Allstate Q4 Profit Surges Amid Lower Catastrophe Losses - Update

(RTTNews) - Insurer Allstate Corp. (ALL) Wednesday reported a surge in fourth-quarter profit, amid higher revenues and lower claims. The company grew insurance policies in force in all three brands where it underwrites risk.

Net income available to shareholders increased to $810 million or $1.76 per share from $394 million or $0.81 per share last year.

Operating income was $781 million or $1.70 per share for the quarter, while it totaled $289 million or $0.59 per share in the same quarter last year.

The prior year results included $1.12 billion in pre-tax catastrophe losses related to Sandy. In the just concluded quarter, results included settlement charges of $103 million, related to the level of lump sum pension benefit payments made to retiring employees.

On average, 26 analysts polled by Thomson Reuters expected the company to report profit per share of $1.38 for the quarter. Analysts' estimates typically exclude special items.

Consolidated revenues improved to $8.79 billion from $8.55 billion. Analysts expected revenue of $6.89 billion for the quarter.

Insurance premiums grew in all brands. Allstate Protection net written premium increased 4.7 percent, while Allstate brand policies increased 0.4 percent. Allstate Financial premiums and contract charges grew 7.8 percent, including a 6.3 percent increase in underwritten products.

Property-liability insurance claims and claims expense reduced significantly to $4.283 billion from $5.042 billion. Catastrophe losses for the quarter plunged 89 percent to $117 million from $1.061 billion. Thomas Wilson, CEO of Allstate, said, "Successful execution of our customer-focused strategy and proactive risk and return management led to strong results for the fourth quarter and the full year 2013.''

Wilson added that the insurer grew insurance policies in force in all three brands where it underwrites risk, reflecting differentiated value propositions, strong marketing, expanded distribution and a smaller decline in Allstate brand homeowners policies.

ALL closed down 0.7 percent at $49.55 and gained 2.3 percent in the extended trade.