ALLSTATE CORP

(1) Balances reflect the elimination of related-party investments between segments.

(2) Fixed income securities are carried at fair value. Amortized cost, net for these securities was $49.15 billion, $1.90 billion, $151 million, $1.14 billion and $52.34 billion for Property-Liability, Protection Services, Allstate Health and Benefits, Corporate and Other, and in total, respectively.

(3) Equity securities are carried at fair value. The fair value of equity securities held as of March 31, 2025, was $73 million in excess of cost. These net gains were primarily concentrated in the banking and communications sectors. Equity securities include $920 million of funds with underlying investments in fixed income securities as of March 31, 2025.

(4) Short-term investments are carried at fair value.

(5) As of March 31, 2025, $2.07 billion of investments are classified as held for sale.

Investments totaled $74.05 billion as of March 31, 2025, increasing from $72.61 billion as of December 31, 2024, primarily due to positive operating and investment cash flows.

Portfolio composition by investment strategy We utilize two primary strategies to manage risks and returns and to position our portfolio to take advantage of market opportunities while attempting to mitigate adverse effects. As strategies and market conditions evolve, the asset allocation may change.

Market-based strategy seeks to deliver predictable earnings aligned to business needs and provide flexibility to adjust investment risk profile based on

enterprise objectives and market opportunities primarily through public and private fixed income investments and public equity securities.

Performance-based strategy seeks to deliver attractive risk-adjusted returns and supplement market risk with idiosyncratic risk primarily through investments in private equity, including infrastructure investments, and real estate with a majority being limited partnerships. These investments include investee level expenses, reflecting asset level operating expenses on directly held real estate and other consolidated investments.

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Fixed income securities

Fixed income securities are rated by third-party credit rating agencies or are internally rated. The Securities Valuation Office (“SVO”) of the National Association of Insurance Commissioners (“NAIC”) evaluates the fixed income securities of insurers for regulatory reporting and capital assessment purposes. The NAIC assigns securities to one of six credit quality categories defined as “NAIC designations”. In general, securities with NAIC designations of 1 and 2 are considered investment grade and securities with NAIC designations of 3 through 6 are considered below investment grade. The rating is either received from the SVO based on availability of applicable ratings from rating agencies on the NAIC Nationally Recognized Statistical Rating Organizations provider list, including Moody’s Investors Service (“Moody’s”), S&P Global Ratings (“S&P”), Fitch Ratings (“Fitch”) or a comparable internal rating.

As a result of time lags between the funding of investments, the finalization of legal documents, and the completion of the SVO filing process, the portfolio includes certain securities that have not yet been designated by the SVO as of each balance sheet date and the categorization of these securities is based on the expected ratings indicated by internal analysis.

As of March 31, 2025, 91.2% of the consolidated fixed income securities portfolio was rated investment grade. Credit ratings below these designations are considered lower credit quality or below investment grade, which includes high yield bonds.

Market prices for certain securities may have credit spreads which imply higher or lower credit quality than the current third-party rating. Our initial investment decisions and ongoing monitoring procedures for fixed income securities are based on a due diligence process which includes, but is not limited to, an assessment of the credit quality, sector, structure and liquidity risks of each issuer.

Fixed income portfolio monitoring is a comprehensive process to identify and evaluate each fixed income security that may require a credit loss allowance. The process includes a quarterly review of all securities to identify instances where the fair value of a security compared to its amortized cost is below internally established thresholds. For further detail on our fixed income portfolio monitoring process, see Note 5 of the condensed consolidated financial statements.

First Quarter 2025 Form 10-Q 61

The following table presents total fixed income securities by the applicable NAIC designation and comparable S&P rating.

Municipal bonds, including tax-exempt and taxable securities, include general obligations of state and local issuers and revenue bonds.

Corporate bonds include publicly traded and privately placed securities. Privately placed securities primarily consist of corporate issued senior debt securities that are negotiated with the borrower or are issued by public entities in unregistered form.

ABS includes collateralized debt obligations, consumer and other ABS. Credit risk is managed by monitoring the performance of the underlying collateral. Many of the securities in the ABS portfolio have credit enhancement with features such as overcollateralization, subordinated structures, reserve funds, guarantees or insurance. ABS also includes residential mortgage-backed securities and commercial mortgage-backed securities.

Equity securities of $4.47 billion primarily include common stocks, exchange traded and mutual funds, non-redeemable preferred stocks and REITs. Exchange traded and mutual funds that have fixed income securities as their underlying investments total $920 million as of March 31, 2025.

Mortgage loansof $770 million comprise loans secured by first mortgages on developed commercial real estate of $690 million and residential mortgage loans of $80 million. Key considerations used to manage our exposure include property type and geographic diversification. For further detail on our mortgage loan portfolio, see Note 5 of the condensed consolidated financial statements.

Limited partnership interests include $7.74 billion of interests in private equity funds, $1.36 billion of interests in real estate funds and $281 million of interests in other funds as of March 31, 2025. We have commitments to invest additional amounts in limited partnership interests totaling $3.25 billion as of March 31, 2025.

Other investments include $274 million of bank loans, net and $625 million of direct investments in real estate as of March 31, 2025.

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First Quarter 2025 Form 10-Q 63

In general, gross unrealized losses are related to an increase in market yields, which may include increased risk-free interest rates and wider credit spreads since the time of initial purchase. Similarly, gross unrealized gains reflect a decrease in market yields since the time of initial purchase.

(1)Other is generally comprised of transportation and communications sectors.

Net investment income increased 11.8% or $90 million in the first quarter of 2025, due to higher market-based results. Market-based investment results continue to benefit from higher investment balances and portfolio repositioning into higher yielding fixed income securities.

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(1)Investee level expenses include asset level operating expenses on directly held real estate and other consolidated investments reported in investment expense.

Performance-based investment income decreased 2.5% or $5 million in the first quarter of 2025 compared to the same period of 2024 primarily due to lower private equity valuation increases offset by higher real estate investment results.

Performance-based investment results and income can vary significantly between periods and are influenced by economic conditions, equity market performance, comparable public company earnings multiples, capitalization rates, operating performance of the underlying investments and the timing of asset sales. The Company typically employs a lag in recording and recognizing changes in valuations of limited partnership interests due to the availability of investee financial statements.

(1)2025 includes losses recorded for variable interests in Reciprocal Exchanges. 2024 includes losses related to the carrying value of the surplus notes issued by Reciprocal Exchanges. See Note 8 for further details.

(2)Relates to limited partnerships where the underlying assets are predominately public equity securities.

Net losses on investments and derivatives in the first quarter of 2025 primarily related to losses on sales of fixed income securities, valuation losses on equity investments and losses recorded for variable interests in Reciprocal Exchanges.

Net losses on sales in the first quarter of 2025 related primarily to sales of fixed income securities in connection with ongoing portfolio management.

Net losses on valuation change and settlements of derivatives of $19 million in the first quarter of 2025 primarily related to losses on foreign currency contracts used to manage foreign currency risk.

First Quarter 2025 Form 10-Q 65

Net losses on performance-based investments and derivatives in the first quarter of 2025 primarily related to decreased valuation change and settlements of derivatives from losses on foreign currency contracts used to manage foreign currency risk.

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