8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15 (d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): February 4, 2015

THE ALLSTATE CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	1-11840	36-3871531
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2775 Sanders Road, Northbrook, Illinois	60062
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code  (847) 402-5000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2 – Financial Information

Item 2.02.Results of Operations and Financial Condition.

On February 4, 2015, the registrant issued a press release announcing its financial results for the fourth quarter of 2014, and the availability of the registrant’s fourth quarter investor supplement on the registrant’s web site.  The press release and the investor supplement are furnished as Exhibits 99.1 and 99.2 to this report.  The information contained in the press release and the investor supplement are furnished and not filed pursuant to instruction B.2 of Form 8-K.

Section 9 – Financial Statements and Exhibits

Item 9.01.Financial Statements and Exhibits.

(d)  Exhibits

99.1Registrant’s press release dated February 4, 2015

99.2Fourth quarter 2014 Investor Supplement of The Allstate Corporation

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	THE ALLSTATE CORPORATION
	(Registrant)
	By:	/s/ Samuel H. Pilch
	Name: Samuel H. Pilch
	Title: Senior Group Vice President and Controller
Date: February 4, 2015

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EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE
Contacts:
Maryellen Thielen	Pat Macellaro
Media Relations	Investor Relations
(847) 402-5600	(847) 402-2800

Allstate Sustains Growth and Profitability

Increases Quarterly Dividend 7%, Announces $3 Billion Common Stock Repurchase Plan

NORTHBROOK, Ill., February 4, 2015 – The Allstate Corporation (NYSE: ALL) today reported financial results for the fourth quarter and full year 2014. The financial highlights were:

The Allstate Corporation Consolidated Highlights
	Three months ended December 31,			Twelve months ended December 31,
($ millions, except per share amounts and ratios)	2014	2013	% / pts Change	2014	2013	% / pts Change
Consolidated revenues	$ 8,759	$ 8,792	(0.4)	$ 35,239	$ 34,507	2.1
Net income available to common shareholders	795	810	(1.9)	2,746	2,263	21.3
per diluted common share	1.86	1.76	5.7	6.27	4.81	30.4
Operating income*	736	781	(5.8)	2,367	2,670	(11.3)
per diluted common share*	1.72	1.70	1.2	5.40	5.68	(4.9)
Return on common shareholders’ equity
Net income available to common shareholders				13.3%	11.0%	2.3  pts
Operating income*				12.6%	14.5%	(1.9) pts
Book value per common share				48.24	45.31	6.5
Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities*				44.33	42.55	4.2
Property-Liability combined ratio
Recorded	90.0	88.7	1.3  pts	93.9	92.0	1.9 pts
Underlying combined ratio* (excludes catastrophes, prior year reserve reestimates and amortization of purchased intangibles)	89.5	87.5	2.0  pts	87.2	87.3	(0.1) pts
Catastrophe losses	95	117	(18.8)	1,993	1,251	59.3

*Measures used in this release that are not based on accounting principles generally accepted in the United States of America (“non-GAAP”) are defined and reconciled to the most directly comparable GAAP measure in the “Definitions of Non-GAAP Measures” section of this document.

“Allstate’s sustained growth and profitability reflects the progress we have made in building a competitively differentiated insurance company,” said Thomas J. Wilson, chairman and chief executive officer of The Allstate Corporation. “Our strategy to serve customers with unique value propositions enabled the property-liability businesses to increase policies in force across all three underwritten brands by 840,000, which led to a $1.5 billion increase in premiums written in 2014. Excellent operating results generated net income of $2.7 billion and operating income of $2.4 billion for the year. The underlying combined ratio was at the favorable end of the full-year outlook range, as the negative impact of adverse fourth quarter frequency on auto margins was more than offset by our focus on profitable growth. As a result, we are maintaining the underlying combined ratio outlook range at 87 to 89 for 2015.

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“Shareholders benefited from this strong operating performance,” Wilson said. “Allstate returned $2.8 billion to shareholders in 2014 through a combination of dividends and share repurchases. The board decided to raise the quarterly dividend by 7% to 30 cents per share for the first quarter of 2015. In addition, a new $3 billion share repurchase program was approved to start immediately upon completion of the current $2.5 billion program, which is expected in the first quarter of 2015.”

Operating Results: Fourth Quarter 2014

Operating performance in the fourth quarter reflected a continuation of the year’s growth trajectory and auto margins that were impacted by higher claim frequency. Growth in Allstate brand policies in force continued its positive momentum, with auto insurance policies 2.9% higher than the prior year and homeowner policies beginning to grow as a broad set of initiatives to improve returns have now been implemented.

An increase in claim frequency in the first two months of the quarter adversely impacted the combined ratio for auto insurance, with the Allstate brand auto combined ratio rising to 97.0. This was 1.7 points higher than the prior year. The impact of precipitation in select markets and general economic trends will both be reflected in pricing as necessary to maintain adequate returns.  Excellent homeowners profitability brought the property-liability recorded combined ratio to 90.0 for the quarter. Allstate Financial operating income decreased by 20% from the prior year’s quarter to $128 million, largely due to the disposition of Lincoln Benefit Life (LBL).

Net income available to common shareholders was $1.86 per share, or $795 million versus $1.76 per share in the fourth quarter of last year. Operating income was $1.72 per share, or $736 million compared to $1.70 in 2013.

Key metrics for the quarter:

·Policy in force growth: Total Property-Liability (2.5%), Allstate auto (2.9%), Allstate homeowners (0.5%), Esurance (12.6%), Encompass (1.8%)

·Recorded combined ratios: Total Property-Liability (90.0), Allstate auto (97.0), Allstate homeowners (63.6), Esurance (115.5), Encompass (93.1)

·Pre-tax yield on investment portfolio: 4.2%

Full Year Results

Results for 2014 demonstrate successful execution of the strategy to provide unique value propositions to each customer segment. The Allstate brand accounted for more than 80% of the $1.5 billion growth in net written premium over prior year, driven by broad-based policy and average premium growth in both auto and homeowners.

Underwriting income for 2014 was adversely impacted by a 59.3% increase in catastrophe losses compared with historically low 2013 levels, and resulted in a property-liability combined ratio of 93.9 for 2014, 1.9 points unfavorable to the prior year. The underlying property-liability combined ratio of 87.2 for 2014 was 0.1 point better than 2013, the result of our approach to managing pricing and underwriting actions on a local basis to keep pace with loss trends and maintain margins.

Allstate Financial recorded net income of $631 million in 2014, compared to net income of $95 million in 2013, which included the initial estimated loss on the disposition of LBL. Operating income increased 3.2% to $607 million from 2013.

Net investment income of $3.5 billion for 2014 was 12.3% lower than 2013 due to the LBL divestiture, the continued planned reduction in deferred annuities, and the ongoing impact of low interest rates on the portfolio’s results. Limited partnership income was strong in 2014, partially offsetting the impact of low interest rates.

Other milestones achieved in 2014:

·Allstate brand exclusive agencies increased by approximately 400 or 4% in the United States and continued to evolve to a trusted advisor model.

·Allstate brand auto policy growth of 2.9% was driven by increased retention and new issued applications that were 18.5% above the previous ten-year average.

·Esurance continued to expand its geographic reach and product portfolio. In 2014, the company expanded its auto, renters, homeowners and motorcycle

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insurance to additional states.

·The Drivewise® program is now in 46 states plus the District of Columbia. To date, customers using Drivewise have driven nearly six billion miles over the course of more than 220 million hours on the road.

·Recorded combined ratios: Total Property-Liability (93.9), Allstate auto (94.7), Allstate homeowners (82.5), Esurance (117.7), Encompass (106.1)

·Underlying combined ratios: Total Property-Liability (87.2), Allstate auto (94.2), Allstate homeowners (61.7), Esurance (114.2), Encompass (93.7)

·Total return on investment portfolio: 5.8%

Proactive Capital Management

“We continued to provide good returns to our shareholders and maintain a strong capital position to provide strategic flexibility,” said Steve Shebik, chief financial officer. “In 2014, we returned $2.8 billion to shareholders through a combination of common stock dividends and repurchasing 8.7% of our beginning-of-year-outstanding shares. We further improved our financial strength by repaying $950 million of maturing debt and issuing $998 million of preferred stock, decreasing our debt to capital ratio to 18.9% at year-end 2014.”

As of December 31, 2014, $336 million remained under Allstate’s authorized $2.5 billion common share repurchase program, which is expected to be completed in the first quarter of 2015. The company will then initiate its new $3 billion repurchase program to be completed by July of 2016. Holding company assets increased to $3.4 billion at year-end 2014, as the capital from the sale of LBL was successfully moved to the holding company. Book value per diluted common share increased 6.5% from a year ago, to $48.24 at year-end 2014.

The $0.30 per common share dividend declared today will be payable on April 1, 2015 to stockholders of record at the close of business on March 2, 2015.

Visit www.allstateinvestors.com to view additional information about Allstate’s results, including a webcast of its quarterly conference call and the presentation discussed on the call. The conference call will be held at 9 a.m. ET on Thursday, February 5.

