Business Services Industry
Allstate Reports 22% Increase in 2005 First Quarter Net Income EPS, 16% Increase in First Quarter Operating Income EPS and Record Property-Liability Underwriting Profitability
Business Wire, April 20, 2005
Consolidated Highlights
Three Months Ended Discussion of Results for the
March 31, Three Months Ended March 31, 2005
------------------ ---------------------------------
($ in millions,
except per share
and return Est.
amounts) 2005 2004
--------- --------
Consolidated $8,705 $8,311 Growth of Property-Liability
revenues premiums earned, higher life and
annuity premiums and contract
charges and higher net
investment income, partially
offset by lower net realized
capital gains due to anticipated
disposition write-downs.
Operating income 1,140 1,020 Increase in Property-Liability
operating income of $107 and
Allstate Financial operating
income of $17.
Realized capital 80 120 See the Components of Realized
gains and Capital Gains and Losses
losses, after-tax (pretax) table.
DAC and DSI (61) (10) Amortization related to certain
amortization realized capital gains.
relating to
realized
capital gains
and losses,
after-tax
Non-recurring (22) -- Increase in liability for future
increase in benefits for a discontinued
liability for benefit plan.
future benefits,
after-tax
Cumulative effect -- (175) Adoption of AICPA SOP 03-1,
of change in "Accounting and Reporting by
accounting Insurance Enterprises for
principle, Certain Nontraditional Long-
after-tax Duration Contracts and for
Separate Accounts" in the first
quarter of 2004.
Net income 1,123 949 Increase in Property-Liability
and Allstate Financial operating
income.
Net income per 1.64 1.34 See discussion of Exposure to
share (diluted) Potential Subsequent Event for
Citizens Property Insurance
Corporation Assessment of up to
$0.04 per diluted share.
Operating income 1.67 1.44
per share
(diluted)
Net shares 672.1 703.2 During the first quarter of 2005,
outstanding Allstate purchased 13.4 million
shares of its stock for $706
million.
Weighted average 683.1 709.2
shares
outstanding
(diluted)
Return on equity 15.6 15.1 See the return on equity
calculation in the Definitions
of Non-GAAP and Operating
Measures section of this
document.
Operating income 17.2 18.0 See the return on equity
return on equity calculation in the Definitions
of Non-GAAP and Operating
Measures section of this
document.
Book value per 31.48 30.48 At March 31, 2005 and 2004, net
diluted share unrealized gains on fixed income
securities, after-tax, totaling
$1,385 and $2,611, respectively,
represented $2.05 and $3.69,
respectively, of book value per
diluted share.
-- Book value per diluted share increased 3.3% compared to March 31,
2004. Book value per diluted share excluding the net impact of
unrealized net capital gains on fixed income securities(1) was
$29.44 at March 31, 2005, reflecting increases of 9.9% and 2.9%
compared to March 31, 2004 and December 31, 2004, respectively.
Property-Liability Highlights
Three Months Ended Discussion of Results for the
March 31, Three Months Ended March 31, 2005
------------------ ---------------------------------
($ in millions, Est.
except ratios) 2005 2004
--------- --------
Property-Liability $6,582 $6,333 See the Property-Liability
net premiums Premiums Written by Market
written Segment table.
Property-Liability 7,233 6,986 Premiums earned increased $313 or
revenues 4.9%, partially offset by lower
realized net capital gains.
Underwriting 981 865 Higher premiums earned and
income / (loss) continued favorable auto and
homeowners loss frequencies.
See the Allstate Protection
Market Segment Analysis table.
Net investment 436 424 Higher portfolio balances due to
income positive cash flows from
operations, partially offset by
lower yields.
Operating income 1,019 912 Increase of $75 in underwriting
results, after-tax and a
reduction of $27 of prior year
tax liabilities.
Realized capital 78 132 See the Components of Realized
gains and losses, Capital Gains and Losses
after-tax (pretax) table.
Net income 1,097 1,044 Higher operating income. See
discussion of Exposure to
Potential Subsequent Event for
Citizens Property Insurance
Corporation Assessment.
