ALLSTATE CORP
For the period ended Dec 31, 2025. Filed Feb 20, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 20, 2026
ALL$254.81-4.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-24.
0000899051-25-000015
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsHighlightsProperty-LiabilityAllstate ProtectionRun-off Property-LiabilityProtection ServicesReserve for Property and Casualty Insurance Claims and Claims ExpenseAllstate Health and BenefitsInvestmentsMarket RiskCapital Resources and LiquidityEnterprise Risk and Return ManagementApplication of Critical Accounting EstimatesRegulation and Legal ProceedingsPending Accounting StandardsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-20.
0000899051-26-000031
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsHighlightsProperty-LiabilityAllstate ProtectionRun-off Property-LiabilityProtection ServicesReserve for Property and Casualty Insurance Claims and Claims ExpenseInvestmentsMarket RiskCapital Resources and LiquidityEnterprise Risk and Return ManagementApplication of Critical Accounting EstimatesRegulation and Legal ProceedingsPending Accounting StandardsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 597 previous paragraphs and 541 current paragraphs.
257 unchanged; 192 reworded; 57 added; 121 removed; 27 previous and 35 current paragraphs rearranged.
Tables are not compared: 72 previous and 61 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (57)
Current report
Further analysis of our insurance segments Allstate Protection and Run-off Property-Liability, together Property-Liability Operations, and Protection Services, is provided in MD&A. The segments are consistent with the way in which the chief operating decision maker reviews financial performance and makes decisions about the allocation of resources. The dispositions of the employer voluntary benefits (“EVB”) and group health businesses did not qualify for discontinued operations. The Allstate Health and Benefits segment is no longer a reportable segment, with results of this segment recast to reflect only the results of the EVB and group health businesses. The retained individual health business, previously included in the Allstate Health and Benefits segment, is a non-reportable segment with results included in all other for all periods presented.
Current report
Tariffs Beginning on April 2, 2025, the U.S. government announced additional tariffs on goods imported to the U.S. We regularly evaluate scenarios to understand the potential impact of tariffs on our businesses and incorporate estimates of the impact into our development of reserves for claims. The evolving and uncertain global trade environment makes it difficult to predict the full effect on our business and it may take time for the impact of inflation to become evident. The following factors may impact operations at levels beyond what we are currently observing:
Current report
•Higher new and used vehicle pricing and replacement parts, increasing claims costs in Allstate Protection and Dealer Services
Current report
•Increases in building material costs, driving increases in homeowners claim costs
Current report
•Lack of availability of replacement parts from disruption in global trade broadly impacting all businesses
Current report
•Fewer auto new issued applications due to lower new and used vehicle sales
Current report
•Reduced demand in Dealer Services due to lower new vehicle sales
Current report
•Lower premiums written from reduced U.S. retail sales in Protection Plans
Current report
•Adverse impacts on investment valuations and liquidity for market-based and performance-based investments
Current report
On April 1, 2025, we closed the sale of American Heritage Life Insurance Company and American Heritage Service Company, comprising our employer voluntary benefits business. We recorded a gain on the sale of $888 million or $641 million, after-tax for the year ended December 31, 2025.
Current report
On July 1, 2025, we closed the sale of Direct General Life Insurance Company, NSM Sales Corporation and The Association Benefits Solution, LLC, comprising the group health business. We recorded a gain on sale of $715 million or $499 million, after-tax for the year ended December 31, 2025.
Current report
See Note 4 of the consolidated financial statements for further information on the EVB and group health dispositions.
Current report
Consolidated net income applicable to common shareholders was $10.17 billion in 2025 compared to net income of $4.55 billion in 2024, primarily due to higher underwriting income and gains on dispositions.
Current report
For segment results, services provided by Protection Services to Allstate Protection are not eliminated as management considers those transactions in assessing the results of the respective segments. The effects of inter-segment transactions are eliminated in the consolidated results.
Current report
(1)Includes renters, condominium, landlord, boat, umbrella, manufactured home, scheduled personal property and valuable item protection products.
Current report
•PIF increased 2.3% or 568 thousand to 25,504 thousand as of December 31, 2025 compared to December 31, 2024
Current report
•In states where we are achieving acceptable returns, we will focus on implementing rates to keep pace with increasing costs and explore opportunities for rate investments towards growth
Current report
•PIF increased 2.5% or 186 thousand to 7,697 thousand as of December 31, 2025 compared to
Current report
December 31, 2024, primarily in the direct and exclusive agency channels, partially offset by a reduction in the independent agency channel
Current report
(2)Expense ratio includes profit-sharing commissions on lender-placed business, which increased in 2025 as losses declined and decreased in 2024 due to higher losses.
Current report
Other personal lines loss ratio decreased 8.5 points in 2025 compared to 2024, primarily due to increased premiums earned, partially offset by higher non-catastrophe losses.
Current report
Commercial lines loss ratio decreased 71.2 points in 2025 compared to 2024, primarily due to the benefit of
Current report
prior year reserve releases and lower losses, partially offset by a decrease in premiums earned driven by the strategic decision for the Allstate brand to stop writing new business and non-renew policies.
Current report
Other business lines loss ratio decreased 21.1 points in 2025 compared to 2024, primarily due to lower losses and the benefit of prior year non-catastrophe reserve releases.
Current report
Catastrophe losses decreased 0.1% or $5 million in 2025 compared to 2024.
Current report
(2)Gross losses before reinsurance recoverables and reinstatement premiums were $6.2 billion.
