ALLAllstate Corporation (The)

Allstate insures cars and homes for individuals — a market where pricing accuracy decides everything.

Profit combines underwriting with income on reserves. The key metric is the combined ratio — the share of premium consumed by claims and expenses. Below one hundred means underwriting is profitable in itself.

In recent years the industry endured a sharp rise in the cost of repairing cars and homes: parts, electronics and labour rose faster than rates could follow, and insurers moved into loss. The answer was raising prices and withdrawing from unprofitable states, which costs market share.

A separate risk is catastrophe: hurricanes, hail and wildfires can consume a year's profit in a quarter, and their frequency is rising. The company sells directly and through agents, giving different cost structures. Allstate pays a dividend.