Catastrophe losses 164 102
Ratios:
Property-Liability
combined ratio 85.3 86.4
Effect of
Discontinued
Lines and
Coverages 0.1 0.1
Allstate
Protection
combined ratio 85.2 86.3
Effect of
catastrophe
losses 2.5 1.6
-- Allstate brand standard auto and homeowners PIF increased 4.9% and
6.0%, respectively, from March 31, 2004 levels, compared to
increases of 5.5% and 6.4%, respectively in the fourth quarter of
2004 over the fourth quarter of 2003. Both standard auto and
homeowners experienced PIF growth in most states. These results
exclude impacts from Allstate Canada.
-- Allstate brand standard auto and homeowners retention ratio,
excluding the impacts of Allstate Canada, increased to 90.7 and
88.5, respectively, from 90.4 and 87.8 in the prior year first
quarter.
-- Allstate brand standard auto and homeowners new business premiums
declined 2.3% and 3.5%, respectively, as compared to the first
quarter of 2004, primarily due to declines in certain markets from
competitive pressures due to risk selection and pricing
strategies. We are experiencing a decline of standard auto new
business due to new entrants in a major market. In homeowners, we
are curtailing our writings of new business in some markets due to
catastrophe exposure management. We will continue our disciplined
risk and pricing approach, seeking profitable growth on a
market-by-market basis. These results exclude impacts from
Allstate Canada.
Allstate Financial Highlights
Three Months Ended Discussion of Results for the
March 31, Three Months Ended March 31, 2005
------------------ ---------------------------------
($ in millions) Est.
2005 2004
--------- --------
Premiums and $3,979 $3,455 See the Allstate Financial
deposits Premiums and Deposits table.
Allstate Financial 1,440 1,294 Higher investment income, life
revenues and annuity premiums and
contract charges and realized
net capital gains.
Operating income 149 132 Higher gross margins and lower
income taxes due to a reduction
of $14 of prior years tax
liabilities, partially offset by
higher non-deferred expenses,
DAC and DSI unlocking of $7 and
an increase in variable annuity
reserves of $9.
Realized capital 1 (14) See the Components of Realized
gains and losses, Capital Gains and Losses
after-tax (pretax) table.
DAC and DSI (61) (10) Amortization related to certain
amortization realized capital gains.
relating to
realized capital
gains and losses,
after-tax
Non-recurring (22) -- Increase in liability for future
increase in benefits for a discontinued
liability for benefit plan.
future benefits,
after-tax
Cumulative effect -- (175) Adoption of AICPA SOP 03-1,
of change in "Accounting and Reporting by
accounting Insurance Enterprises for
principle, Certain Nontraditional Long-
after-tax Duration Contracts and for
Separate Accounts" in the first
quarter of 2004.
Net income 53 (73) Cumulative effect of change in
accounting principle, after-tax
in 2004, higher operating
income, higher realized net
capital gains, after-tax,
partially offset by DAC and DSI
amortization related to these
capital gains.
-- Investments including Separate Account assets as of March 31, 2005
increased 10.0% over March 31, 2004 primarily due to strong sales
of fixed annuities and funding agreements.
-- As of March 31, 2005, 77% of our interest-sensitive life and fixed
annuity contracts, excluding market value adjusted annuities, have
a guaranteed crediting rate of 3% or higher. Of these contracts,
76% have crediting rates that are at the minimum as of March 31,
2005. For all interest-sensitive life and fixed annuity contracts,
excluding market value adjusted annuities, the approximate
difference between the weighted average crediting rate and the
average guaranteed crediting rate is 51 basis points as of March
31, 2005 compared to 52 basis points as of December 31, 2004.
