Allstate Corp.’s net income applicable to common shareholders jumped to $1.46 billion from a $303 million net loss a year earlier.
Chair, President and Chief Executive Officer Tom Wilson said improved underwriting performance and greater investment income were behind the change.
Property-liability premiums earned grew 10.7% to $12.6 billion. The combined ratio improved 19.6 points to 89.5.
“The transformation of Allstate’s personal property-liability business to generate higher growth also made significant progress by reducing expenses, expanding customer access and leveraging technology. Allstate exclusive agent bundling and productivity increased, excluding three states where profit actions reduced new business, and National General is growing through independent agents,” Wilson said in a statement.
Pretax catastrophe losses fell to $68 million from $779 million in the fourth quarter of 2022.
Unfavorable prior-year reserve reestimates for claims, largely for personal automobile insurance, far exceeded catastrophe losses in the quarter. Excluding catastrophes, Allstate recently said reserve estimates totaled $199 million, attributing about $148 million to personal auto, including the cost of litigated claims.
The unfavorable reserve reestimates improved from $282 million during the prior-year period. At the time, Allstate said about $100 million of the reserve development was related to increased severity in commercial auto insurance, largely in shared economy coverage and states the company was exiting.
Rates hikes of 30% in California, 20% in New Jersey and 14.6% in New York for branded auto started to take effect in the last month of the year and will continue through February. The company earlier said it would shed Allstate brand auto coverage in the three states unless regulators approved rate increases.