Allstate Enhances Customer Value, Lowers Prices for 7.8 Million Customers in 2025

"Total policies in force increased to 210.9 million in the fourth quarter, up 3.0% from the prior year, driven by broad distribution and affordable, simple, connected products. Revenues increased to $17.3 billion in the fourth quarter and $67.7 billion for the full year. Full-year net income was $10.2 billion and adjusted net income* was $9.3 billion. Reflecting this success, the common dividend will increase to $1.08 per share to be paid in the second quarter and a $4.0 billion share repurchase program will be initiated when the existing $1.5 billion program is completed," concluded Wilson.

Fourth Quarter 2025 Results

• Total revenues of $17.3 billion in the fourth quarter of 2025 were $839 million or 5.1% higher than the prior year quarter.
• Net income applicable to common shareholders was $3.8 billion in the fourth quarter of 2025, compared to $1.9 billion in the prior year quarter, reflecting strong operating results.
• Adjusted net income* was $3.8 billion, or $14.31 per diluted share, compared to $2.1 billion in the prior year quarter.

Full Year 2025 Results

• Total revenues were $67.7 billion, 5.6% above the prior year.
• Net income applicable to common shareholders was $10.2 billion compared to $4.6 billion in 2024.
• Adjusted net income* was $9.3 billion generating an adjusted net income return on equity* of 38.3%.

• Property-Liability earned premiums of $14.8 billion increased 6.1% in the fourth quarter of 2025 compared to the prior year, primarily driven by higher average premiums and policy in force growth. Underwriting income was $4.0 billion compared to $1.8 billion in the prior year quarter.

• Premiums written increased 5.9% compared to the prior year quarter, reflecting higher auto and homeowners insurance average premiums and policies in force.
  
  
• Property-Liability combined ratio was 72.9 for the quarter, which was an improvement of 14.0 points versus the prior year quarter due to higher average earned premiums, the benefit of non-catastrophe reserve releases and lower catastrophe losses.
  
  
• Policies in force increased by 2.0%, led by growth in auto and homeowners insurance policies.
  
  
• Allstate-branded Affordable, Simple, Connected auto insurance products are now available in 43 states with the homeowners insurance product available in 31 states. Custom360^® middle market standard and preferred auto and homeowners insurance products for the independent agent channel are available in 36 states.
  
  
• Allstate Protection auto insurance results benefited from the Transformative Growth initiative, delivering strong margins and higher new business levels than the prior year.

• Written and earned premiums grew 3.1% and 2.9%, respectively, compared to the prior year quarter. Auto insurance rate increases resulted in an annualized premium impact of 0.2% in the fourth quarter and 2.6% in 2025.
  
  
• The recorded auto insurance combined ratio of 80.8 in the fourth quarter of 2025 was a 12.7 point improvement from the prior year quarter, reflecting higher average earned premiums, moderating loss costs and the benefit of non-catastrophe reserve releases. Prior year non-catastrophe reserve reestimates were $719 million in the fourth quarter, a 7.5 point benefit to the combined ratio, reflecting favorable severity development in personal auto injury and physical damage coverages.
  
  
• The underlying auto insurance combined ratio* of 87.6 in the fourth quarter of 2025 was a 5.4 point improvement from the prior year quarter, as growth in average earned premiums exceeded improving underlying loss and expense trends per policy. The fourth quarter underlying auto insurance combined ratio* would have been 90.4 when adjusted for 2.8 points of favorable development on claims reported in the first three quarters of 2025.
  
  
• Auto insurance policies in force grew by 2.3% with a 22.8% increase in new business reflecting expanded distribution, increased marketing, new products and sophisticated rating plans. Active brand auto insurance policies grew by 3.3%, which was partially offset by decreases in legacy Esurance and Encompass policies.
  
  
• Allstate Protection homeowners insurance remains a competitive advantage for Allstate and a growth opportunity. Underwriting profit of $1.8 billion increased from $1.1 billion in the prior year quarter, reflecting lower catastrophes and excellent underlying margins.

• Written premiums and earned premiums increased by 13.4% and 14.3% compared to the prior year quarter, respectively, due to higher average premiums and policy in force growth. A 7.4% increase in Allstate brand homeowners insurance average gross written premium compared to the prior year quarter reflects continued rate increases and higher home replacement costs.
  
  
• The recorded homeowners insurance combined ratio of 55.3 was 14.5 points below the fourth quarter of 2024, due to higher average earned premiums, lower catastrophe losses and lower underlying losses.
  
  
• Catastrophe losses of $170 million in the quarter decreased $145 million compared to the prior year quarter due to fewer and less severe events, as well as the absence of any hurricanes and tropical storms.
  
  
• The underlying combined ratio* of 51.4 improved by 8.1 points compared to the prior year quarter, primarily driven by higher average premiums and favorable non-catastrophe loss trends.
  
  
• Policies in force increased 2.5% compared to the prior year quarter, primarily driven by 3.2% growth in Allstate brand homeowners insurance policies, offset by a reduction in National General legacy products.
  