Current report
Severe convective storms We consider the areas of highest potential for catastrophic losses from wind, hail and tornado activity to be major metropolitan regions extending from the Great Plains through the Southeastern United States. We have mitigated our risk of severe convective storm loss by purchasing homeowners nationwide reinsurance coverage, utilized enhanced underwriting processes using aerial imagery, and have continued to provide options of coverage and price that are predicated on roof characteristics.
Current report
Adjusted net income increased 0.5% or $1 million in 2025 compared to 2024, primarily due to premium growth at Protection Plans, partially offset by increased claims and higher expenses at Arity.
Current report
PIF increased 3.3% or 5 million in 2025 compared to 2024 due to growth at Protection Plans.
Current report
Other revenue increased 10.9% or $48 million in 2025 compared to 2024, primarily driven by international growth at Protection Plans and higher lead generation revenue at Arity.
Current report
Reserve reestimates, which decreased reserves by $1.96 billion in 2025 and represented 22.6% of underwriting income, were primarily due to favorable severity development of $1.18 billion in personal auto injury coverage and $671 million in all other personal auto coverages.
Current report
(3)The increase of $523 million from $377 million at December 31, 2024 to $900 million at December 31, 2025, is primarily related to the January 2025 California wildfire event.
Current report
In 2025, ceded claims and claims expenses decreased primarily due to better than expected auto injury claim emergence related to MCCA, partially
Current report
offset by catastrophe reinsurance driven by the California wildfires. In 2024, ceded claims and claims expenses increased $1.08 billion primarily due to NFIP reserves related to Hurricane Helene and catastrophe reinsurance. For further discussion of these items, see Regulation section in Part I and Note 11 of the consolidated financial statements.
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Removed paragraphs (121)
Previous report
•Allstate Health and Benefits: premiums, other revenue, new business sales, PIF, benefit ratio, expenses and adjusted net income
Previous report
On August 13, 2024, we entered into a share purchase agreement with StanCorp Financial Group, Inc. to sell American Heritage Life Insurance Company and American Heritage Service Company, comprising our employer voluntary benefits business for approximately $2.0 billion in cash. The employer voluntary benefits business is reported in the Allstate Health and Benefits segment, and beginning in the third quarter of 2024, the assets and liabilities of the business were classified as held for sale. The transaction is expected to close in the first half of 2025, subject to regulatory approvals and other customary closing conditions.
Previous report
On January 30, 2025, Allstate entered into an agreement with Nationwide Life Insurance Company to sell Direct General Life Insurance Company, NSM Sales Corporation and The Association Benefits Solution, LLC, comprising the group health business for approximately $1.25 billion in cash, adjusted for the closing balance sheet. The group health business is reported in the Allstate Health and Benefits segment, and beginning in the first quarter of 2025, the assets
Previous report
The Allstate Corporation 35 and liabilities of the business will be classified as held for sale. The transaction is expected to close during 2025, subject to regulatory approvals and other customary closing conditions. The individual health business will either be retained or divested.
Previous report
The transaction prices less costs to sell exceeds the carrying value of the net assets of both transactions, resulting in an expected gain that will be recognized at closing of each transaction. The ultimate amount of the anticipated gain on the sales will be impacted by purchase price adjustments associated with certain pre-close transactions, changes in the carrying value of net assets, changes in accumulated other comprehensive income and the related tax effects.
Previous report
See Note 4 of the consolidated financial statements for further information on the employer voluntary benefits disposition.
Previous report
Allstate continued to focus on its operating priorities while successfully executing a comprehensive plan to improve auto insurance profitability and making substantial progress in advancing Transformative Growth. The table below summarizes the results of our 2024 Operating Priorities.
Previous report
(1)2025 operating priorities will remain mostly consistent with the 2024 priorities.
Previous report
Consolidated net income applicable to common shareholders was $4.55 billion in 2024 compared to net loss of $316 million in 2023, primarily due to improved underwriting results from increased earned premium and improved loss trends.For the twelve months ended December 31, 2024, return on average Allstate common shareholders’ equity was 25.8% compared to (2.0)% for the twelve months ended December 31, 2023.
Previous report
Allstate Protection underwriting income was $3.15 billion in 2024 compared to an underwriting loss of $2.09 billion in 2023, primarily due to increased premiums earned, favorable reserve reestimates and lower losses, partially offset by higher advertising costs.
Previous report
Premiums written increased 11.1% to $55.93 billion in 2024 compared to $50.35 billion in 2023, reflecting higher premiums in auto and homeowners insurance.
Previous report
Protection Services adjusted net income was $217 million in 2024 compared to $106 million in 2023. The increase in 2024 was due to premium growth at Allstate Protection Plans, improved claim severity at Allstate Roadside, higher lead sales revenue at Arity and both growth and lower costs at Allstate Identity Protection. Prior year adjusted net income was also negatively impacted by an increase in state income taxes for Allstate Dealer Services.
Previous report
Premiums and other revenues increased 15.7% or $401 million to $2.96 billion in 2024 from $2.56 billion in 2023 primarily due to Allstate Protection Plans.
Previous report
Allstate Health and Benefits adjusted net income was $186 million in 2024 compared to $242 million in 2023. The decrease was primarily due to increased benefit utilization across all lines of business.
Previous report
Premiums and contract charges totaled $1.92 billion in 2024, an increase of 4.1% from $1.85 billion in 2023, primarily due to growth in individual health and group health, partially offset by a decline in employer voluntary benefits.