The Allstate Corporation (NYSE: ALL) is the nation’s largest publicly held personal lines insurer, protecting approximately 16 million households from life’s uncertainties through auto, home, life and other insurance offered through its Allstate, Esurance, Encompass and Answer Financial brand names. Allstate is widely known through the slogan “You’re In Good Hands With Allstate®.” The Allstate brand’s network of small businesses offers auto, home, life and retirement products and services to customers in the United States and Canada.

Financial information, including material announcements about The Allstate Corporation, is routinely posted on www.allstateinvestors.com.

Forward-Looking Statements

This news release contains “forward-looking statements” that anticipate results based on our estimates, assumptions and plans that are subject to uncertainty.  These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements do not relate strictly to historical or current facts and may be identified by their use of words like “plans,” “seeks,” “expects,” “will,” “should,” “anticipates,” “estimates,” “intends,” “believes,” “likely,” “targets” and other words with similar meanings.  We believe these statements are based on reasonable estimates, assumptions and plans.  However, if the estimates, assumptions or plans underlying the forward-looking statements prove inaccurate or if other risks or uncertainties arise, actual results could differ materially from those communicated in these forward-looking statements.  Factors that could cause actual results to differ materially from those expressed in, or implied by, the forward-looking statements may be found in our filings with the U.S. Securities and Exchange Commission, including the “Risk Factors” section in our most recent Annual Report on Form 10-K and quarterly report on Form 10-Q. Forward-looking statements speak only as of the date on which they are made, and we assume no obligation to update or revise any forward-looking statement.

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THE ALLSTATE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

($ in millions, except per share data)		Three months endedDecember 31,				Twelve months endedDecember 31,
		2014		2013		2014		2013
		(unaudited)				(unaudited)
Revenues
Property-liability insurance premiums	$	7,354	$	7,014	$	28,929	$	27,618
Life and annuity premiums and contract charges		520		610		2,157		2,352
Net investment income		779		1,026		3,459		3,943
Realized capital gains and losses:
Total other-than-temporary impairment (“OTTI”) losses		(65)		(29)		(242)		(207)
OTTI losses reclassified to (from) other comprehensive income		(1)		(1)		(3)		(8)
Net OTTI losses recognized in earnings		(66)		(30)		(245)		(215)
Sales and other realized capital gains and losses		172		172		939		809
Total realized capital gains and losses		106		142		694		594
		8,759		8,792		35,239		34,507
Costs and expenses
Property-liability insurance claims and claims expense		4,618		4,283		19,428		17,911
Life and annuity contract benefits		431		490		1,765		1,917
Interest credited to contractholder funds		202		305		919		1,278
Amortization of deferred policy acquisition costs		1,035		1,069		4,135		4,002
Operating costs and expenses		1,156		1,258		4,341		4,387
Restructuring and related charges		5		11		18		70
Loss on extinguishment of debt		–		2		1		491
Interest expense		73		87		322		367
		7,520		7,505		30,929		30,423
Gain (loss) on disposition of operations		3		(44)		(74)		(688)
Income from operations before income tax expense		1,242		1,243		4,236		3,396
Income tax expense		418		422		1,386		1,116
Net income		824		821		2,850		2,280
Preferred stock dividends		29		11		104		17
Net income available to common shareholders	$	795	$	810	$	2,746	$	2,263
Earnings per common share:
Net income available to common shareholders per common share – Basic	$	1.89	$	1.79	$	6.37	$	4.87
Weighted average common shares – Basic		420.2		452.8		431.4		464.4
Net income available to common shareholders per common share – Diluted	$	1.86	$	1.76	$	6.27	$	4.81
Weighted average common shares – Diluted		427.7		459.6		438.2		470.3
Cash dividends declared per common share	$	0.28	$	0.25	$	1.12	$	1.00

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THE ALLSTATE CORPORATION

BUSINESS RESULTS

($ in millions, except ratios)		Three months ended				Twelve months ended
		December 31,				December 31,
		2014		2013		2014		2013
Property-Liability
Premiums written	$	7,292	$	6,950	$	29,614	$	28,164
Premiums earned	$	7,354	$	7,014	$	28,929	$	27,618
Claims and claims expense		(4,618)		(4,283)		(19,428)		(17,911)
Amortization of deferred policy acquisition costs		(973)		(984)		(3,875)		(3,674)
Operating costs and expenses		(1,021)		(942)		(3,838)		(3,752)
Restructuring and related charges		(5)		(11)		(16)		(63)
Underwriting income*		737		794		1,772		2,218
Net investment income		294		382		1,301		1,375
Periodic settlements and accruals on non-hedge derivative instruments		(2)		(2)		(9)		(7)
Amortization of purchased  intangible assets		17		23		68		85
Income tax expense on operations		(359)		(404)		(1,060)		(1,204)
Operating income		687		793		2,072		2,467
Realized capital gains and losses, after-tax		(11)		86		357		339
Gain (loss) on disposition of operations, after-tax		--		--		37		(1)
Reclassification of periodic settlements and accruals on non-hedge
derivative instruments, after-tax		2		1		6		4
Amortization of purchased intangible assets, after-tax		(12)		(15)		(45)		(55)
Net income available to common shareholders	$	666	$	865	$	2,427	$	2,754
Catastrophe losses	$	95	$	117	$	1,993	$	1,251
Operating ratios:
Claims and claims expense ratio		62.8		61.1		67.2		64.9
Expense ratio		27.2		27.6		26.7		27.1
Combined ratio		90.0		88.7		93.9		92.0
Effect of catastrophe losses on combined ratio		1.3		1.7		6.9		4.5
Effect of prior year reserve reestimates on combined ratio		(1.0)		(0.9)		(0.3)		(0.4)
Effect of catastrophe losses included in prior year reserve reestimates
on combined ratio		--		(0.1)		0.1		(0.3)
Effect of amortization of purchased intangible assets on combined ratio		0.2		0.3		0.2		0.3
Effect of Discontinued Lines and Coverages on combined ratio		0.1		--		0.4		0.5
Allstate Financial
Premiums and contract charges	$	520	$	610	$	2,157	$	2,352
Net investment income		480		637		2,131		2,538
Periodic settlements and accruals on non-hedge derivative instruments		--		--		(1)		17
Contract benefits		(431)		(490)		(1,765)		(1,917)
Interest credited to contractholder funds		(199)		(301)		(898)		(1,254)
Amortization of deferred policy acquisition costs		(60)		(80)		(255)		(330)
Operating costs and expenses		(121)		(145)		(466)		(565)
Restructuring and related charges		--		--		(2)		(7)
Income tax expense on operations		(61)		(71)		(294)		(246)
Operating income		128		160		607		588
Realized capital gains and losses, after-tax		81		9		94		46
Valuation changes on embedded derivatives that are not hedged, after-tax		(3)		(3)		(15)		(16)
DAC and DSI amortization relating to realized capital gains and losses
and valuation changes on embedded derivatives that are not
hedged, after-tax		--		(3)		(3)		(5)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		--		--		--		7
Reclassification of periodic settlements and accruals on non-hedge
derivative instruments, after-tax		--		--		1		(11)
Gain (loss) on disposition of operations, after-tax		2		(44)		(53)		(514)
Net income available to common shareholders	$	208	$	119	$	631	$	95
Corporate and Other
Net investment income	$	5	$	7	$	27	$	30
Operating costs and expenses		(87)		(258)		(359)		(618)
Income tax benefit on operations		32		90		124		220
Preferred stock dividends		(29)		(11)		(104)		(17)
Operating loss		(79)		(172)		(312)		(385)
Realized capital gains and losses, after-tax		--		(1)		--		--
Loss on extinguishment of debt, after-tax		--		(1)		--		(319)
Postretirement benefits curtailment gain, after-tax		--		--		--		118
Net loss available to common shareholders	$	(79)	$	(174)	$	(312)	$	(586)
Consolidated net income available to common shareholders	$	795	$	810	$	2,746	$	2,263

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THE ALLSTATE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

($ in millions, except par value data)		December 31,		December 31,
		2014		2013
Assets		(unaudited)
Investments:
Fixed income securities, at fair value (amortized cost $59,672 and $59,008)	$	62,440	$	60,910
Equity securities, at fair value (cost $3,692 and $4,473)		4,104		5,097
Mortgage loans		4,188		4,721
Limited partnership interests		4,527		4,967
Short-term, at fair value (amortized cost $2,540 and $2,393)		2,540		2,393
Other		3,314		3,067
Total investments		81,113		81,155
Cash		657		675
Premium installment receivables, net		5,465		5,237
Deferred policy acquisition costs		3,525		3,372
Reinsurance recoverables, net		8,490		7,621
Accrued investment income		591		624
Property and equipment, net		1,031		1,024
Goodwill		1,219		1,243
Other assets		2,046		1,937
Separate Accounts		4,396		5,039
Assets held for sale		--		15,593
Total assets	$	108,533	$	123,520
Liabilities
Reserve for property-liability insurance claims and claims expense	$	22,923	$	21,857
Reserve for life-contingent contract benefits		12,380		12,386
Contractholder funds		22,529		24,304
Unearned premiums		11,655		10,932
Claim payments outstanding		784		631
Deferred income taxes		715		635
Other liabilities and accrued expenses		5,653		5,156
Long-term debt		5,194		6,201
Separate Accounts		4,396		5,039
Liabilities held for sale		--		14,899
Total liabilities		86,229		102,040
Equity
Preferred stock and additional capital paid-in, $1 par value, 72.2 thousand and 32.3 thousand shares issued and outstanding, $1,805 and $807.5 aggregate liquidation preference		1,746		780
Common stock, $.01 par value, 900 million issued, 418 million and 449 million shares outstanding		9		9
Additional capital paid-in		3,199		3,143
Retained income		37,842		35,580
Deferred ESOP expense		(23)		(31)
Treasury stock, at cost (482 million and 451 million shares)		(21,030)		(19,047)
Accumulated other comprehensive income:
Unrealized net capital gains and losses:
Unrealized net capital gains and losses on fixed income securities with OTTI		72		50
Other unrealized net capital gains and losses		1,988		1,698
Unrealized adjustment to DAC, DSI and insurance reserves		(134)		(102)
Total unrealized net capital gains and losses		1,926		1,646
Unrealized foreign currency translation adjustments		(2)		38
Unrecognized pension and other postretirement benefit cost		(1,363)		(638)
Total accumulated other comprehensive income		561		1,046
Total shareholders’ equity		22,304		21,480
Total liabilities and shareholders’ equity	$	108,533	$	123,520