  
• Protection Services protects customers through five businesses where Allstate branded offerings are embedded in other offerings. Revenues increased to $917 million in the fourth quarter of 2025, 3.1% higher than the prior year quarter, primarily due to Protection Plans and Roadside. Adjusted net income of $57 million increased by $7 million compared to the prior year quarter.

• Protection Plans continued to expand distribution relationships and product offerings. Revenue of $609 million increased $81 million, or 15.3%, compared to the prior year quarter primarily due to strong international growth. Adjusted net income of $49 million in the fourth quarter of 2025 was $12 million higher than the prior year quarter.
  
  
• Dealer Services generated revenue of $148 million, an increase of $1 million compared to the prior year quarter. Adjusted net income of $7 million was $3 million higher than the prior year quarter.
  
  
• Roadside revenue of $61 million in the fourth quarter of 2025 increased 13.0% compared to the prior year quarter reflecting increased bundling with Allstate branded Affordable, Simple, Connected auto insurance products and higher third-party sales. Adjusted net income of $12 million in the fourth quarter was $2 million higher than the prior year quarter.
  
  
• Arity revenue of $60 million decreased $61 million compared to prior year quarter due to lower lead generation revenue. Adjusted net loss of $12 million in the fourth quarter of 2025 compared to a loss of $3 million in the prior year quarter.
  
  
• Identity Protection revenue of $39 million in the fourth quarter of 2025 was flat compared to the prior year quarter. Adjusted net income of $1 million in the fourth quarter of 2025 decreased compared to $2 million in the prior year quarter.
  
  
• Allstate Investments uses a proactive approach to balancing risk and return for the $83.2 billion portfolio. Net investment income of $892 million in the fourth quarter of 2025 increased by $59 million from the prior year quarter primarily due to market-based portfolio growth.

• Market-based investment income was $804 million in the fourth quarter of 2025, an increase of $77 million, or 10.6%, compared to the prior year quarter, reflecting growth in the asset balances to $73.4 billion in the market-based portfolio.
  
  
• Performance-based investment income totaled $146 million in the fourth quarter of 2025, a decrease of $21 million compared to the prior year quarter due to lower private equity and real estate returns. The overall portfolio allocation to performance-based assets provides a diversifying source of higher long-term returns; quarterly volatility in reported results is expected.
  
  
• Net gains on investments and derivatives were $73 million in the fourth quarter of 2025, compared to losses of $201 million in the prior year quarter. Fourth quarter results were driven by fixed income sales and higher valuation on equity investments.
  
  
• Unrealized net capital gains totaled $382 million (pre-tax), a $70 million decrease to the prior quarter as previously unrealized gains were recognized through sales of fixed income securities during the quarter.
  
  
• Total return on the investment portfolio was 1.1% for the fourth quarter and 5.8% for the full year 2025.
  
  
• Macroeconomic impacts are regularly monitored through our integrated Enterprise Risk and Return Management framework. In the fourth quarter of 2025, growth exposure increased through a higher allocation to public equity securities.

Proactive Capital Management

"Fourth‑quarter operating results generated an attractive adjusted net income return on equity and additional deployable capital," said John Dugenske, Interim Chief Financial Officer and President, Investments and Corporate Strategy. "Total estimated statutory surplus increased to $23.0 billion, and the holding company ended the year with $7.5 billion of assets. Over $2.2 billion was returned to shareholders in 2025, through a combination of share repurchases and common shareholder dividends. The common shareholder dividend will increase to $1.08, payable on April 1, 2026, to stockholders of record at the close of business on March 2, 2026. In addition, a $4.0 billion share repurchase program, over 24 months, will commence once the existing $1.5 billion program has been fully executed," concluded Dugenske.

Visit www.allstateinvestors.com for additional information about Allstate's results, including a webcast of its quarterly conference call and the call presentation. The conference call will be at 9 a.m. ET on Thursday, February 5. Financial information, including material announcements about The Allstate Corporation, is routinely posted on www.allstateinvestors.com. 

Forward-Looking Statements

This news release contains "forward-looking statements" that anticipate results based on our estimates, assumptions and plans that are subject to uncertainty. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements do not relate strictly to historical or current facts and may be identified by their use of words like "plans," "seeks," "expects," "will," "should," "anticipates," "estimates," "intends," "believes," "likely," "targets" and other words with similar meanings. We believe these statements are based on reasonable estimates, assumptions and plans. However, if the estimates, assumptions or plans underlying the forward-looking statements prove inaccurate or if other risks or uncertainties arise, actual results could differ materially from those communicated in these forward-looking statements. Factors that could cause actual results to differ materially from those expressed in, or implied by, the forward-looking statements may be found in our filings with the U.S. Securities and Exchange Commission, including the "Risk Factors" section in our most recent annual report on Form 10-K. Forward-looking statements are as of the date on which they are made, and we assume no obligation to update or revise any forward-looking statement.

