Following the $1.08 billion payout by Allstate Corp. for natural disaster claims, the net income for the company’s third quarter fell by 55 percent.
Equally, the insurer also said that its investment results were better, and that its auto insurance segment profits assisted in offsetting some of the losses resulting from this year’s storms. Overall, it saw a $165 million net income, which translates to 32 cents per share, when compared with the figures in 2010 which were 68 cents per share and a net income of $367 million.
Allstate said that at the same time, it saw a revenue of $8.24 billion, which is an increase of 4.2 percent over last year’s $7.91 billion.
The newly adjusted operating income at Allstate, which does not include unusual items or capital gains, was $84 million, which is 16 cents per share. Last year, this figure was 83 cents per share and $452 million. Industry analysts had predicted that the revenue would be $7.99 billion with 8 cents per share.
Allstate had previously revealed its pre-tax catastrophe losses for the third quarter to be $1.08 billion; a number that is a great deal higher than the 2010 third quarter’s $386 million.
In terms of its investments, the insurer saw notable improvements, with an increase of $264 million from capital gains. Last year, the company was managing a $144 million loss.
At the same time, Allstate said that its homeowners policy premiums had been increased in order to make up for the rise in storm claims this year. Furthermore, according to its CEO, Thomas Wilson, it ceased to offer coverage for homes that are located in areas that it feels are too risky for insurance.