Allstate Corporation (the) · NYSE:ALL
Allstate Corporation (the) — Q4 2022 Earnings Presentation
20 slides from Allstate Corporation (the)'s earnings presentation, Feb 2, 2023
Slide 1: The Allstate Corporation Fourth Quarter 2022 Earnings Presentation
The Allstate Corporation Fourth Quarter 2022 Earnings Presentation 02.02.2023
Slide 2: Forward-looking Statements and Non-GAAP Financial Information
Forward-looking Statements and Non-GAAP Financial Information This presentation contains forward-looking statements Additional information on factors that could cause results and information. This presentation also contains non- to differ materially from this presentation is available in the GAAP me
Slide 3: Allstate's Strategy To Increase Shareholder Value
Allstate’s Strategy To Increase Shareholder Value Increase Personal 2022 Results Property-Liability Market Share • Net loss of $1.4 billion largely reflecting lower auto insurance profitability and mark-to-market losses on public equity investments • Executing comprehensive plan to improve auto insu
Slide 4: Allstate Is Focused on Improving Profitability
Allstate Is Focused on Improving Profitability Net loss reflects underwriting loss and decline in value of public equity holdings Three months ended Twelve months ended December 31, December 31, ($ in millions, except per share data and ratios) 2022 2021 Change 2022 2021 Change Total revenues $13,64
Slide 5: Underwriting Loss Due to Auto Insurance
Underwriting Loss Due to Auto Insurance Margin pressure driven by rapid severity Margins below target reflecting rapidly escalation beginning in 2021 increasing claim severity Property-Liability recorded and underlying combined ratio* Property-Liability combined ratio by product Recorded Underwritin
Slide 6: Auto Insurance Impacted by Rising Loss Costs
Auto Insurance Impacted by Rising Loss Costs Auto insurance combined ratio above historical Higher loss costs outpaced increasing earned performance and mid 90s target premium growth and a lower expense ratio Allstate Protection auto recorded and underlying combined ratio* Allstate Protection auto c
Slide 7: Prior Year Reserve Reestimates Also Negatively Impacted Auto and Commercial Insurance Combined Ratios
Prior Year Reserve Reestimates Also Negatively Impacted Auto and Commercial Insurance Combined Ratios Property-Liability non-catastrophe prior year reserve Majority of increases for years additions increased 2022 recorded combined ratio impacted by the pandemic by 3.9 points to 106.6 Property-Liabil
Slide 8: 2022 Auto Quarterly Underlying Combined Ratio Trend Essentially Flat When Adjusted for Increases in Full Year Severity
2022 Auto Quarterly Underlying Combined Ratio Trend Essentially Flat When Adjusted for Increases in Full Year Severity 2022 incurred severity(1) for collision, property Increasing current report year incurred damage and bodily injury coverages increased severities as the year progressed throughout t
Slide 9: Executing Comprehensive Approach to Restore Auto Margins
Executing Comprehensive Approach to Restore Auto Margins Auto insurance profit improvement will be driven by: Actions taken and planned: • Implemented Allstate brand rate increases of 16.9% in Rate • Pursuing rate actions 2022, including 6.1% in the fourth quarter Increases • Pricing expertise and s
Slide 10: Broadly Increasing Auto Insurance Prices
Broadly Increasing Auto Insurance Prices Growth in average earned premium per policy is Rate increases drove a $1.2 billion increase to accelerating, but lags average gross premium Allstate brand earned premium in 2022 due to 6-month policy terms compared to the prior year Allstate brand auto averag
Slide 11: Implemented Rate Actions Will Improve Auto Insurance Profitability; Additional Actions Needed
Implemented Rate Actions Will Improve Auto Insurance Profitability; Additional Actions Needed to Offset Future Loss Cost Increases Impact of rate actions already implemented and yet to be fully earned(1) expected to increase Prospective rate and other actions need future premiums and improve margins
Slide 12: Auto Insurance Profitability Actions Vary by State
Auto Insurance Profitability Actions Vary by State Approximately 45% of Allstate brand auto insurance underwriting loss from 3 major states 2022 full year state level results – Allstate brand auto Actions taken and planned in select states Underwriting Premiums Average California State(1) Income / (
Slide 13: Homeowners Insurance Generated Underwriting Income for the Quarter and Full Year
Homeowners Insurance Generated Underwriting Income for the Quarter and Full Year Increased average premiums due to inflation in insured Reflects catastrophe losses of $779 million home valuations and implemented rate increases primarily driven by Winter Storm Elliott Allstate Protection homeowners o
Slide 14: Net Investment Income Benefited From Higher Reinvestment Yields
Net Investment Income Benefited From Higher Reinvestment Yields Shorter duration fixed income portfolio has provided Reinvestment into higher market yields will opportunity to reinvest into higher market yields and continue to increase portfolio yield increase income Net investment income Fixed inco
Slide 15: Proactive Risk and Return Management Impacts Investment Allocations and Results
Proactive Risk and Return Management Impacts Investment Allocations and Results Enterprise Risk and Return Objectives Investment Allocations Investment Outcome • Lower overall risk levels due to • Reduced economic capital for • Avoided approximately $2 billion of declines in auto insurance profit, i
Slide 16: Allstate Protection Plans Continues Rapid Expansion
Allstate Protection Plans Continues Rapid Expansion Allstate Protection Plans revenues increased Unearned premiums increased to $2.6 billion, 16.9% compared to the prior year quarter which will be earned over next 3 – 5 years Protection Services revenues(1) Protection Services results ($ in millions
Slide 17: Allstate Health and Benefits Growth Through Expanded Protection Offering
Allstate Health and Benefits Growth Through Expanded Protection Offering Decline compared to the prior year quarter driven Reflects lower benefit ratio, Business expanded with the National by a reduction in individual health, which was General acquisition partially offset by partially offset by grow
Slide 18: Allstate's Financial Condition and Capital Position Remain Strong
Allstate’s Financial Condition and Capital Position Remain Strong Strong cash returns through combination of Achieving our target combined ratios $2.5 billion in share repurchases and $926 will generate returns in our 14-17% million in common shareholder dividends long-term target range Capital Posi
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Slide 20: Forward-looking Statements
Forward-looking Statements This presentation contains “forward-looking statements” that anticipate (10) a downgrade in financial strength ratings; results based on our estimates, assumptions and plans that are subject to o Business, Strategy and Operations (11) competition in the industries uncertai
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