Allstate Corp. reported Q1 2025 net income applicable to common shareholders of $566 million, down 52.4% from the prior year, largely due to $3.3 billion in gross catastrophe losses -- the highest quarterly total in the company’s history.
While $1.1 billion in reinsurance recoveries offset a portion of the impact, the insurer still faced $2.2 billion in net catastrophe losses. As a result, Allstate’s property-liability combined ratio rose to 97.4, up from 93.0 in Q1 2024. Property-liability underwriting income fell nearly 60% year-over-year to $360 million.
Despite the pressure from catastrophic events -- particularly wildfires in California and severe windstorms in March -- underlying results showed improvement. Property-liability written premiums grew 8.5% to $14.3 billion, driven by higher average premiums. The underlying combined ratio, which excludes catastrophe and prior-year reserve changes, improved by 3.8 points to 83.1.
The auto insurance segment delivered a standout performance, with underwriting income climbing 132.5% to $816 million and the combined ratio improving 4.7 points to 91.3. This marks continued recovery for the segment after years of struggling to offset rising claim costs.
In contrast, the homeowners business was hit hard by catastrophe claims. The segment posted a $451 million underwriting loss in Q1 2025, compared to a $564 million profit in the same period last year. Its combined ratio spiked to 112.3 from 82.1. Still, written premiums in the homeowners line rose 20.1%, supported by higher average premiums and a 2.5% increase in policies in force.
“Allstate’s strategy, operational excellence and risk management practices generated strong first quarter results, despite unprecedented severe weather,” said Tom Wilson, chair, president and CEO of Allstate, in a news release.
He added that the company’s capital position was further strengthened by the $2 billion sale of its employer voluntary benefits business on April 1 and $854 million in net investment income during the quarter.
