Bank of America Merrill Lynch
2014 Insurance Conference
February 12, 2014
Thomas J. Wilson
Chairman, President, and Chief Executive Officer
Safe Harbor
This presentation contains forward-looking statements and information. Additional information on
factors that could cause results to differ materially from those projected in this presentation is available
in the 2012 Form 10-K, our Form 10-Q for the quarter ended September 30, 2013, the last slide of this
presentation, and in our most recent earnings release, available on our website, allstate.com. This
presentation also contains some non-GAAP measures. You can find the reconciliation of those
measures to GAAP measures on the Investor Relations portion of our website, allstate.com, under the
“Quarterly Investor Info” link and “Conference Call Archive” link.
Bank of America Merrill Lynch Conference: February 12, 2014 1
Continuing to Effectively Execute Our Strategy to Provide Competitively
Unique Offerings to Distinct Consumer Segments
Brand
Neutral
Self-
Serve
Local Advice
and Assistance
Brand
Sensitive
Market Premium Share
Auto: ~30%
Property: ~35%
Encompass Rank #15
Market Premium Share
Auto: <1%
Property: <1%
Market Premium Share
Auto: ~25%
Property: ~10%
Esurance Rank #7
Market Premium Share
Auto: ~45%
Property: ~55%
Allstate Rank #2
2 Bank of America Merrill Lynch Conference: February 12, 2014
(1) Available to common shareholders
Excellent 2013 Return on Equity and Policy Growth
Financial Highlights
($ in Millions, PIF in thousands, except per share data)
2013
%
Change
Revenues $34,507 3.6
Allstate Protection Policies 33,336 1.5
Net Income(1) 2,263 (1.9)
Per Diluted Common Share(1) 4.81 2.8
Operating Income 2,670 24.3
Per Diluted Common Share 5.68 30.3
Book Value Per Common Share
Reported 45.31 6.9
Excluding the impact of
unrealized net capital gains
and losses on fixed income
securities
42.55 14.6
ROE Net Income 11.0% (0.9)pts
Operating Income 14.5% 2.1pts
2013 Operating Priorities and Results
■ Grow insurance premiums
‒ Positive premium growth; all brands contributing
■ Maintain auto profitability
‒ Protection Auto recorded combined ratio: 96.4
‒ Allstate Brand Auto maintaining underlying performance;
Esurance & Encompass profit improvement underway
■ Raise returns in homeowners & annuity businesses
‒ Allstate Brand Homeowners underlying combined ratio: 62.7
‒ Divestiture of LBL, subject to regulatory approval
■ Proactively manage investments
‒ Protection portfolio duration reduced to mitigate rate risk
‒ Annuity returns improved; long-term
outlook remains challenging
■ Reduce the cost structure
‒ Pursuing continuous improvement, simplifying
processes and streamlining technology
3 Bank of America Merrill Lynch Conference: February 12, 2014
4
Operating Priorities for 2014
Our priorities have evolved to reflect success in achieving return improvement
goals established in 2011 and a focus on balancing growth and returns
2014 Priorities
1. Grow insurance policies in force
2. Maintain the underlying
combined ratio
3. Proactively manage investments
to generate attractive
risk-adjusted returns
4. Modernize the operating model
5. Build long-term growth platforms
2013 Priorities
1. Grow insurance premiums
2. Maintain auto profitability
3. Raise returns in the homeowners
and annuity businesses
4. Proactively manage investments
5. Reduce the cost structure
Bank of America Merrill Lynch Conference: February 12, 2014
■ Each Brand is positively contributing to growth
‒ Allstate Brand auto growing over prior year
‒ Homeowners rate of decline decreasing;
positioned for profitable growth
‒ Esurance, Encompass growth rates are
expected to slow given profit improvement
actions
■ Exclusive Agency force is energized and engaged
‒ Footprint is growing year over year
‒ Agencies are larger and better capitalized
‒ Agency relationship survey results
significantly improved
‒ Agency engagement in writing Allstate
