Allstate Profit Rises On Lower Catastrophe Losses

(RTTNews) - Home and auto insurer Allstate Corp. (ALL), Wednesday said its second-quarter profit improved from a year ago, reflecting mainly lower catastrophe losses for the period.

Catastrophe losses for the second quarter dropped 21 percent to $647 million from $819 million last year.

Northbrook, Illinois-based Allstate's second-quarter profit rose to $434 million or $0.92 per share from $423 million or $0.86 per share a year ago.

Operating income, which excludes some investment results, for the quarter rose to $529 million or $1.12 per share from $432 million or $0.87 per share last year. On average, 26 analysts polled by Thomson Reuters expected earnings of $0.98 per share for the quarter. Analysts' estimates typically exclude special items.

Consolidated revenues for the quarter grew 6.1 percent to $8.79 billion from $8.28 billion last year. Property-liability premiums written rose 4.2 percent to $7.15 billion from $6.86 billion last year, while premiums earned rose to $6.86 billion from $6.67 billion.

Ten analysts had a consensus revenue estimate of $7.00 billion for the quarter.

"The company experienced positive momentum in growing insurance premiums in the second quarter," Allstate said in a statement. Property-Liability combined ratio, a measure of profitability used by insurance companies, improved to 96.1 percent from 98.0 percent in the prior-year period. A ratio below 100 percent indicates the company is making underwriting profit while a ratio above 100 percent means it is paying out more money in claims than it is receiving from premiums.

Earlier this month, Allstate had announced that it will sell its Lincoln Benefit Life Co. to Resolution Life Holdings Inc. for $600 million, thereby exiting the consumer segment served by independent life insurance and annuity agencies.

ALL closed Wednesday's trading at $50.98, up $0.07 or 0.14%, on the NYSE. The stock further gained $0.32 or 0.63% in after hours trade. Trading volume for the day was 2.9 million shares, below the three-month average volume of 3.4 million.