About Allstate
The Allstate Corporation (NYSE: ALL) protects people from life's uncertainties with affordable, simple and connected protection for autos, homes, electronic devices and identities. Products are available through a broad distribution network including Allstate agents, independent agents, major retailers, online and at the workplace. Allstate has more than 210 million policies in force and is widely known for the slogan "You're in Good Hands with Allstate." For more information, visit www.allstate.com. 

Definitions of Non-GAAP Measures

We believe that investors' understanding of Allstate's performance is enhanced by our disclosure of the following non-GAAP measures. Our methods for calculating these measures may differ from those used by other companies and therefore comparability may be limited.

Adjusted net income (loss) is net income (loss) applicable to common shareholders, excluding:

• Net gains and losses on investments and derivatives
• Pension and other postretirement remeasurement gains and losses
• Amortization or impairment of purchased intangibles
• Gain or loss on disposition
• Adjustments for other significant non-recurring, infrequent or unusual items, when (a) the nature of the charge or gain is such that it is reasonably unlikely to recur within two years, or (b) there has been no similar charge or gain within the prior two years
• Related income tax expense or benefit of these items

Net income (loss) applicable to common shareholders is the GAAP measure that is most directly comparable to adjusted net income.

We use adjusted net income as an important measure to evaluate our results of operations. We believe that the measure provides investors with a valuable measure of the Company's ongoing performance because it reveals trends in our insurance and financial services business that may be obscured by the net effect of net gains and losses on investments and derivatives, pension and other postretirement remeasurement gains and losses, amortization or impairment of purchased intangibles, gain or loss on disposition and adjustments for other significant non-recurring, infrequent or unusual items and the related tax expense or benefit of these items. Net gains and losses on investments and derivatives, and pension and other postretirement remeasurement gains and losses may vary significantly between periods and are generally driven by business decisions and external economic developments such as capital market conditions, the timing of which is unrelated to the insurance underwriting process. Gain or loss on disposition is excluded because it is non-recurring in nature and the amortization or impairment of purchased intangibles is excluded because it relates to the acquisition purchase price and is not indicative of our underlying business results or trends. Non-recurring items are excluded because, by their nature, they are not indicative of our business or economic trends. Accordingly, adjusted net income excludes the effect of items that tend to be highly variable from period to period and highlights the results from ongoing operations and the underlying profitability of our business. A byproduct of excluding these items to determine adjusted net income is the transparency and understanding of their significance to net income variability and profitability while recognizing these or similar items may recur in subsequent periods. Adjusted net income is used by management along with the other components of net income (loss) applicable to common shareholders to assess our performance. We use adjusted measures of adjusted net income in incentive compensation. Therefore, we believe it is useful for investors to evaluate net income (loss) applicable to common shareholders, adjusted net income and their components separately and in the aggregate when reviewing and evaluating our performance. We note that investors, financial analysts, financial and business media organizations and rating agencies utilize adjusted net income results in their evaluation of our and our industry's financial performance and in their investment decisions, recommendations and communications as it represents a reliable, representative and consistent measurement of the industry and the Company and management's performance. We note that the price to earnings multiple commonly used by insurance investors as a forward-looking valuation technique uses adjusted net income as the denominator. Adjusted net income should not be considered a substitute for net income (loss) applicable to common shareholders and does not reflect the overall profitability of our business.

The following tables reconcile net income (loss) applicable to common shareholders and adjusted net income (loss). Taxes on adjustments to reconcile net income (loss) applicable to common shareholders and adjusted net income (loss) generally use a 21% effective tax rate.

The following tables reconcile return on Allstate common shareholders' equity and adjusted net income (loss) return on Allstate common shareholders' equity. 

Combined ratio excluding the effect of catastrophes, prior year reserve reestimates and amortization or impairment of purchased intangibles ("underlying combined ratio") is a non-GAAP ratio, which is computed as the difference between four GAAP operating ratios: the combined ratio, the effect of catastrophes on the combined ratio, the effect of prior year non-catastrophe reserve reestimates on the combined ratio, and the effect of amortization or impairment of purchased intangibles on the combined ratio. We believe that this ratio is useful to investors, and it is used by management to reveal the trends in our Property-Liability business that may be obscured by catastrophe losses, prior year reserve reestimates and amortization or impairment of purchased intangibles. Catastrophe losses cause our loss trends to vary significantly between periods as a result of their incidence of occurrence and magnitude, and can have a significant impact on the combined ratio. Prior year reserve reestimates are caused by unexpected loss development on historical reserves, which could increase or decrease current year net income. Amortization or impairment of purchased intangibles relates to the acquisition purchase price and is not indicative of our underlying insurance business results or trends. We believe it is useful for investors to evaluate these components separately and in the aggregate when reviewing our underwriting performance. The most directly comparable GAAP measure is the combined ratio. The underlying combined ratio should not be considered a substitute for the combined ratio and does not reflect the overall underwriting profitability of our business.

The following tables reconcile the respective combined ratio to the underlying combined ratio. Underwriting margin is calculated as 100% minus the combined ratio.

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SOURCE The Allstate Corporation