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THE ALLSTATE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

($ in millions)		Twelve months ended December 31,
		2014		2013
Cash flows from operating activities		(unaudited)
Net income	$	2,850	$	2,280
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and other non-cash items		366		368
Realized capital gains and losses		(694)		(594)
Loss on extinguishment of debt		1		491
Loss on disposition of operations		74		688
Interest credited to contractholder funds		919		1,278
Changes in:
Policy benefits and other insurance reserves		541		(55)
Unearned premiums		766		602
Deferred policy acquisition costs		(220)		(268)
Premium installment receivables, net		(257)		(205)
Reinsurance recoverables, net		(1,068)		(729)
Income taxes		205		573
Other operating assets and liabilities		(247)		(187)
Net cash provided by operating activities		3,236		4,242
Cash flows from investing activities
Proceeds from sales
Fixed income securities		34,609		21,243
Equity securities		6,755		3,173
Limited partnership interests		1,473		1,045
Mortgage loans		10		24
Other investments		406		151
Investment collections
Fixed income securities		3,736		5,908
Mortgage loans		1,106		1,020
Other investments		191		275
Investment purchases
Fixed income securities		(38,759)		(24,087)
Equity securities		(5,443)		(3,677)
Limited partnership interests		(1,398)		(1,312)
Mortgage loans		(501)		(538)
Other investments		(972)		(1,084)
Change in short-term investments, net		272		(427)
Change in other investments, net		46		97
Purchases of property and equipment, net		(288)		(207)
Disposition (acquisition) of operations		378		(24)
Net cash provided by investing activities		1,621		1,580
Cash flows from financing activities
Proceeds from issuance of long-term debt		--		2,271
Repayment of long-term debt		(1,006)		(2,627)
Proceeds from issuance of preferred stock		965		781
Contractholder fund deposits		1,184		2,174
Contractholder fund withdrawals		(3,446)		(6,556)
Dividends paid on common stock		(477)		(352)
Dividends paid on preferred stock		(87)		(6)
Treasury stock purchases		(2,301)		(1,834)
Shares reissued under equity incentive plans, net		266		170
Excess tax benefits on share-based payment arrangements		41		38
Other		(14)		(12)
Net cash used in financing activities		(4,875)		(5,953)
Net decrease in cash		(18)		(131)
Cash at beginning of year		675		806
Cash at end of year	$	657	$	675

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Definitions of Non-GAAP Measures

We believe that investors’ understanding of Allstate’s performance is enhanced by our disclosure of the following non-GAAP measures. Our methods for calculating these measures may differ from those used by other companies and therefore comparability may be limited.

Operating income is net income available to common shareholders, excluding:

·realized capital gains and losses, after-tax, except for periodic settlements and accruals on non-hedge derivative instruments, which are reported with realized capital gains and losses but included in operating income,

·valuation changes on embedded derivatives that are not hedged, after-tax,

·amortization of deferred policy acquisition costs (DAC) and deferred sales inducements (DSI), to the extent they resulted from the recognition of certain realized capital gains and losses or valuation changes on embedded derivatives that are not hedged, after-tax,

·amortization of purchased intangible assets, after-tax,

·gain (loss) on disposition of operations, after-tax, and

·adjustments for other significant non-recurring, infrequent or unusual items, when (a) the nature of the charge or gain is such that it is reasonably unlikely to recur within two years, or (b) there has been no similar charge or gain within the prior two years.

Net income available to common shareholders is the GAAP measure that is most directly comparable to operating income.

We use operating income as an important measure to evaluate our results of operations. We believe that the measure provides investors with a valuable measure of the company’s ongoing performance because it reveals trends in our insurance and financial services business that may be obscured by the net effect of realized capital gains and losses, valuation changes on embedded derivatives that are not hedged, amortization of purchased intangible assets, gain (loss) on disposition of operations and adjustments for other significant non-recurring, infrequent or unusual items. Realized capital gains and losses, valuation changes on embedded derivatives that are not hedged and gain (loss) on disposition of operations may vary significantly between periods and are generally driven by business decisions and external economic developments such as capital market conditions, the timing of which is unrelated to the insurance underwriting process. Consistent with our intent to protect results or earn additional income, operating income includes periodic settlements and accruals on certain derivative instruments that are reported in realized capital gains and losses because they do not qualify for hedge accounting or are not designated as hedges for accounting purposes. These instruments are used for economic hedges and to replicate fixed income securities, and by including them in operating income, we are appropriately reflecting their trends in our performance and in a manner consistent with the economically hedged investments, product attributes (e.g. net investment income and interest credited to contractholder funds) or replicated investments. Amortization of purchased intangible assets is excluded because it relates to the acquisition purchase price and is not indicative of our underlying insurance business results or trends. Non-recurring items are excluded because, by their nature, they are not indicative of our business or economic trends. Accordingly, operating income excludes the effect of items that tend to be highly variable from period to period and highlights the results from ongoing operations and the underlying profitability of our business. A byproduct of excluding these items to determine operating income is the transparency and understanding of their significance to net income variability and profitability while recognizing these or similar items may recur in subsequent periods. Operating income is used by management along with the other components of net income available to common shareholders to assess our performance. We use adjusted measures of operating income in incentive compensation.  Therefore, we believe it is useful for investors to evaluate net income available to common shareholders, operating income and their components separately and in the aggregate when reviewing and evaluating our performance. We note that investors, financial analysts, financial and business media organizations and rating agencies utilize operating income results in their evaluation of our and our industry’s financial performance and in their investment decisions, recommendations and communications as it represents a reliable, representative and consistent measurement of the industry and the company and management’s performance. We note that the price to earnings multiple commonly used by insurance investors as a forward-looking valuation technique uses operating income as the denominator. Operating income should not be considered a substitute for net income available to common shareholders and does not reflect the overall profitability of our business.

The following tables reconcile operating income and net income available to common shareholders.

($ in millions, except per share data)		For the three months ended December 31,
		Property-Liability				Allstate Financial				Consolidated				Per diluted common share
		2014		2013		2014		2013		2014		2013		2014		2013
Operating income	$	687	$	793	$	128	$	160	$	736	$	781	$	1.72	$	1.70
Realized capital gains and losses, after-tax		(11)		86		81		9		70		94		0.16		0.21
Valuation changes on embedded derivatives that are not hedged, after-tax		--		--		(3)		(3)		(3)		(3)		(0.01)		(0.01)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		--		--		--		(3)		--		(3)		--		(0.01)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		--		--		--		--		--		--		--		--
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		2		1		--		--		2		1		0.01		--
Amortization of purchased intangible assets, after-tax		(12)		(15)		--		--		(12)		(15)		(0.03)		(0.03)
Gain (loss) on disposition of operations, after-tax		--		--		2		(44)		2		(44)		0.01		(0.10)
Loss on extinguishment of debt, after-tax		--		--		--		--		--		(1)		--		--
Postretirement benefits curtailment gain, after-tax		--		--		--		--		--		--		--		--
Net income available to common shareholders	$	666	$	865	$	208	$	119	$	795	$	810	$	1.86	$	1.76

8

($ in millions, except per share data)		For the twelve months ended December 31,
		Property-Liability				Allstate Financial				Consolidated				Per diluted common share
		2014		2013		2014		2013		2014		2013		2014		2013
Operating income	$	2,072	$	2,467	$	607	$	588	$	2,367	$	2,670	$	5.40	$	5.68
Realized capital gains and losses, after-tax		357		339		94		46		451		385		1.03		0.82
Valuation changes on embedded derivatives that are not hedged, after-tax		--		--		(15)		(16)		(15)		(16)		(0.03)		(0.03)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		--		--		(3)		(5)		(3)		(5)		(0.01)		(0.01)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		--		--		--		7		--		7		--		0.01
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		6		4		1		(11)		7		(7)		0.02		(0.01)
Amortization of purchased intangible assets, after-tax		(45)		(55)		--		--		(45)		(55)		(0.10)		(0.12)
Gain (loss) on disposition of operations, after-tax		37		(1)		(53)		(514)		(16)		(515)		(0.04)		(1.10)
Loss on extinguishment of debt, after-tax		--		--		--		--		--		(319)		--		(0.68)
Postretirement benefits curtailment gain, after-tax		--		--		--		--		--		118		--		0.25
Net income available to common shareholders	$	2,427	$	2,754	$	631	$	95	$	2,746	$	2,263	$	6.27	$	4.81

