Allstate’s revenue increases by $16.6 billion, net income by $2.1 billion
Allstate’s revenue increased by $16.6 billion and net income by $2.1 billion for the second quarter, according to a news release.
“Allstate had strong operating and financial performance in the second quarter while executing our growth strategies,” said Tom Wilson, Allstate’s CEO, in the release.
Total policies in force increased by 208 million, 4% higher than last year, he said.
“Personal property-liability policies have begun to grow due to expanded distribution, new products, and increased marketing,” Wilson said.
Revenues in Q2 were up 5.8% from the same quarter last year. Net income rose $643 million from $301 million last year.
Allstate saw auto insurance written and earned premiums grow from 2.7% to 4.9% compared to the same quarter last year, the release states.
Rate increases in Q2 resulted in an annualized premium impact of 0.4%.
Auto policies grew by 0.5% as a 24.8% increase in new business was negatively impacted by reductions in New York and New Jersey and lower customer retention, the release says.
Excluding New York and New Jersey, policy growth was 1.9% higher than the year prior, the release says.
The recorded auto insurance combined ratio was 86.0 in Q2, a 9.9 point improvement from the prior year quarter, according to the release. It says this is because of higher average earned premiums, moderating loss costs, and favorable prior-year non-catastrophe reserve releases.
During Allstate’s Q2 earnings call, Mario Rizzo, the insurer’s property-liability president, said the company has seen favorable improvements in its auto insurance business.
“Our auto book of business is now broadly profitable, including in previously profit-challenged markets like California, New York, and New Jersey, and we are focused on investing in profitably growing auto market shares,” Rizzo said.
Rizzo added that the company is currently waiting for approval of pending requests for new “affordable, simple, and connected auto insurance products” in New York and New Jersey.
In late 2023, Wilson said Allstate would exit California, New York, and New Jersey if its rate increase requests weren’t approved. Days later, California approved a 30% increase, New York a 14.66% increase, and New Jersey a 20% increase.
Months later, Rizzo said during Allstate’s 2024 Q1 earnings call that the company still needed higher increases in New York and New Jersey. At that time, he said the company would have to continue restricting insurance in New Jersey
Wilson reiterated at the time that Allstate business could be restricted in states that weren’t meeting target returns.
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