-- In the first quarter of 2005, we performed our annual
comprehensive evaluation of the assumptions used in our valuation
models for all investment products, including variable and fixed
annuities and interest-sensitive and variable life products. This
evaluation resulted in a net reduction of operating income of $16
million pre-tax, primarily consisting of the following
adjustments:
-- Deferred acquisition costs ("DAC") and deferred sales
inducements ("DSI") unlocking adjustment of $7 million. The
DAC and DSI unlocking includes amortization acceleration on
fixed annuities of $62 million and $3 million on
interest-sensitive and variable life products, partially
offset by amortization deceleration on variable annuities of
$58 million. The amortization acceleration on fixed annuities
was primarily due to higher than expected lapses on market
value adjusted annuities during the 30-45 day window in which
there were no surrender charges or market value adjustments,
and faster than anticipated portfolio yield declines. The
amortization deceleration on variable annuities was mostly
attributable to better than anticipated equity market
performance and persistency.
-- The reserves for guarantees related to variable contracts were
increased $9 million due primarily to a refined measurement of
exposure, partially offset by better than anticipated equity
market performance.
-- In the first quarter of 2004, the comparable DAC and DSI
unlocking was a net acceleration of amortization of $0.5
million, which included deceleration of amortization related
to interest-sensitive life and acceleration of amortization
related to fixed annuities. There was no comparable adjustment
to reserves for variable contract guarantees, because the
reserves were established in the first quarter of 2004 as part
of the cumulative effect of the change in accounting for such
guarantees.
THE ALLSTATE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended
March 31,
--------------------
Est. Percent
($ in millions, except per share data) 2005 2004 Change
--------- --------- ---------
Revenues
Property-liability insurance
premiums $ 6,684 $ 6,371 4.9
Life and annuity premiums
and contract charges 521 496 5.0
Net investment income 1,384 1,274 8.6
Realized capital gains and losses 116 170 (31.8)
--------- ---------
Total revenues 8,705 8,311 4.7
--------- ---------
Costs and expenses
Property-liability insurance
claims and claims expense 4,063 3,986 1.9
Life and annuity contract benefits 411 395 4.1
Interest credited to contractholder
funds 591 470 25.7
Amortization of deferred policy
acquisition costs 1,196 1,055 13.4
Operating costs and expenses 800 733 9.1
Restructuring and related charges 18 11 63.6
Interest expense 84 74 13.5
--------- ---------
Total costs and expenses 7,163 6,724 6.5
--------- ---------
Loss on disposition of operations (4) (3) (33.3)
Income from operations before income
tax expense and cumulative effect of
change in accounting principle,
after-tax 1,538 1,584 (2.9)
Income tax expense 415 460 (9.8)
--------- ---------
Income before cumulative effect of
change in accounting principle,
after-tax 1,123 1,124 (0.1)
Cumulative effect of change in
accounting principle, after-tax - (175) 100.0
--------- ---------
Net income $ 1,123 $ 949 18.3
========= =========
Net income per share - Basic $ 1.66 $ 1.35
========= =========
Weighted average shares - Basic 677.7 704.5
========= =========
Net income per share - Diluted $ 1.64 $ 1.34
========= =========
Weighted average shares - Diluted 683.1 709.2
========= =========
THE ALLSTATE CORPORATION
CONTRIBUTION TO INCOME
Three Months Ended
March 31,
--------------------
Est. Percent
($ in millions, except per share data) 2005 2004 Change
--------- --------- ---------
Contribution to income
Operating income before the impact of
restructuring and related charges $ 1,152 $ 1,027 12.2
Restructuring and related charges,
after-tax 12 7 71.4
--------- ---------
Operating income 1,140 1,020 11.8
Realized capital gains and losses,
after-tax 80 120 (33.3)
DAC and DSI amortization relating to
realized capital gains and losses,
after-tax (61) (10) -
Non-recurring increase in liability
for future benefits, after-tax (1) (22) - -
Reclassification of periodic
settlements and accruals on non-hedge
derivative instruments, after-tax (12) (4) -
Loss on disposition of operations,
after-tax (2) (2) -
Cumulative effect of change in
accounting principle, after-tax - (175) 100.0
--------- ---------
Net income $ 1,123 $ 949 18.3
========= =========
Income per share (Diluted)
Operating income before the impact of
restructuring and related charges $ 1.69 $ 1.45 16.6
Restructuring and related charges,
after-tax 0.02 0.01 100.0
--------- ---------
Operating income 1.67 1.44 16.0
Realized capital gains and losses,
after-tax 0.12 0.17 (29.4)
DAC and DSI amortization relating to
realized capital gains and losses,
after-tax (0.09) (0.01) -
Non-recurring increase in liability
for future benefits, after-tax (1) (0.03) - -
Reclassification of periodic
settlements and accruals on non-hedge
derivative instruments, after-tax (0.02) (0.01) (100.0)
Loss on disposition of operations,
after-tax (0.01) - -
Cumulative effect of change in
accounting principle, after-tax - (0.25) 100.0
--------- ---------
Net income $ 1.64 $ 1.34 22.4
========= =========
Book value per share - Diluted $ 31.48 $ 30.48 3.3
========= =========
(1) The non-recurring increase in liability for future benefits is for
a discontinued benefit plan.