Operating income return on common shareholders’ equity is a ratio that uses a non-GAAP measure. It is calculated by dividing the rolling 12-month operating income by the average of common shareholders’ equity at the beginning and at the end of the 12-months, after excluding the effect of unrealized net capital gains and losses. Return on common shareholders’ equity is the most directly comparable GAAP measure. We use operating income as the numerator for the same reasons we use operating income, as discussed above. We use average common shareholders’ equity excluding the effect of unrealized net capital gains and losses for the denominator as a representation of common shareholders’ equity primarily attributable to the company’s earned and realized business operations because it eliminates the effect of items that are unrealized and vary significantly between periods due to external economic developments such as capital market conditions like changes in equity prices and interest rates, the amount and timing of which are unrelated to the insurance underwriting process. We use it to supplement our evaluation of net income available to common shareholders and return on common shareholders’ equity because it excludes the effect of items that tend to be highly variable from period to period. We believe that this measure is useful to investors and that it provides a valuable tool for investors when considered along with return on common shareholders’ equity because it eliminates the after-tax effects of realized and unrealized net capital gains and losses that can fluctuate significantly from period to period and that are driven by economic developments, the magnitude and timing of which are generally not influenced by management. In addition, it eliminates non-recurring items that are not indicative of our ongoing business or economic trends. A byproduct of excluding the items noted above to determine operating income return on common shareholders’ equity from return on common shareholders’ equity is the transparency and understanding of their significance to return on common shareholders’ equity variability and profitability while recognizing these or similar items may recur in subsequent periods. We use adjusted measures of operating income return on common shareholders’ equity in incentive compensation. Therefore, we believe it is useful for investors to have operating income return on common shareholders’ equity and return on common shareholders’ equity when evaluating our performance. We note that investors, financial analysts, financial and business media organizations and rating agencies utilize operating income return on common shareholders’ equity results in their evaluation of our and our industry’s financial performance and in their investment decisions, recommendations and communications as it represents a reliable, representative and consistent measurement of the industry and the company and management’s utilization of capital. Operating income return on common shareholders’ equity should not be considered a substitute for return on common shareholders’ equity and does not reflect the overall profitability of our business.

9

The following tables reconcile return on common shareholders’ equity and operating income return on common shareholders’ equity.

($ in millions)		For the twelve months ended December 31,
		2014		2013
Return on common shareholders’ equity
Numerator:
Net income available to common shareholders	$	2,746	$	2,263
Denominator:
Beginning common shareholders’ equity (1)	$	20,700	$	20,580
Ending common shareholders’ equity (1)		20,558		20,700
Average common shareholders’ equity	$	20,629	$	20,640
Return on common shareholders’ equity		13.3%		11.0%
		For the twelve months ended December 31,
		2014		2013
Operating income return on common shareholders’ equity
Numerator:
Operating income	$	2,367	$	2,670
Denominator:
Beginning common shareholders’ equity	$	20,700	$	20,580
Unrealized net capital gains and losses		1,646		2,834
Adjusted beginning common shareholders’ equity		19,054		17,746
Ending common shareholders’ equity		20,558		20,700
Unrealized net capital gains and losses		1,926		1,646
Adjusted ending common shareholders’ equity		18,632		19,054
Average adjusted common shareholders’ equity	$	18,843	$	18,400
Operating income return on common shareholders’ equity		12.6%		14.5%
(1)  Excludes equity related to preferred stock of $1,746 million and $780 million as of December 31, 2014 and 2013, respectively.

Underwriting income is calculated as premiums earned, less claims and claims expense (“losses”), amortization of DAC, operating costs and expenses and restructuring and related charges as determined using GAAP. Management uses this measure in its evaluation of the results of operations to analyze the profitability of our Property-Liability insurance operations separately from investment results. It is also an integral component of incentive compensation. It is useful for investors to evaluate the components of income separately and in the aggregate when reviewing performance. Net income available to common shareholders is the most directly comparable GAAP measure. Underwriting income should not be considered a substitute for net income available to common shareholders and does not reflect the overall profitability of our business. A reconciliation of Property-Liability underwriting income to net income available to common shareholders is provided in the “Business Results” page.

10

Combined ratio excluding the effect of catastrophes, prior year reserve reestimates and amortization of purchased intangible assets (“underlying combined ratio”) is a non-GAAP ratio, which is computed as the difference between four GAAP operating ratios: the combined ratio, the effect of catastrophes on the combined ratio, the effect of prior year non-catastrophe reserve reestimates on the combined ratio, and the effect of amortization of purchased intangible assets on the combined ratio. We believe that this ratio is useful to investors and it is used by management to reveal the trends in our Property-Liability business that may be obscured by catastrophe losses, prior year reserve reestimates and amortization of purchased intangible assets. Catastrophe losses cause our loss trends to vary significantly between periods as a result of their incidence of occurrence and magnitude, and can have a significant impact on the combined ratio. Prior year reserve reestimates are caused by unexpected loss development on historical reserves. Amortization of purchased intangible assets relates to the acquisition purchase price and is not indicative of our underlying insurance business results or trends. We believe it is useful for investors to evaluate these components separately and in the aggregate when reviewing our underwriting performance. We also provide it to facilitate a comparison to our outlook on the underlying combined ratio. The most directly comparable GAAP measure is the combined ratio. The underlying combined ratio should not be considered a substitute for the combined ratio and does not reflect the overall underwriting profitability of our business.

The following table reconciles the Property-Liability underlying combined ratio to the Property-Liability combined ratio.

	Three months ended December 31,		Twelve months ended December 31,
	2014	2013	2014	2013
Combined ratio excluding the effect of catastrophes, prior year reserve reestimates and amortization of purchased intangible assets (“underlying combined ratio”)	89.5	87.5	87.2	87.3
Effect of catastrophe losses	1.3	1.7	6.9	4.5
Effect of prior year non-catastrophe reserve reestimates	(1.0)	(0.8)	(0.4)	(0.1)
Effect of amortization of purchased intangible assets	0.2	0.3	0.2	0.3
Combined ratio	90.0	88.7	93.9	92.0
Effect of prior year catastrophe reserve reestimates	--	(0.1)	0.1	(0.3)

Underwriting margin is calculated as 100% minus the combined ratio.

In this news release, we provide our outlook range on the Property-Liability 2015 underlying combined ratio. A reconciliation of this measure to the combined ratio is not possible on a forward-looking basis because it is not possible to provide a reliable forecast of catastrophes. Future prior year reserve reestimates are expected to be zero because reserves are determined based on our best estimate of ultimate loss reserves as of the reporting date.

The following table reconciles the Allstate brand underlying combined ratio to the Allstate brand combined ratio.

	Three months ended December 31,		Twelve months ended December 31,
	2014	2013	2014	2013
Underlying combined ratio	87.9	86.1	85.4	85.8
Effect of catastrophe losses	1.3	1.8	6.9	4.7
Effect of prior year non-catastrophe reserve reestimates	(0.9)	(0.6)	(0.8)	(0.6)
Combined ratio	88.3	87.3	91.5	89.9
Effect of prior year catastrophe reserve reestimates	(0.1)	--	0.1	(0.3)

The following table reconciles the Allstate brand auto underlying combined ratio to the Allstate brand auto combined ratio.

	Three months ended December 31,		Twelve months ended December 31,
	2014	2013	2014	2013
Underlying combined ratio	98.2	95.9	94.2	94.4
Effect of catastrophe losses	0.2	--	1.6	1.0
Effect of prior year non-catastrophe reserve reestimates	(1.4)	(0.6)	(1.1)	(0.9)
Combined ratio	97.0	95.3	94.7	94.5
Effect of prior year catastrophe reserve reestimates	(0.1)	(0.3)	(0.1)	(0.3)

The following table reconciles the Allstate brand homeowners underlying combined ratio to the Allstate brand homeowners combined ratio.

	Three months ended December 31,		Twelve months ended December 31,
	2014	2013	2014	2013
Underlying combined ratio	61.0	60.7	61.7	62.7
Effect of catastrophe losses	3.8	7.1	21.4	15.6
Effect of prior year non-catastrophe reserve reestimates	(1.2)	(1.2)	(0.6)	(0.4)
Combined ratio	63.6	66.6	82.5	77.9
Effect of prior year catastrophe reserve reestimates	0.1	0.9	1.0	0.4

11

The following table reconciles the Encompass brand underlying combined ratio to the Encompass brand combined ratio.

