Allstate Reports Growth in Earnings and Strategic Initiatives for 2025
In the fourth quarter of 2025, Allstate reported a substantial decrease in expenses, which fell to $12.4 billion from $14.05 billion in the same period the previous year. The insurance company's net income applicable to common shareholders rose significantly to $3.8 billion compared to $1.9 billion in the prior year's corresponding quarter. Total revenue increased by 5.1% year-on-year, reaching $17.3 billion, showcasing effective risk management and regulatory compliance.
The insurer's diluted earnings per share saw a notable rise, climbing to $14.37 from $7.07 in the last year's quarter. Property-Liability written premiums experienced a growth of 5.9%, totaling $14.5 billion, driven by both auto and homeowners insurance premiums and an increase in policy numbers. Underwriting income for this segment improved to $4 billion, up from $1.8 billion, while catastrophe losses were reduced by nearly half, reaching $209 million.
Auto and Homeowners Insurance Performance
Specifically, auto insurance written premiums increased by 3.1% to $9.34 billion, with earned premiums rising by 2.9%. The combined ratio improved by 12.7 points to 80.8, aided by higher average earned premiums and decreased loss costs. For homeowners insurance, written premiums climbed 13.4% to $4.1 billion, influenced by increased average premiums and policy growth. The average gross written premium for Allstate brand homeowners insurance went up by 7.4%, highlighting effective underwriting strategies.
Protection Services and Full-Year Performance
In the Protection Services sector, revenue grew by 3.1% to $917 million, primarily due to enhancements in protection plans and roadside services. Adjusted net income in this segment increased to $57 million. For the entire year of 2025, Allstate reported that net income applicable to common shareholders doubled to $10.2 billion from $4.6 billion in 2024. Annual revenue reached $67.7 billion, marking a 5.6% increase from the previous year. The company returned over $2.2 billion to its shareholders via repurchases and dividends throughout the year, demonstrating successful payer and provider strategies.
Strategic Initiatives and Future Outlook
Looking ahead, Allstate announced it will increase its quarterly dividend to $1.08 per share, payable on April 1, 2026, for shareholders on record as of March 2, 2026. A new share repurchase program, valued at $4 billion, will commence following the completion of the current $1.5 billion initiative. In efforts to combat cost inflation, Allstate reduced premiums for 7.8 million auto and homeowners policies by an average of 17% through strategic coverage reviews. Additionally, improvements were made in customer interactions and the company provided nearly $38 billion in support and financial resources for claims and unforeseen events in 2025.
Commenting on these developments, Allstate CEO Tom Wilson stated, "Allstate had a terrific year by better serving customers and making protection more affordable." He highlighted the reduction of premiums through tailored coverage reviews as a strategic move to address cost pressures effectively, aligning with industry standards for regulatory compliance requirements.