Previous report
The effective tax rate is the ratio of income tax expense (benefit) divided by income (loss) from operations before income tax expense. For the year ended December 31, 2024, we reported an effective tax rate of 20.2% based on total income tax expense of $1.16 billion on total income from operations before income tax expense of $5.76 billion. The effective rate in 2024 is lower than the federal statutory rate of 21%, primarily due to tax benefits derived from tax credits, tax-exempt interest income, and share-based payments, offset by state income tax expense.
Previous report
For the year ended December 31, 2023, we reported an effective tax rate of 38.8% based on a total income tax benefit of $135 million on the loss from operations before income tax benefit of $348 million. The effective tax rate in 2023 was higher than the federal statutory rate of 21% due to the additional tax benefit derived from tax credits, tax-exempt interest income and shared-based payments, offset by a change in valuation allowance and uncertain tax positions.
Previous report
For additional information, see Note 17 of the consolidated financial statements.
Previous report
(1)Restructuring and related charges in 2024 primarily relate to the organizational transformation component of the Transformative Growth plan. See Note 15 of the consolidated financial statements for additional details.
Previous report
(1)Include renters, condominium, landlord and other personal lines products.
Previous report
•In 2024, we have removed underwriting restrictions in areas that represent the majority of Allstate brand countrywide premiums, which is expected to increase premiums written and PIF. In locations not achieving acceptable returns, we expect to
Previous report
continue to pursue targeted rate increases. In states where we are not achieving acceptable returns, we plan to implement rates that keep pace with increasing costs. See Note 9 for additional details on actions taken related to Adirondack Insurance Exchange and New Jersey Skylands Insurance Association
Previous report
•PIF decreased 1.4% or 347 thousand to 24,936 thousand as of December 31, 2024 compared to December 31, 2023
Previous report
Policy growth is being driven primarily by the Allstate brand and is geographically widespread. We
Previous report
National General policy growth may be negatively impacted as we improve underwriting margins to targeted levels through underwriting and rate actions. See Note 9 for additional details on actions taken related to Adirondack Insurance Exchange and New Jersey Skylands Insurance Association.
Previous report
condominium new business in California and Florida and we are non-renewing certain policies in Florida.
Previous report
(3)Includes anticipated return commissions on lender-placed business due to increased losses.
Previous report
•Value of total losses due to changes in used car prices
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Reworded paragraphs (192)
Previous wording
The measure of segment profit or loss used in evaluating performance is underwriting income for the Allstate Protection and Run-off Property-Liability segments and adjusted net income for the Protection Services, Allstate Health and Benefits, and Corporate and Other segments.
Current wording
The measure of segment profit or loss used in evaluating performance is underwriting income for the Allstate Protection and Run-off Property-Liability segments and adjusted net income for the Protection Services and Corporate segments. We use these measures in our evaluation of results of operations to analyze profitability.
Previous wording
Underwriting income (loss) is calculated as premiums earned and other revenue, less claims and claims expense (“losses”), amortization of deferred policy acquisition costs (“DAC”), operating costs and expenses, amortization or impairment of purchased intangibles, and restructuring and related charges, as determined using accounting principles generally accepted in the United States of America (“GAAP”). We
Current wording
Underwriting income (loss) is calculated as premiums earned and other revenue, less claims and claims expense (“losses”), amortization of deferred policy acquisition costs (“DAC”), operating costs and expenses, amortization or impairment of purchased intangibles, and restructuring and related charges, as determined using accounting principles generally accepted in the United States of America (“GAAP”).
Previous wording
Macroeconomic factors have and may continue to impact the results of our operations, financial condition and liquidity, such as U.S. government fiscal and monetary policies, conflict in the Middle East, the Russia/Ukraine conflict, supply chain disruptions, labor shortages and potential trade policy actions, such as tariffs and quotas. These factors should be considered when comparing the current period to prior periods. Macroeconomic impacts are disclosed in Part 1 “Item 1A. Risk Factors’’, including the risk factors titled “A large-scale pandemic, the occurrence of terrorism, military actions, political and social unrest or other disruptive or destabilizing events may have an adverse effect on our business” and “Conditions in the global economy and capital markets could adversely affect the business and results of operations”. This is not inclusive of all potential impacts and should not be treated as such. Within the MD&A, we have included further disclosures related to macroeconomic impacts on our 2024 results.
Current wording
Macroeconomic factors have and may continue to impact the results of our operations, financial condition and liquidity, such as U.S. government fiscal and monetary policies, the Russia/Ukraine conflict, supply chain disruptions and labor shortages. These factors should be considered when comparing the current period to prior periods. Macroeconomic impacts are disclosed in Part 1 “Item 1A. Risk Factors’’, including the risk factors titled “Widespread disruptive or destabilizing events may have an adverse effect on our business” and “Conditions in the global economy and capital markets could adversely affect the business and results of operations”.
Previous wording
Total revenue increased 12.3% to $64.11 billion in 2024 compared to 2023, primarily due to premium rate increases and higher net investment income.
Current wording
Total revenue increased 5.6% to $67.69 billion in 2025 compared to 2024, primarily due to higher auto and homeowners insurance policies in force and premium rate increases.
Previous wording
Net investment income increased $614 million to $3.09 billion in 2024 compared to 2023, primarily due to higher market-based investment results. Market-based results continue to benefit from portfolio repositioning into higher yielding fixed income securities and higher investment balances.