	Three months ended December 31,		Twelve months ended December 31,
	2014	2013	2014	2013
Underlying combined ratio	92.7	91.8	93.7	93.7
Effect of catastrophe losses	1.9	0.3	13.2	5.2
Effect of prior year non-catastrophe reserve reestimates	(1.5)	(6.0)	(0.8)	(3.0)
Combined ratio	93.1	86.1	106.1	95.9
Effect of prior year catastrophe reserve reestimates	0.3	(1.5)	0.1	(0.7)

Esurance brand underlying loss ratio is a non-GAAP ratio, which is computed as the difference between three GAAP operating ratios: the loss ratio, the effect of catastrophes on the combined ratio and the effect of prior year non-catastrophe reserve reestimates on the combined ratio.  We believe that this ratio is useful to investors and it is used by management to reveal the trends in the Esurance business that may be obscured by catastrophe losses and prior year reserve reestimates.  Catastrophe losses cause our loss trends to vary significantly between periods as a result of their incidence of occurrence and magnitude, and can have a significant impact on the combined ratio.  Prior year reserve reestimates are caused by unexpected loss development on historical reserves.  We believe it is useful for investors to evaluate these components separately and in the aggregate when reviewing our underwriting performance.  The most directly comparable GAAP measure is the loss ratio. The underlying loss ratio should not be considered a substitute for the loss ratio and does not reflect the overall loss ratio of our business.

The following table reconciles the Esurance brand underlying loss ratio and underlying combined ratio to the Esurance brand combined ratio.

	Three months ended December 31,		Twelve months ended December 31,
	2014	2013	2014	2013
Underlying loss ratio	80.3	79.1	76.6	77.6
Expense ratio, excluding the effect of amortization of purchased intangible assets	33.1	32.8	37.6	34.1
Underlying combined ratio	113.4	111.9	114.2	111.7
Effect of catastrophe losses	0.3	0.3	1.3	0.9
Effect of prior year non-catastrophe reserve reestimates	(1.3)	--	(1.1)	--
Effect of amortization of purchased intangible assets	3.1	4.5	3.3	4.9
Combined ratio	115.5	116.7	117.7	117.5

Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, is a ratio that uses a non-GAAP measure. It is calculated by dividing common shareholders’ equity after excluding the impact of unrealized net capital gains and losses on fixed income securities and related DAC, DSI and life insurance reserves by total common shares outstanding plus dilutive potential common shares outstanding. We use the trend in book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, in conjunction with book value per common share to identify and analyze the change in net worth attributable to management efforts between periods. We believe the non-GAAP ratio is useful to investors because it eliminates the effect of items that can fluctuate significantly from period to period and are generally driven by economic developments, primarily capital market conditions, the magnitude and timing of which are generally not influenced by management, and we believe it enhances understanding and comparability of performance by highlighting underlying business activity and profitability drivers. We note that book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, is a measure commonly used by insurance investors as a valuation technique. Book value per common share is the most directly comparable GAAP measure. Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, should not be considered a substitute for book value per common share, and does not reflect the recorded net worth of our business. The following table shows the reconciliation.

($ in millions, except per share data)		As of December 31,
		2014		2013
Book value per common share
Numerator:
Common shareholders’ equity	$	20,558	$	20,700
Denominator:
Common shares outstanding and dilutive potential common shares outstanding		426.2		456.9
Book value per common share	$	48.24	$	45.31
Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities
Numerator:
Common shareholders’ equity	$	20,558	$	20,700
Unrealized net capital gains and losses on fixed income securities		1,666		1,258
Adjusted common shareholders’ equity	$	18,892	$	19,442
Denominator:
Common shares outstanding and dilutive potential common shares outstanding		426.2		456.9
Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities	$	44.33	$	42.55

# # # # #

12

EX-99.2

Exhibit 99.2

THE ALLSTATE CORPORATION

Investor Supplement

Fourth Quarter 2014

The consolidated financial statements and financial exhibits included herein are unaudited. These consolidated financial statements and exhibits should be read in conjunction with the consolidated financial statements and notes thereto included in the most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.  The results of operations for interim periods should not be considered indicative of results to be expected for the full year.

Measures used in these financial statements and exhibits that are not based on generally accepted accounting principles ("non-GAAP") are denoted with an asterisk (*) the first time they appear.  These measures are defined on the page "Definitions of Non-GAAP Measures" and are reconciled to the most directly comparable generally accepted accounting principles ("GAAP") measure herein.

THE ALLSTATE CORPORATION

Investor Supplement - Fourth Quarter 2014

Table of Contents

	PAGE
Consolidated
Statements of Operations	1
Contribution to Income	2
Revenues	3
Statements of Financial Position	4
Book Value Per Common Share	5
Return on Common Shareholders’ Equity	6
Debt to Capital	7
Statements of Cash Flows	8
Analysis of Deferred Policy Acquisition Costs	9-10
Historical Summary of Consolidated Operating and Financial Position Data	11
Property-Liability Operations
Property-Liability Results	12
Historical Property-Liability Results	13
Underwriting Results by Area of Business	14
Historical Underwriting Results by Area of Business	15
Premiums Written by Brand	16
Impact of Net Rate Changes Approved on Premiums Written	17
Policies in Force and Other Statistics	18
Allstate Brand Profitability Measures	19
Allstate Brand Statistics	20
Esurance Brand Profitability Measures and Statistics	21
Encompass Brand Profitability Measures and Statistics	22
Auto Profitability Measures	23
Homeowners Profitability Measures	24
Other Personal Lines Profitability Measures	25
Commercial Lines Profitability Measures	26
Other Business Lines Profitability Measures	27
Auto, Homeowners and Other Personal Lines Underlying Combined Ratios	28
Allstate Brand Auto and Homeowners underlying loss and expense	29
Homeowners Supplemental Information	30
Catastrophe Losses by Brand	31
Effect of Catastrophe Losses on the Combined Ratio	32
Catastrophe by Size of Event	33
Prior Year Reserve Reestimates	34
Historical Prior Year Reserve Reestimate	35
Historical Property-Liability Loss Reserves	36
Asbestos and Environmental Reserves	37
Allstate Personal Lines - Auto, Homeowners and Other Personal Lines Profitability Measures	38
Emerging Businesses - Esurance, Encompass, Commercial Lines, Other Business Lines, and Answer Financial Profitability Measures	39
Allstate Financial Operations
Allstate Financial Results	40
Historical Allstate Financial Results	41
Impact of LBL on Comparison of Allstate Financial Results	42
Estimated Results of Disposed LBL Business	43
Return on Attributed Equity	44
Premiums and Contract Charges	45
Change in Contractholder Funds	46
Analysis of Net Income	47
Allstate Financial Weighted Average Investment Spreads	48
Allstate Financial Supplemental Product Information	49
Allstate Financial Insurance Policies and Annuities in Force	50
Allstate Life and Annuities and Allstate Benefits Results and Product Information	51
Corporate and Other Results	52
Investments
Investments	53
Investment Portfolio Details	54
Limited Partnership Investments	55
Unrealized Net Capital Gains and Losses on Security Portfolio by Type	56
Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-tax)	57
Property-Liability Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-tax)	58
Allstate Financial Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-tax)	59
Investment Results	60
Definitions of Non-GAAP Measures	61

THE ALLSTATE CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

($ in millions, except per share data)

		Three months ended																Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Revenues
Property-liability insurance premiums	$	7,354	$	7,307	$	7,204	$	7,064	$	7,014	$	6,972	$	6,862	$	6,770	$	28,929	$	27,618
Life and annuity premiums and contract charges		520		512		518		607		610		584		579		579		2,157		2,352
Net investment income		779		823		898		959		1,026		950		984		983		3,459		3,943
Realized capital gains and losses:
Total other-than-temporary impairment (“OTTI”) losses		(65)		(53)		(44)		(80)		(29)		(96)		(55)		(27)		(242)		(207)
OTTI losses reclassified to (from) other comprehensive income		(1)		-		(1)		(1)		(1)		8		(5)		(10)		(3)		(8)
Net OTTI losses recognized in earnings		(66)		(53)		(45)		(81)		(30)		(88)		(60)		(37)		(245)		(215)
Sales and other realized capital gains and losses		172		347		285		135		172		47		422		168		939		809
Total realized capital gains and losses		106		294		240		54		142		(41)		362		131		694		594
Total revenues		8,759		8,936		8,860		8,684		8,792		8,465		8,787		8,463		35,239		34,507
Costs and expenses
Property-liability insurance claims and claims expense		4,618		4,909		5,142		4,759		4,283		4,427		4,741		4,460		19,428		17,911
Life and annuity contract benefits		431		433		413		488		490		498		471		458		1,765		1,917
Interest credited to contractholder funds		202		198		212		307		305		317		311		345		919		1,278
Amortization of deferred policy acquisition costs		1,035		1,030		1,035		1,035		1,069		1,026		961		946		4,135		4,002
Operating costs and expenses		1,156		1,068		1,023		1,094		1,258		937		1,090		1,102		4,341		4,387
Restructuring and related charges		5		3		4		6		11		13		20		26		18		70
Loss on extinguishment of debt		-		-		1		-		2		9		480		-		1		491
Interest expense		73		78		84		87		87		83		99		98		322		367
Total costs and expenses		7,520		7,719		7,914		7,776		7,505		7,310		8,173		7,435		30,929		30,423
Gain (loss) on disposition of operations		3		(27)		9		(59)		(44)		(646)		-		2		(74)		(688)
Income from operations before income tax expense		1,242		1,190		955		849		1,243		509		614		1,030		4,236		3,396
Income tax expense		418		409		310		249		422		193		180		321		1,386		1,116
Net income	$	824	$	781	$	645	$	600	$	821	$	316	$	434	$	709	$	2,850	$	2,280
Preferred stock dividends		29		31		31		13		11		6		-		-		104		17
Net income available to common shareholders	$	795	$	750	$	614	$	587	$	810	$	310	$	434	$	709	$	2,746	$	2,263
Earnings per common share: (1)
Net income available to common shareholders per common share - Basic	$	1.89	$	1.77	$	1.41	$	1.31	$	1.79	$	0.67	$	0.93	$	1.49	$	6.37	$	4.87
Weighted average common shares - Basic		420.2		424.5		434.3		446.4		452.8		461.1		468.3		475.4		431.4		464.4
Net income available to common shareholders per common share - Diluted	$	1.86	$	1.74	$	1.39	$	1.30	$	1.76	$	0.66	$	0.92	$	1.47	$	6.27	$	4.81
Weighted average common shares - Diluted		427.7		431.2		440.7		452.8		459.6		467.1		473.8		480.8		438.2		470.3
Cash dividends declared per common share	$	0.28	$	0.28	$	0.28	$	0.28	$	0.25	$	0.25	$	0.25	$	0.25	$	1.12	$	1.00

