corporation Commercial Lines Profitability Measures (1) ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 (3) 2017 Net premiums written $ 177 $
Slide 34: Discontinued Lines and Coverages Reserves
The Allstate Corporation Discontinued Lines and Coverages Reserves ($ in millions) Three months ended Twelve months ended December 31, Dec. 31, Sept. 30, June 30, March 31, (net of reinsurance) 2018 2018 2018 2018 2018 2017 2016 2015 2014 Asbestos Beginning reserves $ 882 $ 856 $ 866 $ 884 $ 884 $ 9
Slide 35: Service Businesses Segment Results
The Allstate Corporation Service Businesses Segment Results (1) ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Service Businesses Net premiums writt
Slide 36: SquareTrade Results
The Allstate Corporation SquareTrade Results ($ in millions) As of or for the three months ended As of or for the twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Net premiums written $
Slide 37: Other Service Businesses Segment Results
The Allstate Corporation Other Service Businesses Segment Results ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Arity (1) Intersegment service fees
Slide 38: Allstate Life Segment Results and Other Statistics
The Allstate Corporation Allstate Life Segment Results and Other Statistics ($ in millions) As of or for the three months ended As or for the twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018
Slide 39: Allstate Life Analysis of Net Income
The Allstate Corporation Allstate Life Analysis of Net Income ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Benefit spread Premiums $ 158 $ 149 $ 1
Slide 40: Allstate Life Return on Equity
The Allstate Corporation Allstate Life Return on Equity ($ in millions) Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, 2018 2018 2018 2018 2017 Return on Equity Numerator: Net income applicable to common shareholders (1)(2) $ 254 $ 579 $ 598 $ 585 $ 577 Denominator: Beginning equ
Slide 41: Allstate Life Reserves and Contractholder Funds
The Allstate Corporation Allstate Life Reserves and Contractholder Funds ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Reserve for life-contingent
Slide 42: Allstate Benefits Segment Results and Other Statistics
The Allstate Corporation Allstate Benefits Segment Results and Other Statistics ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Premiums $ 253 $ 259
Slide 43: Allstate Benefits Segment Premium and Other Statistics
The Allstate Corporation Allstate Benefits Segment Premium and Other Statistics ($ in millions) As of or for the three months ended As of or for the twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 20
Slide 44: Allstate Benefits Return on Equity
The Allstate Corporation Allstate Benefits Return on Equity ($ in millions) Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, 2018 2018 2018 2018 2017 Return on Equity Numerator: Net income applicable to common shareholders (1)(2) $ 113 $ 164 $ 159 $ 150 $ 146 Denominator: Beginning
Slide 45: Allstate Annuities Segment Results and Other Statistics
The Allstate Corporation Allstate Annuities Segment Results and Other Statistics ($ in millions) As of or for the three months ended As of or for the twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2
Slide 46: Allstate Annuities Analysis of Net Income
The Allstate Corporation Allstate Annuities Analysis of Net Income ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Benefit spread Cost of insurance c
Slide 47: Allstate Annuities Return on Equity
The Allstate Corporation Allstate Annuities Return on Equity ($ in millions) Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, 2018 2018 2018 2018 2017 Return on Equity Numerator: (1)(2) Net income applicable to common shareholders $ 75 $ 460 $ 395 $ 406 $ 418 Denominator: Beginning
Slide 48: Allstate Annuities Reserves and Contractholder Funds
The Allstate Corporation Allstate Annuities Reserves and Contractholder Funds ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Reserve for life-contin
Slide 49: Corporate and Other Segment Results
The Allstate Corporation Corporate and Other Segment Results ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Net investment income $ 15 $ 20 $ 23 $ 1
Slide 50: Consolidated Investments
The Allstate Corporation Consolidated Investments ($ in millions) Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2018 2018 2018 2018 2017 2017 2017 2017 Consolidated Investments Fixed income securities, at fair value: Tax-exempt $ 7,000 $ 7,252 $ 7,396 $ 6,310 $ 6,010 $
Slide 51: Investments by Segment
The Allstate Corporation Investments by Segment ($ in millions) As of December 31, 2018 Property- Service Allstate Allstate Allstate Corporate Liability Businesses Life Benefits Annuities and Other Total Investments by Segment Fixed income securities, at fair value: Tax-exempt $ 6,693 $ - $ - $ - $
Slide 52: Unrealized Net Capital Gains and Losses by Type
The Allstate Corporation Unrealized Net Capital Gains and Losses by Type ($ in millions) December 31, 2018 September 30, 2018 June 30, 2018 Unrealized net Fair value Unrealized net Fair value Unrealized net Fair value capital gains Fair as a percent of capital gains Fair as a percent of capital gain
Slide 53: Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-Tax)
The Allstate Corporation Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-Tax) ($ in millions) Three months ended Twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 201
Slide 54: Net Investment Income, Yields and Realized Gains and Losses by Segment (Three months)
The Allstate Corporation Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-Tax) by Segment ($ in millions) Three months ended December 31, 2018 Property- Service Allstate Allstate Allstate Corporate Liability Businesses Life Benefits Annuities and Other Total Net Investment In
Slide 55: Net Investment Income, Yields and Realized Gains and Losses by Segment (Twelve months)
The Allstate Corporation Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-Tax) by Segment ($ in millions) Twelve months ended December 31, 2018 Property- Service Allstate Allstate Allstate Corporate Liability Businesses Life Benefits Annuities and Other Total Net Investment I
Slide 56: Investment Position and Results by Strategy
The Allstate Corporation Investment Position and Results by Strategy ($ in millions) As of or for the three months ended As of or for the twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 201
Slide 57: Investment Position and Results by Strategy and Segment (Three months)
The Allstate Corporation Investment Position and Results by Strategy and Segment ($ in millions) As of or for the three months ended December 31, 2018 Property- Service Allstate Allstate Allstate Corporate Liability Businesses Life Benefits Annuities and Other Total Market-based (1) Investment Posit
Slide 58: Investment Position and Results by Strategy and Segment (Twelve months)
The Allstate Corporation Investment Position and Results by Strategy and Segment ($ in millions) As of or for the twelve months ended December 31, 2018 Property- Service Allstate Allstate Allstate Corporate Liability Businesses Life Benefits Annuities and Other Total Market-based (1) Investment Posi
Slide 59: Performance-Based Investments
The Allstate Corporation Performance-Based Investments ($ in millions) As of or for the three months ended As of or for the twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Investment p
Slide 60: Limited Partnership Interests
The Allstate Corporation Limited Partnership Interests ($ in millions) As of or for the three months ended As of or for the twelve months ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2018 2018 2018 2018 2017 2017 2017 2017 2018 2017 Investment p
Slide 61: Definitions of Non-GAAP Measures
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. A
Slide 62: Definitions of Non-GAAP Measures (continued)
Definitions of Non-GAAP Measures (continued) Underlying loss ratio is a non-GAAP ratio, which is computed as the difference between three GAAP operating ratios: the loss ratio, the effect of catastrophes on the combined ratio and the effect of prior year non-catastrophe reserve reestimates on the co