Current wording
Net investment income increased $357 million to $3.45 billion in 2025 compared to 2024, primarily due to higher market-based and performance-based investment results.
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Investments totaled $72.61 billion as of December 31, 2024, increasing from $66.68 billion as of December 31, 2023.
Current wording
Investments totaled $83.24 billion as of December 31, 2025, increasing from $72.61 billion as of December 31, 2024.
Previous wording
Allstate shareholders’ equity was $21.44 billion as of December 31, 2024 and $17.77 billion as of December 31, 2023. The increase is primarily due to net income, partially offset by dividends to shareholders.
Current wording
Allstate shareholders’ equity was $30.61 billion as of December 31, 2025 and $21.44 billion as of December 31, 2024. The increase is primarily due to net income and an increase in unrealized net capital gains on investments in 2025, partially offset by common share repurchases and dividends to shareholders.
Previous wording
Book value per diluted common share (ratio of Allstate common shareholders’ equity to total common shares outstanding and dilutive potential common shares outstanding) was $72.35 as of December 31, 2024, an increase of 21.8% from $59.39 as of December 31, 2023.
Current wording
Book value per diluted common share (ratio of Allstate common shareholders’ equity to total common shares outstanding and dilutive potential common shares outstanding) was $108.45 as of December 31, 2025, an increase of 49.9% from $72.35 as of December 31, 2024.
Previous wording
Return on average Allstate common shareholders’ equity For the twelve months ended December 31, 2024, return on Allstate common shareholders’ equity was 25.8%, an increase of 27.8 points from (2.0)% for the twelve months ended December 31, 2023, primarily due to net income applicable to common shareholders.
Current wording
Return on average Allstate common shareholders’ equityfor the twelve months ended December 31, 2025, was 42.3%, an increase of 16.5 points from 25.8% for the twelve months ended December 31, 2024.
Previous wording
•PIF: policy counts are based on items rather than customers. A multi-car customer would generate multiple item (policy) counts, even if all cars were insured under one policy. Lender-placed policies are excluded from policy counts because relationships are with the lenders.
Current wording
•PIF: policy counts are based on items rather than customers. A multi-car customer would generate multiple item (policy) counts, even if all cars were insured under one policy. Lender-placed policies are excluded from policy counts.
Previous wording
•Average premium-gross written (“average premium”): gross premiums written divided by issued item count. Gross premiums written include the impacts from discounts, surcharges and ceded reinsurance premiums and exclude the impacts from mid-term premium adjustments and premium refund accruals. Average premiums represent the appropriate policy term for each line.
Current wording
•Average premium-gross written (“average premium”): gross premiums written divided by issued item count. Gross premiums written include the impacts from discounts, surcharges and ceded reinsurance premiums and exclude the impacts from mid-term premium adjustments and premium refund accruals. Average premiums represent the appropriate policy term for each line, typically six months for an auto policy and twelve months for a homeowners policy.
Previous wording
Underwriting income was $3.15 billion in 2024 compared to underwriting loss of $2.09 billion in 2023, primarily due to increased premiums earned, favorable reserve reestimates and lower losses, partially offset by higher advertising costs.
Current wording
Underwriting income was $8.69 billion in 2025 compared to $3.15 billion in 2024, primarily due to increased premiums earned and the benefit of prior year reserve releases, partially offset by higher expenses.
Previous wording
(2)Other business lines represents commissions earned and other costs and expenses for Ivantage, non-proprietary life and annuity products, and lender-placed products.
Current wording
(2)Other business lines represents commissions earned from brokered property and casualty and life and annuity products, and lender-placed products.
Previous wording
Premium measures and statistics include PIF, new issued applications and average premiums to analyze our premium trends. Premiums written is the amount of premiums charged for policies issued during a fiscal period. Premiums are considered earned and are included in the financial results on a pro-rata basis over the policy period. The portion of premiums written applicable to the unexpired term of the policies is recorded as unearned premiums on our Consolidated Statements of Financial Position.
Current wording
Premium measures and statistics include PIF, new issued applications and average premiums. Premiums written is the amount of premiums charged for policies issued during a fiscal period. Premiums are considered earned and are included in the financial results on a pro-rata basis over the policy period. The portion of premiums written applicable to the unexpired term of the policies is recorded as unearned premiums on the Consolidated Statements of Financial Position.
Previous wording
Auto insurance premiums written increased 9.8% or $3.34 billion in 2024 compared to 2023, primarily due to the following factors:
Current wording
Auto insurance premiums written increased 3.6% or $1.35 billion in 2025 compared to 2024, primarily due to the following factors:
Previous wording
•Increased average premiums driven by rate increases. In 2024, rate increases of 10.4% were implemented in 55 locations, resulting in total insurance premium impact of 7.5%
Current wording
•Rate increases that moderated from the prior year. In 2025, rate increases of 3.5% were implemented resulting in a total insurance premium impact of 2.6%
Previous wording
Homeowners insurance premiums written increased 14.6% or $1.83 billion in 2024 compared to 2023, primarily due to the following factors:
Current wording
Homeowners insurance premiums written increased 14.9% or $2.15 billion in 2025 compared to 2024, primarily due to the following factors:
Previous wording
•Higher Allstate brand average premiums from implemented rate increases, combined with policies in force growth
Current wording
•Higher Allstate brand average premiums resulting from rate increases and inflation in insured home replacement costs, combined with policies in force growth
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•In 2024 rate increases of 14.5% were implemented in 53 locations, resulting in total insurance premium impact of 11.0%
Current wording
•In 2025, rate increases of 7.6% were implemented resulting in a total estimated insurance premium impact of 5.1%, excluding the impact of changes in insured home replacement costs
Previous wording
are not writing new homeowners business in California and Florida and we did not write new homeowners business in New Jersey in 2024. We are also non-renewing certain policies in Florida. We may not be able to grow in certain states without regulatory or legislative reforms that enable customers to be provided coverage at appropriate risk adjusted returns.
