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Allstate’s 2019 cat losses down after quiet end to year

16th January 2020 - Author: Luke Gallin

The Allstate Corporation has announced that catastrophe losses in the month of December reached $25 million (pre-tax), taking its fourth-quarter 2019 estimated cat loss total to $295 million (pre-tax).

Allstate logo newCombined with the firm’s loss experience throughout the rest of 2019, Allstate’s 2019 catastrophe loss bill stands at approximately $2.6 billion, which is down on the $2.9 billion posted a year earlier and also on the $3.2 billion recorded in 2017.

Reinsurance News reported previously that Allstate had incurred catastrophe losses of $237 million and $33 million in October and November of 2019, respectively.

Now, with the addition of December’s loss total, the firm has revealed its overall losses for the fourth-quarter and full-year 2019, both of which are down on the same period in 2018.

Allstate reported catastrophe losses of $680 million, pre-tax in the first-quarter, which was followed by $1.072 billion of losses in Q2 and then $510 million in the third-quarter of 2019. Add the $295 million of pre-tax cat losses announced for Q4, and the firm’s 2019 loss experience reaches just under $2.6 billion.

At a combined $1.76 billion, 68% of the company’s 2019 catastrophe losses were experienced in the first-half of the year.

In recent times, severe convective weather outbreaks and also hail related events have become a significant driver of losses above expectations in re/insurance markets.

In May of last year, the firm expanded its catastrophe reinsurance program for 2019 – 2020 to $4.863 billion, with the increase in catastrophe reinsurance limit acquired by Allstate relating to its Nationwide Program.

Allstate’s nationwide aggregate protection now triggers at $3.54 billion of qualifying losses, so currently seems pretty safe from losses. However, it only takes one big event to alter the landscape.

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