Allstate lost more than a billion dollars during the first quarter, stemming from the sale of its life insurance and annuity business. But the company substantially boosted revenues based on continued gains from its acquisition of National General.

First quarter 2021 net losses surpassed $1.4 billion, or negative $4.60 per diluted common share. That compares to $513 million in net income, or $1.59 per diluted common share in the 2020 first quarter.

Allstate also took a hit on consolidated net catastrophe losses, which reached $590 million during the quarter, up from $211 million the year before.

Allstate blamed the negative net income on divesting its life and annuity business, which produced a $4 billion loss on its own and led to the resulting $1.4 billion net loss. But the company has boosted rates and revenue solidly and otherwise performed well, according to Allstate Chairman, President and CEO Tom Wilson.

“Our long-term approach to investing, reinsurance and building a digital insurer is creating shareholder value and positively impacted results this quarter,” Wilson said in prepared remarks.

Wilson noted that Allstate increased its customer base, that it enjoyed sold rate increases and that its investment income also grew substantially.

Total investment income grew to $708 million during the quarter, versus $246 million in the 2020 first quarter.

Wilson noted gross catastrophe losses of nearly $1.7 billion for the quarter, but said they were offset by more than $1 billion of reinsurance and subrogation recoveries.

As well, Wilson said the company’s ongoing revamp under its “Transformative Growth” plan has led to higher new business sales for Allstate for property liability, driven by the direct channel. Cost reductions under the effort have helped the company improve customer service and also achieve an 83.3 combined ratio for the quarter, he added.

The plan announced last October, involves the elimination of about 3,800 jobs in claims, sales, service and support functions, with an eye on growing its property/casualty market share more rigorously.

Other Q1 result highlights:

• For its property-liability results, Allstate booked nearly $9.8 billion in premiums written, versus $8.6 billion in Q1 2020. Its Allstate brand generated $8.4 billion of that result, up slightly from $8.37 billion the year before its newly-acquired National General brand produced $1.3 billion in premiums written during the quarter, making up the difference.
• The company generated more than $1.6 billion in underwriting income during Q1, compared to $1.3 billion in the 2020 first quarter. The Allstate brand generated $1.5 billion of that in Q1, versus nearly $1.3 billion a year ago. National General added $138 million to the Q1 2021 net income total.
• The property-liability combined ratio was 83.3, versus 84.8 in Q1 2020. Allstate’s auto arm produced an 80.5 combined ratio, versus 89.3 last year. Its homeowners division had an 88.8 combined ratio, up from 71.5 in Q1 2020.
• Consolidated revenues surpassed $12.4 billion, compared to nearly $9.9 billion a year ago.

Source: Allstate