Current wording
In Florida, we are not writing new homeowners business and are substantially complete with the non-renewal of certain policies. We may not be able to grow in certain states without regulatory or legislative reforms that enable customers to be provided coverage at appropriate risk adjusted returns.
Previous wording
Other personal lines premiums written increased 21.8% or $549 million in 2024 compared to 2023, primarily due to involuntary auto policies purchased from other carriers by National General and Allstate brand landlords policies. We are not writing
Current wording
Other personal lines premiums written increased 6.4% or $197 million in 2025 compared to 2024, primarily due to increases in landlords and personal umbrella policies, partially offset by a decrease in auto assigned risk policies purchased from other carriers. We are not writing new condominium business in Florida.
Previous wording
Commercial lines premiums written decreased 31.3% or $225 million in 2024 compared to 2023, due to the strategic decision for the Allstate brand to stop
Current wording
Commercial lines premiums written decreased 18.8% or $93 million in 2025 compared to 2024, due to the strategic decision for the Allstate brand to stop writing new business and non-renew certain policies. We are offering comprehensive commercial products,
Previous wording
The Allstate Corporation 43 writing new business and non-renew certain policies. We are committed to offering comprehensive commercial products to customers through our exclusive agency, independent agency and direct channels, with solutions offered by the National General brand, NEXT Insurance and other brokered solutions.
Current wording
including brokered solutions, to customers through our exclusive agency, independent agency and direct channels.
Previous wording
Other business lines premiums written increased 15.0% or $85 million in 2024 compared to 2023 due to growth in the lender-placed business.
Current wording
Other business lines premiums written increased 2.2% or $14 million in 2025 compared to 2024, due to growth in the lender-placed homeowners business, partially offset by lower lender-placed auto premiums.
Previous wording
(1)Expense ratio includes other revenue of $223 million, $57 million, and $19 million in 2024, 2023 and 2022, respectively, for fees on involuntary auto policies.
Current wording
(1)Expense ratio includes other revenue of $185 million, $223 million and $57 million in 2025, 2024 and 2023, respectively, for fees on auto assigned risk policies.
Previous wording
Auto loss ratio decreased 10.1 points in 2024 compared to 2023 driven by increased earned premiums and lower non-catastrophe losses compared to the prior year. Estimated report year 2024 incurred claim severity for Allstate increased compared to report year 2023 for major coverages due to higher repair costs, a higher mix of total losses, an increase in claims with attorney representation, higher medical consumption, and inflation. Gross claim frequency decreased relative to the prior year. We continue to enhance our claims practices to manage loss costs by increasing resources and expanding re-inspections, accelerating resolution of bodily injury claims, and negotiating improved vendor services and parts agreements.
Current wording
Auto loss ratio decreased 9.3 points in 2025 compared to 2024 driven by increased earned premiums, lower claim frequency and the benefit of prior year non-catastrophe reserve releases. Estimated report year 2025 incurred claim severity for Allstate brand increased compared to report year 2024 for major coverages due to higher repair costs, mix of total loss frequency, medical consumption and attorney representation. We continue to enhance our claims practices to manage loss costs by increasing resources and expanding re-inspections and accelerating resolution of bodily injury claims.
Previous wording
Gross claim frequency decreased in 2024 compared to 2023 primarily due to fewer claims reported related to water and fire perils. Paid claim severity increased in 2024 compared to 2023 due to inflationary loss cost pressure driven by increases in labor and materials costs. Homeowner paid claim severity can be impacted by both the mix of perils and the magnitude of specific losses paid during the period.
Current wording
Homeowners loss ratio decreased 5.3 points in 2025 compared to 2024, primarily due to increased premiums earned. Gross claim frequency, excluding catastrophes, decreased in 2025 compared to 2024 while paid claim severity, excluding catastrophes, increased due to a mix of fire and wind/hail perils. Homeowner paid claim severity can be impacted by both the mix of perils and the magnitude of specific losses paid during the period.
Previous wording
Historical catastrophe experience For the last ten years, the average annual impact of catastrophes on our loss ratio was 8.6 points, but it has varied from 5.7 points to 11.6 points. The impact of catastrophes on the homeowners loss ratio in 2024 was 27.8 points compared to the average annual impact for the last ten years of 27.6 points. Over time, we have limited our aggregate insurance exposure to catastrophe losses in certain regions of the country that are subject to high levels of natural catastrophes by our participation in various state facilities. For further discussion of these facilities, see Note 16 of the consolidated financial statements. However, the impact of these actions may
Current wording
Historical catastrophe experience For the last ten years, the average annual impact of catastrophes on our loss ratio was 8.8 points, but it has varied from 7.1 points to 11.6 points. The impact of homeowners catastrophes on the homeowners loss ratio in 2025 was 26.6 points compared to the average annual impact for the last ten years of 28.1 points. Over time, we have limited our aggregate insurance exposure to catastrophe losses in certain regions of the country that are subject to high levels of natural catastrophes by our participation in various state facilities. For further discussion of these facilities, see Note 14 of the consolidated financial statements. However, the impact of these actions may be diminished by the growth in insured values, the effect of state insurance laws and regulations and we may not be able to maintain our current level of reinsurance or purchase new reinsurance protection in amounts we consider sufficient at acceptable prices. In addition, in various states we are required to participate in assigned risk plans, reinsurance facilities and joint underwriting associations that provide insurance coverage to individuals or entities that otherwise are unable to purchase such coverage from private insurers including the California FAIR Plan Association. Because of our participation in these and other state facilities such as wind pools, we may be exposed to losses that surpass the capitalization of these facilities and to assessments from these facilities.