(1) In accordance with GAAP, the quarter and year-to-date per share amounts are calculated discretely.  Therefore, the sum of each quarter may not equal the year-to-date amount.

1

THE ALLSTATE CORPORATION

CONTRIBUTION TO INCOME

($ in millions, except per share data)

		Three months ended																Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Contribution to income
Operating income before the impact of restructuring and related charges	$	740	$	599	$	448	$	592	$	789	$	721	$	542	$	664	$	2,379	$	2,716
Restructuring and related charges, after-tax		(4)		(1)		(3)		(4)		(8)		(8)		(13)		(17)		(12)		(46)
Operating income *		736		598		445		588		781		713		529		647		2,367		2,670
Realized capital gains and losses, after-tax		70		192		154		35		94		(28)		234		85		451		385
Valuation changes on embedded derivatives that are not hedged, after-tax		(3)		2		(3)		(11)		(3)		(10)		3		(6)		(15)		(16)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		-		(3)		-		-		(3)		1		(4)		1		(3)		(5)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		-		-		-		-		7		-		-		-		7
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		2		-		3		2		1		-		(3)		(5)		7		(7)
Amortization of purchased intangible assets, after-tax		(12)		(11)		(11)		(11)		(15)		(13)		(13)		(14)		(45)		(55)
Gain (loss) on disposition of operations, after-tax		2		(28)		26		(16)		(44)		(472)		-		1		(16)		(515)
Loss on extinguishment of debt, after-tax		-		-		-		-		(1)		(6)		(312)		-		-		(319)
Postretirement benefits curtailment gain, after-tax		-		-		-		-		-		118		-		-		-		118
Net income available to common shareholders	$	795	$	750	$	614	$	587	$	810	$	310	$	434	$	709	$	2,746	$	2,263
Income per common share - Diluted (1)
Operating income before the impact of restructuring and related charges	$	1.73	$	1.39	$	1.02	$	1.31	$	1.72	$	1.54	$	1.14	$	1.38	$	5.43	$	5.78
Restructuring and related charges, after-tax		(0.01)		-		(0.01)		(0.01)		(0.02)		(0.01)		(0.02)		(0.03)		(0.03)		(0.10)
Operating income		1.72		1.39		1.01		1.30		1.70		1.53		1.12		1.35		5.40		5.68
Realized capital gains and losses, after-tax		0.16		0.45		0.35		0.08		0.21		(0.06)		0.50		0.18		1.03		0.82
Valuation changes on embedded derivatives that are not hedged, after-tax		(0.01)		-		(0.01)		(0.02)		(0.01)		(0.02)		0.01		(0.02)		(0.03)		(0.03)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		-		(0.01)		-		-		(0.01)		-		(0.01)		-		(0.01)		(0.01)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		-		-		-		-		0.01		-		-		-		0.01
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		0.01		-		0.01		-		-		-		(0.01)		(0.01)		0.02		(0.01)
Amortization of purchased intangible assets, after-tax		(0.03)		(0.03)		(0.03)		(0.02)		(0.03)		(0.03)		(0.03)		(0.03)		(0.10)		(0.12)
Gain (loss) on disposition of operations, after-tax		0.01		(0.06)		0.06		(0.04)		(0.10)		(1.01)		-		-		(0.04)		(1.10)
Loss on extinguishment of debt, after-tax		-		-		-		-		-		(0.01)		(0.66)		-		-		(0.68)
Postretirement benefits curtailment gain, after-tax		-		-		-		-		-		0.25		-		-		-		0.25
Net income available to common shareholders	$	1.86	$	1.74	$	1.39	$	1.30	$	1.76	$	0.66	$	0.92	$	1.47	$	6.27	$	4.81
Weighted average common shares - Diluted		427.7		431.2		440.7		452.8		459.6		467.1		473.8		480.8		438.2		470.3

(1)In accordance with GAAP, the quarter and year-to-date per share amounts are calculated discretely.  Therefore, the sum of each quarter may not equal the year-to-date amount.

2

THE ALLSTATE CORPORATION

REVENUES

($ in millions)

		Three months ended																Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Property-Liability
Property-Liability insurance premiums	$	7,354	$	7,307	$	7,204	$	7,064	$	7,014	$	6,972	$	6,862	$	6,770	$	28,929	$	27,618
Net investment income		294		344		351		312		382		309		343		341		1,301		1,375
Realized capital gains and losses		(20)		266		250		53		128		(26)		305		112		549		519
Total Property-Liability revenues		7,628		7,917		7,805		7,429		7,524		7,255		7,510		7,223		30,779		29,512
Allstate Financial
Life and annuity premiums and contract charges		520		512		518		607		610		584		579		579		2,157		2,352
Net investment income		480		473		538		640		637		633		633		635		2,131		2,538
Realized capital gains and losses		125		28		(10)		1		14		(16)		57		19		144		74
Total Allstate Financial revenues		1,125		1,013		1,046		1,248		1,261		1,201		1,269		1,233		4,432		4,964
Corporate and Other
Service fees (1)		1		1		1		2		3		3		2		1		5		9
Net investment income		5		6		9		7		7		8		8		7		27		30
Realized capital gains and losses		1		-		-		-		-		1		-		-		1		1
Total Corporate and Other revenues before reclassification of services fees		7		7		10		9		10		12		10		8		33		40
Reclassification of service fees (1)		(1)		(1)		(1)		(2)		(3)		(3)		(2)		(1)		(5)		(9)
Total Corporate and Other revenues		6		6		9		7		7		9		8		7		28		31
Consolidated revenues	$	8,759	$	8,936	$	8,860	$	8,684	$	8,792	$	8,465	$	8,787	$	8,463	$	35,239	$	34,507

(1)For presentation in the Consolidated Statements of Operations, service fees of the Corporate and Other segment are reclassified to Operating costs and expenses.

3

THE ALLSTATE CORPORATION

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

($ in millions)