Financial products continues to rise
Growth Momentum Continues to Build
Allstate Brand Auto and Homeowners Policies in Force
-0.9% -1.4% -1.3%
-1.0%
-0.3%
0.7%
1.5%
-3.8%
-4.6%
-5.8% -5.4%
-4.4%
-3.2%
-2.2%
-8%
-6%
-4%
-2%
0%
2%
2010 2011 2012 Q1 13 Q2 13 Q3 13 Q4 13
Auto Homeowners
Protection Written Premium & Policies in Force
-0.2%
0.3%
4.0%
2.5%
4.2%
5.3% 4.7%
-2.4%
0.8%
-1.1% -0.7%
0.0%
0.8%
1.5%
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
2010 2011 2012 Q1 13 Q2 13 Q3 13 Q4 13
Net Written Premium PIF
(1)
(1) Growth rate in 2012 reflects acquisition of Esurance in 2011
5 Bank of America Merrill Lynch Conference: February 12, 2014
6
Proactively Responding to External Change: Drivewise® & DriveSense™
More Touchpoints, Safer Drivers
■ Drivewise currently in 30 states;
DriveSense in 15 states
■ Nearly 1.5 billion miles of data recorded
since inception
■ Extending the value proposition beyond
pricing:
■ Improve driving behaviors
■ Teen safe driving
■ Platform for future services
Bank of America Merrill Lynch Conference: February 12, 2014
7
Long-Term Growth Platform: Allstate Business to Business
(1) Revenue defined as premiums written for Business Insurance, Roadside, and Dealer Services; and total premiums & contract charges plus net investment income for Allstate Benefits.
Benefits YE 2013 % Var to
PY
Revenue(1) $0.9B 9.3%
Business Insurance YE 2013 % Var to
PY
Revenue(1) $0.5B 2.7%
Policies in Force 301K 6.4%
Roadside Services YE 2013 % Var to
PY
Revenue(1) $0.4B 17.7%
Good Hands
Roadside Members 1.6M 82.2%
Dealer Services YE 2013 % Var to
PY
Revenue(1) $0.3B 52.6%
■ Organization created to better serve business
customers under one leadership structure
‒ Includes Encompass (~50% of B2B premiums
written) and Ivantage in addition to the entities
on the right
■ Combined entity provides a focused platform for
growth:
‒ Earned Premium of $2.1B for 2013 grew 7.5%
versus 2012 (8.3% excluding Encompass)
‒ Policies in Force of 2.5 million grew 3.0% in
2013 (-0.2% excluding Encompass)
‒ Consolidated underlying combined ratio: 93.4
was 0.7pts higher than 2012
Bank of America Merrill Lynch Conference: February 12, 2014
(1) Price/Book and Book Value metrics stated on a Tangible Book Value basis. Source: Bloomberg (2) There were five dividend payments made in 2012
Allstate Is An Attractive Investment Opportunity
8
■ Strategy creates sustainable revenue and earnings growth by offering unique
products to four distinct consumer segments
■ Focused, consistent priorities and a history of delivering on our commitments
■ Attractive auto and underlying homeowner margins
■ Well-established track record of strong cash returns to shareholders
■ Valuation continues to have significant upside potential
Strong Cash Returns
Returned over $32 Billion to Shareholders
since 1995 Spin-off from Sears
Price / Book Multiple(1)
Price per share at:
Mean = $63
+1 Std Dev = $81
-1 Std Dev = $46
Q4
1995
Q4
2013 Q4
2001
Q4
2008
0
1
2
3
Cash Returned
per Common
Share % Returned
2013 $4.67 9.4%
2012(2) $2.94 8.3%
2011 $2.65 9.2%
Bank of America Merrill Lynch Conference: February 12, 2014
9
Safe Harbor
This presentation contains a forward-looking statement about our outlook for the Property-Liability
underlying combined ratio. This statement is made subject to the safe-harbor provisions of the Private
Securities Litigation Reform Act of 1995. Actual results may differ materially from those described in
the forward-looking statement for a variety of reasons, including the following:
Premiums written and premiums earned, the denominator of the underlying combined
ratio, may be materially less than projected. Policyholder attrition may be greater than
anticipated resulting in a lower amount of insurance in force.
We undertake no obligation to publicly correct or update any forward-looking statements.
Bank of America Merrill Lynch Conference: February 12, 2014