Previous wording
–Reduced our exposure to high-risk areas, including California and Florida. We have decreased our overall homeowner exposure in California by more than 50% since 2007. Additionally, from 2016 to 2022 we wrote a limited number of homeowners policies in select areas of California. In 2022 we stopped writing new homeowners and condominium business in the states of California and Florida. As a result, since December 31, 2023, PIF has declined by approximately 5.0% and 21% in California and Florida, respectively.
Current wording
limited number of homeowners policies in select areas of California. We stopped writing new homeowners and condominium business in California in 2022. In Florida, we stopped writing new condominium business in 2022 and new homeowners business in 2023. As a result, since December 31, 2024, PIF has declined by approximately 5% and 15% in California and Florida, respectively.
Previous wording
–Write homeowners coverage, excluding in Florida, through our excess and surplus lines carrier, North Light Specialty Insurance Company (“North Light”), which can include earthquake coverage (other than fire following earthquakes) that is currently ceded via quota share reinsurance.
Current wording
–Continue to write homeowners coverage, excluding in Florida, through our excess and surplus lines carrier, North Light Specialty Insurance Company (“North Light”), for properties with a higher risk of catastrophes or where customers do not meet certain criteria. These policies can include earthquake coverage (other than fire following earthquakes) that is currently ceded via quota share reinsurance.
Previous wording
•Increased capacity in our brokerage platform for customers not offered an Allstate policy. As of December 31, 2024, Ivantage had $2.57 billion non-proprietary premiums under management.
Current wording
•Increased capacity in our brokerage platform for customers not offered an Allstate policy. As of December 31, 2025, Ivantage had $2.86 billion non-proprietary premiums under management.
Previous wording
•Include coverage for flood-related losses for auto comprehensive damage coverage since we have additional catastrophe exposure, beyond the property lines, for auto customers who have purchased comprehensive damage coverage.
Current wording
•Include coverage for flood-related auto comprehensive losses within our reinsurance program to reduce the additional catastrophe exposure, beyond the property lines, for auto customers who have purchased comprehensive damage coverage.
Previous wording
•Provide options of coverage for roof damage, including graduated coverage and pricing based on roof type and age. In 2024, premiums written totaled $8.75 billion or 60.7% of homeowners premiums written.
Current wording
•Provide options of coverage for roof damage, including graduated coverage and pricing based on roof type and age.
Previous wording
Hurricanes We consider the greatest areas of potential catastrophe losses due to hurricanes to be major metropolitan centers along the eastern and gulf coasts of the United States. The average premium on a property policy near these coasts is generally greater than in other areas. However, average premiums are often not considered commensurate with the inherent risk of loss. In addition, as explained in Note 16 of the consolidated financial statements, in various states Allstate is subject to assessments from assigned risk plans, reinsurance facilities and joint underwriting
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The Allstate Corporation 43 property policy near these coasts is generally greater than in other areas. However, average premiums are often not considered commensurate with the inherent risk of loss. In addition, as explained in Note 14 of the consolidated financial statements, in various states Allstate is subject to assessments from assigned risk plans, reinsurance facilities and joint underwriting associations providing insurance for wind related property losses.
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Earthquakes We do not offer earthquake coverage in most states. We retain approximately 23,000 PIF with earthquake coverage, with the largest number of policies located in Kentucky, due to regulatory and other reasons. We purchase reinsurance in Kentucky and enter into arrangements in many states to make earthquake coverage available through our brokerage platform.
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Earthquakes We do not offer earthquake coverage in most states. We retain approximately 19,000 PIF with earthquake coverage, with the largest number of policies located in Kentucky, due to regulatory and other reasons. We purchase reinsurance in Kentucky and enter into arrangements in many states to make earthquake coverage available through our brokerage platform.
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Fires following earthquakes Under a standard homeowners policy we cover fire losses, including those caused by an earthquake. Actions taken related to our risk of loss from fires following earthquakes include restrictive underwriting guidelines in California for new business writings, purchasing reinsurance for Kentucky personal lines property risks, and purchasing nationwide occurrence reinsurance, excluding Florida.
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Fires following earthquakes Under a standard homeowners policy we cover fire losses, including those caused by an earthquake. Actions taken related to our risk of loss from fires following earthquakes include restrictive underwriting guidelines in California for new business writings, purchasing reinsurance for Kentucky personal lines property risks, and purchasing nationwide reinsurance coverage, excluding Florida.