		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,			Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,
		2014		2014		2014		2014		2013			2014		2014		2014		2014		2013
Assets											Liabilities
Investments											Reserve for property-liability insurance claims and claims expense	$	22,923	$	22,350	$	22,317	$	21,985	$	21,857
Fixed income securities, at fair value											Reserve for life-contingent contract benefits		12,380		12,482		12,688		12,435		12,386
(amortized cost $59,672, $59,616,											Contractholder funds		22,529		22,848		23,472		23,989		24,304
$59,447, $58,587 and $59,008)	$	62,440	$	62,313	$	62,634	$	61,161	$	60,910	Unearned premiums		11,655		11,728		11,217		10,821		10,932
Equity securities, at fair value											Claim payments outstanding		784		814		851		785		631
(cost $3,692, $3,877, $4,658,											Deferred income taxes		715		1,076		1,146		886		635
$4,575 and $4,473)		4,104		4,335		5,394		5,297		5,097	Other liabilities and accrued expenses		5,653		4,967		5,044		5,566		5,156
Mortgage loans		4,188		4,143		4,174		4,472		4,721	Long-term debt		5,194		5,195		5,846		6,200		6,201
Limited partnership interests		4,527		4,348		4,309		5,024		4,967	Separate Accounts		4,396		4,521		4,780		4,878		5,039
Short-term, at fair value											Liabilities held for sale		-		-		-		14,641		14,899
(amortized cost $2,540, $2,463,											Total liabilities		86,229		85,981		87,361		102,186		102,040
$2,914, $2,573 and $2,393)		2,540		2,463		2,914		2,573		2,393
Other		3,314		3,119		3,138		3,163		3,067
Total investments		81,113		80,721		82,563		81,690		81,155
											Equity
											Preferred stock and additional capital paid-in, 72.2 thousand, 72.2 thousand, 72.2 thousand, 62.2 thousand and 32.3 thousand outstanding		1,746		1,746		1,746		1,505		780
											Common stock, 418 million, 419 million, 434 million, 434 million and 449 million shares outstanding		9		9		9		9		9
											Additional capital paid-in		3,199		3,059		3,035		3,017		3,143
											Retained income		37,842		37,164		36,532		36,041		35,580
											Deferred ESOP expense		(23)		(31)		(31)		(31)		(31)
											Treasury stock, at cost (482 million, 481 million, 466 million, 466 million and 451 million)		(21,030)		(20,856)		(19,985)		(19,922)		(19,047)
											Accumulated other comprehensive income:
											Unrealized net capital gains and losses:
											Unrealized net capital gains and losses on fixed income
											securities with other-than-temporary impairments		72		70		72		66		50
Cash		657		885		889		1,170		675	Other unrealized net capital gains and losses		1,988		1,970		2,461		2,271		1,698
Premium installment receivables, net		5,465		5,604		5,384		5,271		5,237	Unrealized adjustment to DAC, DSI and insurance
Deferred policy acquisition costs		3,525		3,516		3,377		3,316		3,372	reserves		(134)		(213)		(383)		(246)		(102)
Reinsurance recoverables, net (1)		8,490		7,555		7,500		7,512		7,621	Total unrealized net capital gains and losses		1,926		1,827		2,150		2,091		1,646
Accrued investment income		591		595		611		610		624	Unrealized foreign currency translation
Property and equipment, net		1,031		1,012		990		1,024		1,024	adjustments		(2)		18		35		22		38
Goodwill		1,219		1,219		1,219		1,243		1,243	Unrecognized pension and other
Other assets		2,046		2,682		2,920		2,187		1,937	postretirement benefit cost		(1,363)		(607)		(619)		(627)		(638)
Separate Accounts		4,396		4,521		4,780		4,878		5,039	Total accumulated other comprehensive
Assets held for sale		-		-		-		15,390		15,593	income		561		1,238		1,566		1,486		1,046
											Total shareholders’ equity		22,304		22,329		22,872		22,105		21,480
Total assets	$	108,533	$	108,310	$	110,233	$	124,291	$	123,520	Total liabilities and shareholders’ equity	$	108,533	$	108,310	$	110,233	$	124,291	$	123,520

(1)Reinsurance recoverables of unpaid losses related to Property-Liability were $5,694 million, $4,764 million, $4,695 million, $4,671 million and $4,664 million as of December 31, 2014, September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, respectively. The increase in reinsurance recoverables as of December 31, 2014 primarily relates to reserve increases for Michigan unlimited personal injury protection covered by the Michigan Catastrophic Claim Association.

4

THE ALLSTATE CORPORATION

BOOK VALUE PER COMMON SHARE

($ in millions, except per share data )

		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2014		2014		2014		2014		2013		2013		2013		2013
Book value per common share
Numerator:
Common shareholders’ equity (1)	$	20,558	$	20,583	$	21,126	$	20,600	$	20,700	$	20,130	$	19,591	$	20,619
Denominator:
Common shares outstanding and dilutive potential common shares outstanding		426.2		426.3		440.4		441.1		456.9		462.9		470.6		474.4
Book value per common share	$	48.24	$	48.28	$	47.97	$	46.70	$	45.31	$	43.49	$	41.63	$	43.46
Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities *
Numerator:
Common shareholders’ equity	$	20,558	$	20,583	$	21,126	$	20,600	$	20,700	$	20,130	$	19,591	$	20,619
Unrealized net capital gains and losses on fixed income securities		1,666		1,541		1,690		1,640		1,258		1,445		1,489		2,486
Adjusted common shareholders’ equity	$	18,892	$	19,042	$	19,436	$	18,960	$	19,442	$	18,685	$	18,102	$	18,133
Denominator:
Common shares outstanding and dilutive potential common shares outstanding		426.2		426.3		440.4		441.1		456.9		462.9		470.6		474.4
Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities	$	44.33	$	44.67	$	44.13	$	42.98	$	42.55	$	40.37	$	38.47	$	38.22

(1)Excludes equity related to preferred stock of $1,746 million, $1,746 million, $1,746 million, $1,505 million, $780 million, $650 million and $278 million as of December 31, 2014, September 30, 2014, June 30, 2014, March 31, 2014, December 31, 2013, September 30, 2013 and June 30, 2013, respectively.

5

THE ALLSTATE CORPORATION

RETURN ON COMMON SHAREHOLDERS’ EQUITY

($ in millions)

	Twelve months ended
		Dec. 31,			Sept. 30			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2014			2014			2014			2014			2013			2013			2013			2013
Return on Common Shareholders’ Equity
Numerator:
Net income available to common shareholders (1)	$	2,746		$	2,761		$	2,321		$	2,141		$	2,263		$	1,847		$	2,260		$	2,249
Denominator:
Beginning common shareholders’ equity	$	20,700		$	20,130		$	19,591		$	20,619		$	20,580		$	20,837		$	19,475		$	19,182
Ending common shareholders’ equity		20,558			20,583			21,126			20,600			20,700			20,130			19,591			20,619
Average common shareholders’ equity(2)	$	20,629		$	20,357		$	20,359		$	20,610		$	20,640		$	20,484		$	19,533		$	19,901
Return on common shareholders’ equity		13.3	%		13.6	%		11.4	%		10.4	%		11.0	%		9.0	%		11.6	%		11.3	%
Operating Income Return on Common Shareholders’ Equity *
Numerator:
Operating income (1)	$	2,367		$	2,412		$	2,527		$	2,611		$	2,670		$	2,178		$	2,182		$	2,085
Denominator:
Beginning common shareholders’ equity	$	20,700		$	20,130		$	19,591		$	20,619		$	20,580		$	20,837		$	19,475		$	19,182
Unrealized net capital gains and losses		1,646			1,714			1,651			2,905			2,834			2,880			2,070			1,874
Adjusted beginning common shareholders’ equity		19,054			18,416			17,940			17,714			17,746			17,957			17,405			17,308
Ending common shareholders’ equity		20,558			20,583			21,126			20,600			20,700			20,130			19,591			20,619
Unrealized net capital gains and losses		1,926			1,827			2,150			2,091			1,646			1,714			1,651			2,905
Adjusted ending common shareholders’ equity		18,632			18,756			18,976			18,509			19,054			18,416			17,940			17,714
Average adjusted common shareholders’ equity (2)	$	18,843		$	18,586		$	18,458		$	18,112		$	18,400		$	18,187		$	17,673		$	17,511
Operating income return on common shareholders’ equity		12.6	%		13.0	%		13.7	%		14.4	%		14.5	%		12.0	%		12.3	%		11.9	%

(1)Net income available to common shareholders and operating income reflect a trailing twelve-month period.

(2)Average common shareholders’ equity and average adjusted common shareholders’ equity are determined using a two-point average, with the beginning and ending common shareholders’ equity and adjusted common shareholders’ equity, respectively, for the twelve-month period as data points.

6

THE ALLSTATE CORPORATION

DEBT TO CAPITAL

($ in millions)

		Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2014			2014			2014			2014			2013			2013			2013			2013
Debt
Short-term debt	$	-		$	-		$	-		$	-		$	-		$	-		$	500		$	-
Long-term debt		5,194			5,195			5,846			6,200			6,201			6,217			5,475			6,556
Total debt	$	5,194		$	5,195		$	5,846		$	6,200		$	6,201		$	6,217		$	5,975		$	6,556
Capital resources
Debt	$	5,194		$	5,195		$	5,846		$	6,200		$	6,201		$	6,217		$	5,975		$	6,556
Shareholders’ equity
Preferred stock and additional capital paid-in		1,746			1,746			1,746			1,505			780			650			278			-
Common stock		9			9			9			9			9			9			9			9
Additional capital paid-in		3,199			3,059			3,035			3,017			3,143			3,127			3,105			3,028
Retained income		37,842			37,164			36,532			36,041			35,580			34,885			34,691			34,375
Deferred ESOP expense		(23)			(31)			(31)			(31)			(31)			(39)			(39)			(39)
Treasury stock		(21,030)			(20,856)			(19,985)			(19,922)			(19,047)			(18,662)			(18,225)			(18,033)
Unrealized net capital gains and losses		1,926			1,827			2,150			2,091			1,646			1,714			1,651			2,905
Unrealized foreign currency translation adjustments		(2)			18			35			22			38			50			37			58
Unrecognized pension and other postretirement benefit cost		(1,363)			(607)			(619)			(627)			(638)			(954)			(1,638)			(1,684)
Total shareholders’ equity		22,304			22,329			22,872			22,105			21,480			20,780			19,869			20,619
Total capital resources	$	27,498		$	27,524		$	28,718		$	28,305		$	27,681		$	26,997		$	25,844		$	27,175
Ratio of debt to shareholders’ equity		23.3	%		23.3	%		25.6	%		28.0	%		28.9	%		29.9	%		30.1	%		31.8	%
Ratio of debt to capital resources		18.9	%		18.9	%		20.4	%		21.9	%		22.4	%		23.0	%		23.1	%		24.1	%

