: Allstate tells Wall Street to brace for higher catastrophe losses in Q4, thanks to December winter storm

by | Jan 18, 2023 | Stock Market

Allstate Corp. late Wednesday told Wall Street to expect higher catastrophe losses on its balance sheet, thanks to the severe winter storm that blanketed two-thirds of the U.S. in frigid temperatures and snow in December. Allstate
estimated fourth-quarter catastrophe losses of $779 million, including December losses of about $616 million. FactSet consensus calls for fourth-quarter catastrophe losses of around $568 million.

Winter Storm Elliott, which hit most of the U.S. Eastern Seaboard and the Midwest in late December and led to dozens of deaths around Buffalo, N.Y., accounted for some 80%, or $478 million, of December’s estimated catastrophe losses, Allstate said. Shares of Allstate dropped nearly 3% in the extended session Wednesday after ending the regular trading day down 2.3%. Allstate said it expects to lose between $285 million and $355 million in the quarter, and estimated adjusted net losses between $335 million and $385 million. Written premiums rose 11% year-on-year to $11.5 billion, thanks mostly to higher average auto- and home-insurance premiums, the insurer said. Written auto premiums rose 13% to $7.8 billion, reflecting a 14% increase in average premiums, the company said. “Allstate continued to implement significant auto-insurance rate actions in the second …

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