THE ALLSTATE CORPORATION
COMPONENTS OF REALIZED CAPITAL GAINS AND LOSSES (PRETAX)
Three Months Ended March 31, 2005 (Est.)
----------------------------------------------
($ in millions) Property- Allstate Corporate
Liability Financial and Other Total
---------- ----------- ---------- ---------
Valuation of derivative
instruments $ (13) $ (58) $ - $ (71)
Settlements of
derivative instruments 10 26 - 36
Dispositions 196 70 2 268
Write-downs (10) (7) - (17)
Anticipated disposition
write-downs (1) (70) (30) - (100)
---------- ----------- ---------- ---------
Total $ 113 $ 1 $ 2 $ 116
========== =========== ========== =========
Three Months Ended March 31, 2004
----------------------------------------------
($ in millions) Property- Allstate Corporate
Liability Financial and Other Total
---------- ----------- ---------- ---------
Valuation of derivative
instruments $ (11) $ (16) $ (1) $ (28)
Settlements of
derivative instruments (11) (8) (1) (20)
Dispositions 220 36 4 260
Write-downs (7) (35) - (42)
---------- ----------- ---------- ---------
Total $ 191 $ (23) $ 2 $ 170
========== =========== ========== =========
(1) Because of rising interest rates, continued asset-liability
management strategies and on-going comprehensive reviews of our
portfolios, changes were made in the first quarter to our
strategic asset allocations, and our view of duration for our
Property-Liability portfolio. We also pursued yield enhancement
strategies for the Allstate Financial portfolio. These changes
primarily resulted in anticipated disposition write-downs of
certain securities with unrealized loss positions due to a change
in intent to hold these securities until recovery.
THE ALLSTATE CORPORATION
SEGMENT RESULTS
Three Months Ended
March 31,
---------------------
($ in millions) Est.
2005 2004
--------- ---------
Property-Liability
Premiums written $ 6,582 $ 6,333
========= =========
Premiums earned $ 6,684 $ 6,371
Claims and claims expense 4,063 3,986
Amortization of deferred policy
acquisition costs 1,012 924
Operating costs and expenses 610 585
Restructuring and related charges 18 11
--------- ---------
Underwriting income 981 865
--------- ---------
Net investment income 436 424
Income tax expense on operations 398 377
--------- ---------
Operating income 1,019 912
Realized capital gains and losses, after-tax 78 132
--------- ---------
Net income $ 1,097 $ 1,044
========= =========
Catastrophe losses $ 164 $ 102
========= =========
Operating ratios
Claims and claims expense ratio 60.8 62.6
Expense ratio 24.5 23.8
--------- ---------
Combined ratio 85.3 86.4
========= =========
Effect of catastrophe losses on combined
ratio 2.5 1.6
========= =========
Effect of restructuring and related charges
on combined ratio 0.3 0.2
========= =========
Effect of Discontinued Lines and Coverages
on combined ratio 0.1 0.1
========= =========
Allstate Financial
Premiums and deposits $ 3,979 $ 3,455
========= =========
Investments including Separate Accounts
assets $ 88,105 $ 80,122
========= =========
Premiums and contract charges $ 521 $ 496
Net investment income 918 821
Periodic settlements and accruals on non-hedge
derivative instruments 19 6
Contract benefits 411 395
Interest credited to contractholder funds 566 469
Amortization of deferred policy acquisition
costs 115 117
Operating costs and expenses 160 145
Income tax expense on operations 57 65
--------- ---------
Operating income 149 132
Realized capital gains and losses, after-tax 1 (14)
DAC and DSI amortization relating to realized
capital gains and losses, after-tax (61) (10)
Non-recurring increase in liability for future
benefits, after-tax (1) (22) -
Reclassification of periodic settlements and
accruals on non-hedge derivative instruments,
after-tax (12) (4)
Loss on disposition of operations, after-tax (2) (2)
Cumulative effect of change in accounting
principle, after-tax - (175)
--------- ---------
Net income (loss) $ 53 $ (73)
========= =========
Corporate and Other
Net investment income $ 30 $ 29
Operating costs and expenses 86 77
Income tax benefit on operations (28) (24)
--------- ---------
Operating loss (28) (24)
Realized capital gains and losses, after-tax 1 2
--------- ---------
Net loss $ (27) $ (22)
========= =========
Consolidated net income $ 1,123 $ 949
========= =========
(1) The non-recurring increase in liability for future benefits is for
a discontinued benefit plan.