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Wildfires Actions taken related to managing our risk of loss from wildfires include purchasing nationwide occurrence reinsurance, new and renewal inspection programs to identify and remediate wildfire risk as well as leveraging contemporary underwriting tools in select areas. While these programs are designed to mitigate risk, the exposure to wildfires still exists. We continue to manage our exposure and seek appropriate returns for the risks we write. In addition, as explained in Note 16 of the consolidated financial statements, Allstate is subject to assessments from
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Wildfires Actions taken related to managing our risk of loss from wildfires include purchasing nationwide occurrence reinsurance, new and renewal inspection programs to identify and remediate wildfire risk as well as leveraging underwriting criteria. While these programs are designed to mitigate risk, the exposure to wildfires still exists. We continue to manage our exposure and seek appropriate returns. In addition, as explained in Note 14 of the consolidated financial statements, Allstate is subject to assessments from the California FAIR Plan Association providing insurance for property losses.
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reinstatement premiums, during 2024 was $1.11 billion compared to $1.02 billion during 2023. Catastrophe placement premiums reduce net written and earned premium with approximately 80% of the reduction related to homeowners premium. A description of our current catastrophe reinsurance program appears in Note 12 of the consolidated financial statements.
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Catastrophe reinsurance The total cost of our property catastrophe reinsurance programs, excluding reinstatement premiums, during 2025 was $1.23 billion compared to $1.11 billion during 2024. Catastrophe placement premiums reduce net written and earned premium with approximately 83% of the reduction related to homeowners premium. A description of our current catastrophe reinsurance program appears in Note 11 of the consolidated financial statements.
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Expense ratio increased 0.7 points in 2024 compared to 2023, primarily due to an increase in advertising costs, partially offset by higher earned premium growth relative to fixed costs.
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Expense ratio decreased 0.3 points in 2025 compared to 2024, primarily due to higher earned premium growth relative to costs, partially offset by an increase in advertising costs.
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Deferred acquisition costs We establish a DAC asset for costs that are related directly to the acquisition of new or renewal insurance policies, principally agent remuneration and premium taxes. DAC is amortized to income over the period in which premiums are earned.
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Deferred acquisition costs We establish a DAC asset for costs that are related directly to the acquisition of new or renewal insurance policies, principally agent, employee and broker remuneration, and premium taxes. DAC is amortized to income over the period in which premiums are earned.
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This is not inclusive of all potential impacts and should not be treated as such.
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–Reduced our exposure to high-risk areas, including California and Florida. We have decreased our overall homeowner exposure in California by more than 50% since 2007. Additionally, from 2016 to 2022 we wrote a
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Hurricanes We consider the greatest areas of potential catastrophe losses due to hurricanes to be major metropolitan centers along the eastern and gulf coasts of the United States. The average premium on a
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54 www.allstate.com causes reinsurance risk across the industry to be concentrated among fewer companies.
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ABS and MBS are structured securities that are primarily collateralized by consumer or corporate
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portfolio, see Note 6 of the consolidated financial statements.
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In August 2025, A.M. Best affirmed the insurance financial strength ratings of A- for the members of Allstate New Jersey Group (Allstate New Jersey
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expenses, including liabilities for collateral and operating leases.
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As of December 31, 2025, we held $31.31 billion of cash, U.S. government and agencies fixed income securities, public equity securities and short-term investments, which we would expect to be able to
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The payment of dividends by AIC to the Corporation is limited by Illinois insurance law to formula amounts based on statutory net income and statutory surplus, as well as the timing and amount of dividends paid in the preceding twelve months. The maximum amount of dividends that AIC will be able to pay, without prior Illinois Department of Insurance approval, at a given point in time in 2026, based on the
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The Allstate Corporation 71 amount that can be borrowed under the credit facility.
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•We ensure a strong foundation by maintaining capital strength, solvency and liquidity, complying with laws, acting with integrity and protecting customers and proprietary information, assets and technology.
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•We build strategic value by continually investing in our strategic position, creating flexibility to adapt our business model in a changing world and differentiating through innovation.
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•We optimize risk and return through profitable growth, valuing customer relationships in operating and strategic decisions and developing new business offerings and investment opportunities while managing risk concentrations.
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structure and risk-related decision-making, while focusing on the Company’s aggregate risk profile.
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•The Enterprise Risk and Return Council (“ERRC”) directs ERRM activities by establishing risk and return targets, monitoring and targeting capital levels and overseeing integrated strategies and
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Investment risk and return management encompasses risks and opportunities associated with
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2025 Form 10-KEnterprise Risk and Return Management
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Some reporting units comprise both legacy and acquired businesses, resulting in substantial internally generated and unrecognized intangibles and fair values that significantly exceed their carrying values.
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•Stock price and market capitalization analysis take into consideration the quoted market price of our outstanding common stock and includes a control premium, derived from relevant historical acquisition activity, in determining the estimated fair value of the consolidated entity before allocating that fair value to individual reporting units.
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•Discounted cash flow analysis utilizes long term assumptions for revenues, investment income, benefits, claims, other operating expenses and income taxes to produce projections of both income and cash flows available for dividends that are present valued using the weighted average cost of capital.
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•Market to book multiples represent the mean market to book multiple for selected peer companies with operations similar to each goodwill reporting unit to which the multiple is applied.
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The outputs from these methods are weighted based on the nature of the business and the relative amount of market observable assumptions supporting the estimates. The computed values are then weighted to reflect the fair value estimate based on the specific attributes of each goodwill reporting unit.
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Underwriting results are significantly influenced by estimates of property and casualty insurance claims and claims expense reserves.
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How reserve estimates are established and updated Reserve estimates are developed at a detailed level, and the results are aggregated to form a consolidated reserve estimate. The detailed estimates include each line of insurance, major components of
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As loss experience for the current year develops for each type of loss, it is monitored relative to initial
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The Allstate Corporation 79 of the accident year, 20% in the second year, 10% in the third year, 10% in the fourth year, and the remaining 10% thereafter.
