US primary insurer Allstate has reported $1.4 billion loss in the first quarter of 2021, compared to net income of $513 million in the first quarter of 2020, driven by the sale of Allstate Life Insurance Company and Allstate Life Insurance Company of New York.
The company also sustained gross catastrophe losses of $1.67 billion for the quarter, nearly eight times greater than 2020.
However these losses were offset by $1.08 billion of reinsurance and subrogation recoveries.
Allstate’s combined ratio for the quarter improved from 84.8% in Q1 2020 to 83.3%.
Meanwhile, total revenues of $12.5 billion during the quarter represents an increase of 26.2%, primarily reflecting the acquisition of National General.
Higher earned premiums from protection services, increased performance-based investment income and net realised capital gains also contributed to revenue growth in the quarter.
On the investment side, Allstate’s $60.1 billion portfolio generated an income of $708 million, an increase of $462 million from the prior year quarter, driven by higher performance-based income
“Allstate increased our customer base and generated excellent returns this quarter, reflecting strong operating results, the acquisition of National General and divestitures of the life and annuity businesses,” said Tom Wilson, Chair, President and CEO of The Allstate Corporation.
“Personal property-liability premiums earned and policies in force increased by 11.4% and 12.1% from the prior year, respectively. Revenues from the Protection Services segment increased by 21.6% from 2020, reflecting continued expansion of Allstate Protection Plans.
“The announced divestitures of the life and annuity businesses generated a $4.0 billion loss, which resulted in a net loss for the quarter of $1.4 billion.
“Adjusted net income*, however, was $1.9 billion, or $6.11 per common share, for the quarter, representing a 23.2% return on equity over the last twelve months.
“Our long-term approach to investing, reinsurance and building a digital insurer is creating shareholder value and positively impacted results this quarter,” Wilson concluded.