THE ALLSTATE CORPORATION
UNDERWRITING RESULTS BY AREA OF BUSINESS
Three Months Ended
March 31,
--------------------
Est. Percent
($ in millions) 2005 2004 Change
--------- --------- ---------
Consolidated Underwriting Summary
Allstate Protection $ 990 $ 870 13.8
Discontinued Lines and Coverages (9) (5) (80.0)
--------- ---------
Underwriting income $ 981 $ 865 13.4
========= =========
Allstate Protection Underwriting Summary
Premiums written $ 6,581 $ 6,332 3.9
========= =========
Premiums earned $ 6,682 $ 6,370 4.9
Claims and claims expense 4,055 3,982 1.8
Amortization of deferred policy
acquisition costs 1,012 924 9.5
Operating costs and expenses 607 583 4.1
Restructuring and related charges 18 11 63.6
--------- ---------
Underwriting income $ 990 $ 870 13.8
========= =========
Catastrophe losses $ 164 $ 102 60.8
========= =========
Operating ratios
Claims and claims expense ratio 60.7 62.5
Expense ratio 24.5 23.8
--------- ---------
Combined ratio 85.2 86.3
========= =========
Effect of catastrophe losses
on combined ratio 2.5 1.6
========= =========
Effect of restructuring and related
charges on combined ratio 0.3 0.2
========= =========
Discontinued Lines and Coverages
Underwriting Summary
Premiums written $ 1 $ 1 -
========= =========
Premiums earned $ 2 $ 1 100.0
Claims and claims expense 8 4 100.0
Operating costs and expenses 3 2 50.0
--------- ---------
Underwriting loss $ (9) $ (5) (80.0)
========= =========
Effect of Discontinued Lines and
Coverages on the Property-Liability
combined ratio 0.1 0.1
========= =========
THE ALLSTATE CORPORATION
PROPERTY-LIABILITY PREMIUMS WRITTEN BY MARKET SEGMENT
Three Months Ended
March 31,
--------------------
Est. Percent
($ in millions) 2005 2004 Change
--------- --------- ---------
Allstate brand
Standard auto $ 3,798 $ 3,607 5.3
Non-standard auto 426 473 (9.9)
--------- ---------
Auto 4,224 4,080 3.5
Involuntary auto 53 60 (11.7)
Commercial lines 233 229 1.7
Homeowners 1,258 1,161 8.4
Other personal lines 324 324 -
--------- ---------
6,092 5,854 4.1
Encompass brand
Standard auto 282 280 0.7
Non-standard auto (Deerbrook) 32 43 (25.6)
--------- ---------
Auto 314 323 (2.8)
Involuntary auto 12 12 -
Homeowners 135 119 13.4
Other personal lines 28 24 16.7
--------- ---------
489 478 2.3
Allstate Protection (1) 6,581 6,332 3.9
Discontinued Lines
and Coverages 1 1 -
--------- ---------
Property-Liability (1) $ 6,582 $ 6,333 3.9
========= =========
Allstate Protection
Standard auto $ 4,080 $ 3,887 5.0
Non-standard auto 458 516 (11.2)
--------- ---------
Auto 4,538 4,403 3.1
Involuntary auto 65 72 (9.7)
Commercial lines 233 229 1.7
Homeowners 1,393 1,280 8.8
Other personal lines 352 348 1.1
--------- ---------
$ 6,581 $ 6,332 3.9
========= =========
(1) In the first quarter of 2005, growth in premiums written was
negatively impacted by accruals for premium refunds and
reinsurance transactions totaling 0.3%.