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For example, to complete estimates for certain
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Characteristics of Run-off exposure Our exposure to asbestos, environmental and other run-off claims arise principally from assumed reinsurance coverage written from the 1960s through the mid-1980s, including reinsurance on primary insurance written on large U.S. companies, and from direct excess commercial insurance written from 1972 through 1985, including substantial excess general liability coverages on large U.S. companies. Additional exposure stems
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How reserve estimates are established and updated We conduct an annual review in the third quarter to evaluate, establish and adjust as necessary, asbestos, environmental and other run-off claims reserves. Changes to reserves are recorded in the reporting period in which they are determined. Using established industry and actuarial best practices and assuming no change in the regulatory or economic
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timing of any contractual liability; the impact of bankruptcy protection sought by various asbestos producers and other asbestos defendants; and other uncertainties.
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82 www.allstate.com could result in additional changes to the Consolidated Statements of Operations.
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Net costs for our defined benefit plans are recognized on the Consolidated Statements of
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return on plan assets, partially offset by a decrease in the liability discount rate and changes in actuarial assumptions. Remeasurement gains in 2024 primarily related to an increase in the liability discount rate and
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The Allstate Corporation 83 changes in other assumptions, partially offset by unfavorable asset performance compared to expected return on plan assets.
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use this measure in our evaluation of results of operations to analyze profitability.
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Consolidated net income (loss) applicable to common shareholders
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(2)Favorable reserve reestimates are shown in parentheses.
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•Supply chain disruptions and labor shortages
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be diminished by the growth in insured values, the effect of state insurance laws and regulations and we may not be able to maintain our current level of reinsurance or purchase new reinsurance protection in amounts we consider sufficient at acceptable prices. In addition, in various states we are required to participate in assigned risk plans, reinsurance facilities and joint underwriting associations that provide insurance coverage to individuals or entities that otherwise are unable to purchase such coverage from private insurers including the California FAIR Plan Association. Because of our participation in these and other state facilities such as wind pools, we may be
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The Allstate Corporation 45 exposed to losses that surpass the capitalization of these facilities and to assessments from these facilities.
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associations providing insurance for wind related property losses.
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Catastrophe reinsurance The total cost of our property catastrophe reinsurance programs, excluding
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The Allstate Health and Benefits portfolio is focused on protection of principal and consistent income generation within a total return framework. The portfolio is largely comprised of fixed income securities with a small allocation to short-term investments.
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The Allstate Corporation 65 security issued by the trust, typically referred to as a “class”, qualifies for a specific original rating.
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Jersey). The outlook for the rating is negative. ANJ writes auto and homeowners insurance in New Jersey, which has a financial strength rating of A’ from Demotech, that was affirmed in December 2024.
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Short-term contractual obligationsare typically settled with cash or short-term investments and
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intercompany agreements in place that facilitate liquidity management across the Company to enhance flexibility.
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•The Corporation and AIC have access to a $750 million unsecured revolving credit facility that is available for short-term liquidity requirements. The maturity date of this facility is November 2027. The facility is fully subscribed among 11 lenders with the largest commitment being $95 million. The commitments of the lenders are several and
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expectation of future payment patterns. The ultimate cost of losses may vary materially from recorded amounts that are our best estimates. See Note 10 of the consolidated financial statements and Application of Critical Accounting Estimates section of the MD&A for further information.
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Insurance risk and return management encompasses risks and opportunities associated with Allstate’s insurance activities, including expected trends and unanticipated fluctuations in premiums,
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2024 Form 10-K Enterprise Risk and Return Management
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For each fixed income security in an unrealized loss position, we assess whether management with the
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treatment trends, attorney representation and litigation costs while physical damage claims are affected largely by auto repair cost inflation, used car prices, length of claim resolution and the timing of receipt of third-party carrier claims.
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The Allstate Corporation 85 reserve estimate that will most accurately reflect the expected impacts on severity development.
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To develop a statistical measure of potential reserve variability, an actuarial technique (stochastic modeling) is applied to the countrywide data for paid losses combined with case reserves for each of auto liability, auto physical damage, and homeowners insurance excluding catastrophes. Based on the combined historical variability of the development
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The process employed to estimate MCCA covered losses involves a number of activities including the comprehensive review and interpretation of MCCA actuarial reports, other MCCA members’ reports and our PIP loss trends which have increased in severity over time. A significant portion of incurred claim reserves can be attributed to a small number of catastrophic claims and thus a large portion of the recoverable is similarly concentrated. We conduct comprehensive claim file reviews to develop case
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Reserve estimates are confidential and proprietary and by their nature are very complex to determine and subject to significant judgments. Reserve estimates do not represent an exact determination for each outstanding claim. Claims may be subject to litigation. As actual claims, paid losses and case reserve results emerge, our estimate of the ultimate cost to settle may be materially greater or less than previously estimated amounts.
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The Allstate Corporation 87 liability coverage and annual aggregate limits for all coverages. Our experience to date is that these policy form changes have limited the extent of our exposure to environmental and asbestos claim risks.
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After evaluating our insureds’ probable liabilities for asbestos, environmental and other run-off claims, we evaluate our insureds’ coverage programs for such
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Our reserves for asbestos, environmental and other run-off exposures could be affected by tort
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factors that might cause future expectations to differ from past trends. Approximately 90% of our benefit obligation relates to our U.S. qualified defined benefit pension plan.