THE ALLSTATE CORPORATION
PROPERTY-LIABILITY NET RATE CHANGES APPROVED (1)
Three Months Ended
March 31, 2005 (Est.)
------------------------------------------------
Annual Impact
of Rate Changes on
Weighted Average State Specific
Number of Rate Change Premiums Written
States (%) (2) (%) (3)
------------ ---------------- ------------------
Allstate brand
Standard auto 7 0.1 2.7
Non-standard auto 1 0.0 4.6
Homeowners 6 0.3 4.8
Encompass brand
Standard auto 10 0.1 0.3
Homeowners 6 0.4 4.0
(1) Rate increases that are indicated based on a loss trend analysis
to achieve a targeted return, will continue to be pursued in all
locations and for all products.
(2) Represents the impact in the states where rate changes were
approved during the first quarter of 2005 as a percentage of total
countrywide year-end premiums written.
(3) Represents the impact in the states where rate changes were
approved during the first quarter of 2005 as a percentage of total
year-end premiums written in those states.
THE ALLSTATE CORPORATION
ALLSTATE PROTECTION MARKET SEGMENT ANALYSIS
Three Months Ended March 31,
-----------------------------------------------------
($ in millions) Est. Est. Est. Est.
2005 2004 2005 2004 2005 2004 2005 2004
------- ------- ----- ----- ------ ------ ----- -----
Effect of
Catastrophe
Losses on the Expense
Premiums Earned Loss Ratio Loss Ratio Ratio
--------------- ----------- ------------- -----------
Allstate brand
Standard
auto $ 3,691 $ 3,486 64.8 66.8 0.7 (0.4) 24.3 23.6
Non-standard
auto 425 474 62.6 62.4 0.5 0.2 20.9 19.7
------- -------
Auto 4,116 3,960 64.5 66.3 0.6 (0.3) 24.0 23.1
Homeowners 1,425 1,300 49.8 48.6 7.9 7.2 22.9 22.6
Other (1) 629 604 58.7 63.1 2.1 2.2 25.9 26.8
------- -------
Total
Allstate
brand 6,170 5,864 60.6 62.0 2.5 1.5 23.9 23.4
Encompass brand
Standard auto 301 300 63.8 68.7 0.3 - 32.5 29.3
Non-standard
auto
(Deerbrook) 34 43 76.5 79.1 - - 29.4 27.9
------- -------
Auto 335 343 65.1 70.0 0.3 - 32.2 29.1
Homeowners 139 128 54.0 57.8 5.8 6.2 30.9 30.5
Other (1) 38 35 68.4 85.7 5.2 2.8 29.0 28.6
------- -------
Total
Encompass
brand 512 506 62.3 68.0 2.1 1.8 31.6 29.4
------- -------
Allstate
Protection $ 6,682 $ 6,370 60.7 62.5 2.5 1.6 24.5 23.8
======= =======
(1) Other includes involuntary auto, commercial lines and other
personal lines.
THE ALLSTATE CORPORATION
PROPERTY-LIABILITY
EFFECT OF PRETAX PRIOR YEAR RESERVE REESTIMATES ON THE COMBINED RATIO
Three Months Ended March 31,
--------------------------------------------------
Effect of Pretax Reserve
Pretax Re-estimates on the
Reserve Re-estimates (1) Combined Ratio
------------------------ ------------------------
Est. Est.
($ in millions) 2005 2004 2005 2004
----------- ----------- ----------- -----------
Auto $ (93) $ (47) (1.4) (0.7)
Homeowners 11 (2) 0.2 -
Other (6) (3) (0.1) (0.1)
----------- ----------- ----------- -----------
Allstate
Protection (88) (52) (1.3) (0.8)
Discontinued
Lines and
Coverages 8 4 0.1 0.1
----------- ----------- ----------- -----------
Property-
Liability $ (80) $ (48) (1.2) (0.7)
=========== =========== =========== ===========
Allstate brand $ (87) $ (52) (1.3) (0.8)
Encompass brand (1) - - -
----------- ----------- ----------- -----------
Allstate
Protection $ (88) $ (52) (1.3) (0.8)
=========== =========== =========== ===========
(1) Favorable reserve reestimates are shown in parentheses.
THE ALLSTATE CORPORATION
ALLSTATE FINANCIAL PREMIUMS AND DEPOSITS
Three Months Ended
March 31,
--------------------
Est. Percent
($ in millions) 2005 2004 Change
--------- --------- ---------
Life Products (1)
Interest-sensitive life $ 359 $ 362 (0.8)
Traditional 72 82 (12.2)
Other 103 81 27.2
--------- ---------
534 525 1.7
Annuities
Fixed annuities - deferred 1,525 1,084 40.7
Fixed annuities - immediate 294 206 42.7
Variable annuities 404 451 (10.4)
--------- ---------
2,223 1,741 27.7
Institutional Products
Indexed funding agreements - 1 (100.0)
Funding agreements backing
medium-term notes 1,098 1,100 (0.2)
--------- ---------
1,098 1,101 (0.3)
Bank Deposits 124 88 40.9
--------- ---------
Total $ 3,979 $ 3,455 15.2
========= =========
(1) To conform to current period presentations, certain prior period
balances have been reclassified.
THE ALLSTATE CORPORATION
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
March 31, December 31,
($ in millions, except par value data) 2005 (Est.) 2004
------------ ------------
Assets
Investments
Fixed income securities, at fair value
(amortized cost $93,024 and $90,657) $ 96,695 $ 95,715
Equity securities, at fair value
(cost $4,618 and $4,566) 5,749 5,895
Mortgage loans 8,161 7,856
Short-term 4,427 4,133
Other 1,851 1,931
------------ ------------
Total investments 116,883 115,530
Cash 339 414
Premium installment receivables, net 4,810 4,721
Deferred policy acquisition costs 5,375 4,968
Reinsurance recoverables, net 4,307 4,323
Accrued investment income 1,093 1,014
Property and equipment, net 1,013 1,018
Goodwill 825 825
Other assets 2,734 2,535
Separate Accounts 14,087 14,377
------------ ------------
Total assets $ 151,466 $ 149,725
============ ============
Liabilities
Reserve for property-liability insurance
claims and claims expense $ 18,958 $ 19,338
Reserve for life-contingent contract
benefits 12,131 11,754
Contractholder funds 57,494 55,709
Unearned premiums 9,810 9,932
Claim payments outstanding 718 787
Other liabilities and accrued expenses 11,332 9,842
Deferred income taxes 256 829
Short-term debt 75 43
Long-term debt 5,280 5,291
Separate Accounts 14,087 14,377
------------ ------------
Total liabilities 130,141 127,902
------------ ------------
Shareholders' equity
Preferred stock, $1 par value, 25 million
shares authorized, none issued - -
Common stock, $.01 par value, 2.0 billion
shares authorized and 900 million issued,
672 million and 683 million shares outstanding 9 9
Additional capital paid-in 2,763 2,685
Retained income 24,950 24,043
Deferred compensation expense (152) (157)
Treasury stock, at cost (228 million and
217 million shares) (7,980) (7,372)
Accumulated other comprehensive income:
Unrealized net capital gains and losses 2,111 2,988
Unrealized foreign currency translation
adjustments 13 16
Minimum pension liability adjustment (389) (389)
------------ ------------
Total accumulated other
comprehensive income 1,735 2,615
------------ ------------
Total shareholders' equity 21,325 21,823
------------ ------------
Total liabilities and shareholders'
equity $ 151,466 $ 149,725
============ ============
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