7

THE ALLSTATE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	824	$	781	$	645	$	600	$	821	$	316	$	434	$	709	$	2,850	$	2,280
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and other non-cash items		89		88		91		98		122		66		93		87		366		368
Realized capital gains and losses		(106)		(294)		(240)		(54)		(142)		41		(362)		(131)		(694)		(594)
Loss on extinguishment of debt		-		-		1		-		2		9		480		-		1		491
Gain (loss) on disposition of operations		(3)		27		(9)		59		44		646		-		(2)		74		688
Interest credited to contractholder funds		202		198		212		307		305		317		311		345		919		1,278
Changes in:
Policy benefits and other insurance reserves		491		(53)		121		(18)		732		(180)		(93)		(514)		541		(55)
Unearned premiums		(56)		535		379		(92)		(68)		505		311		(146)		766		602
Deferred policy acquisition costs		(31)		(112)		(80)		3		(60)		(101)		(77)		(30)		(220)		(268)
Premium installment receivables, net		129		(234)		(106)		(46)		95		(219)		(59)		(22)		(257)		(205)
Reinsurance recoverables, net		(958)		(71)		6		(45)		(1,023)		(33)		(79)		406		(1,068)		(729)
Income taxes		30		370		(127)		(68)		118		172		6		277		205		573
Other operating assets and liabilities		60		129		(166)		(270)		225		(21)		(152)		(239)		(247)		(187)
Net cash provided by operating activities		671		1,364		727		474		1,171		1,518		813		740		3,236		4,242
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales
Fixed income securities		6,961		13,443		7,722		6,483		5,889		4,893		4,987		5,474		34,609		21,243
Equity securities		1,492		2,519		1,416		1,328		942		489		1,532		210		6,755		3,173
Limited partnership interests		389		282		564		238		369		238		278		160		1,473		1,045
Mortgage loans		-		-		-		10		4		-		18		2		10		24
Other investments		114		211		51		30		58		55		23		15		406		151
Investment collections
Fixed income securities		949		1,057		881		849		1,029		1,221		1,913		1,745		3,736		5,908
Mortgage loans		238		142		402		324		237		308		238		237		1,106		1,020
Other investments		33		51		57		50		62		42		117		54		191		275
Investment purchases
Fixed income securities		(8,109)		(14,848)		(9,550)		(6,252)		(7,442)		(6,008)		(4,553)		(6,084)		(38,759)		(24,087)
Equity securities		(1,235)		(1,540)		(1,338)		(1,330)		(1,112)		(555)		(1,693)		(317)		(5,443)		(3,677)
Limited partnership interests		(506)		(239)		(376)		(277)		(401)		(434)		(222)		(255)		(1,398)		(1,312)
Mortgage loans		(283)		(109)		(107)		(2)		(115)		(109)		(239)		(75)		(501)		(538)
Other investments		(320)		(257)		(152)		(243)		(204)		(342)		(342)		(196)		(972)		(1,084)
Change in short-term investments, net		7		325		(249)		189		117		(121)		385		(808)		272		(427)
Change in other investments, net		(12)		9		13		36		5		1		57		34		46		97
Purchases of property and equipment, net		(81)		(83)		(69)		(55)		(91)		(73)		17		(60)		(288)		(207)
Disposition and acquisition of operations		-		-		380		(2)		-		(24)		-		-		378		(24)
Net cash (used in) provided by investing activities		(363)		963		(355)		1,376		(653)		(419)		2,516		136		1,621		1,580
CASH FLOWS FROM FINANCING ACTIVITIES
Change in short-term debt		-		-		-		-		-		(500)		500		-		-		-
Proceeds from issuance of long-term debt		-		-		-		-		4		786		989		492		-		2,271
Repayment of long-term debt		-		(651)		(354)		(1)		(22)		(65)		(2,540)		-		(1,006)		(2,627)
Proceeds from issuance of preferred stock		-		-		240		725		130		373		278		-		965		781
Contractholder fund deposits		258		260		263		403		566		489		528		591		1,184		2,174
Contractholder fund withdrawals		(615)		(909)		(838)		(1,084)		(1,098)		(1,185)		(3,014)		(1,259)		(3,446)		(6,556)
Dividends paid on common stock		(117)		(122)		(125)		(113)		(115)		(118)		(119)		-		(477)		(352)
Dividends paid on preferred stock		(31)		(31)		(13)		(12)		(6)		-		-		-		(87)		(6)
Treasury stock purchases		(112)		(932)		(142)		(1,115)		(449)		(488)		(158)		(739)		(2,301)		(1,834)
Shares reissued under equity incentive plans, net		62		55		72		77		62		48		43		17		266		170
Excess tax benefits on share-based payment arrangements		19		4		5		13		5		4		6		23		41		38
Other		-		(5)		(3)		(6)		(2)		5		(28)		13		(14)		(12)
Net cash used in financing activities		(536)		(2,331)		(895)		(1,113)		(925)		(651)		(3,515)		(862)		(4,875)		(5,953)
Cash classified as held for sale		-		-		242		(242)		13		(13)		-		-		-		-
NET (DECREASE) INCREASE IN CASH		(228)		(4)		(281)		495		(394)		435		(186)		14		(18)		(131)
CASH AT BEGINNING OF PERIOD		885		889		1,170		675		1,069		634		820		806		675		806
CASH AT END OF PERIOD	$	657	$	885	$	889	$	1,170	$	675	$	1,069	$	634	$	820	$	657	$	675

8

THE ALLSTATE CORPORATION

ANALYSIS OF DEFERRED POLICY ACQUISITION COSTS

($ in millions)

	Change in Deferred Policy Acquisition Costs For the three months ended December 31, 2014
								Amortization
								relating to realized
								capital gains and		Amortization
								losses and		(acceleration)		Effect of
		Beginning		Acquisition		Amortization		valuation changes on		deceleration		unrealized		Ending
		balance		costs		before		embedded derivatives		for the changes		capital gains		balance
		Sept. 30, 2014		deferred		adjustments (1) (2)		that are not hedged (2)		in assumptions(2)		and losses		Dec. 31, 2014
Property-Liability	$	1,804	$	989	$	(973)	$	-	$	-	$	-	$	1,820
Allstate Financial:
Traditional life and accident and health		738		46		(31)		-		-		-		753
Interest-sensitive life		927		29		(28)		(3)		-		(20)		905
Fixed annuity		47		-		(1)		1		-		-		47
Subtotal		1,712		75		(60)		(2)		-		(20)		1,705
Consolidated	$	3,516	$	1,064	$	(1,033)	$	(2)	$	-	$	(20)	$	3,525
	Change in Deferred Policy Acquisition Costs For the three months ended December 31, 2013
								Amortization
								relating to realized
								capital gains and		Amortization
								losses and		(acceleration)		Effect of
		Total DAC including		Acquisition		Amortization		valuation changes on		deceleration		unrealized		DAC classified		Ending
		those classified		costs		before		embedded derivatives		for the changes		capital gains		as held for sale		balance
		as held for sale		deferred		adjustments (1) (2)		that are not hedged (2)		in assumptions(2)		and losses		ending balance		Dec. 31, 2013
Property-Liability	$	1,577	$	1,032	$	(984)	$	-	$	-	$	-	$	-	$	1,625
Allstate Financial:
Traditional life and accident and health		695		46		(29)		-		-		-		(1)		711
Interest-sensitive life		974		43		(49)		(4)		-		27		-		991
Fixed annuity		40		7		(2)		(1)		-		2		(1)		45
Subtotal		1,709		96		(80)		(5)		-		29		(2)		1,747
Consolidated	$	3,286	$	1,128	$	(1,064)	$	(5)	$	-	$	29	$	(2)	$	3,372

(1)Amortization before adjustments reflects total DAC amortization before amortization/accretion related to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged and amortization acceleration/deceleration for changes in assumptions.

(2)Included as a component of amortization of DAC on the Consolidated Statements of Operations.

9

THE ALLSTATE CORPORATION

ANALYSIS OF DEFERRED POLICY ACQUISITION COSTS

($ in millions)

		Change in Deferred Policy Acquisition Costs																				Reconciliation of Deferred Policy
		For the twelve months ended December 31, 2014																				Acquisition Costs as of December 31, 2014
												Amortization
												relating to realized
												capital gains and		Amortization								DAC before				DAC after
				DAC classified								losses and		(acceleration)		Effect of						impact of		Impact of		impact of
		Beginning		as held for sale		Total DAC including		Acquisition		Amortization		valuation changes on		deceleration		unrealized		DAC sold in		Ending		unrealized		unrealized		unrealized
		balance		beginning		those classified		costs		before		embedded derivatives		for changes in		capital gains		LBL		balance		capital gains		capital gains		capital gains
		Dec. 31, 2013		balance		as held for sale		deferred		adjustments (1) (2)		that are not hedged (2)		assumptions (2)		and losses		disposition		Dec. 31, 2014		and losses		and losses		and losses
Property-Liability	$	1,625	$	-	$	1,625	$	4,070	$	(3,875)	$	-	$	-	$	-	$	-	$	1,820	$	1,820	$	-	$	1,820
Allstate Financial:
Traditional life and accident and health		711		13		724		167		(125)		-		-		-		(13)		753		753		-		753
Interest-sensitive life		991		700		1,691		113		(130)		(8)		10		(97)		(674)		905		1,070		(165)		905
Fixed annuity		45		30		75		-		(8)		3		(2)		(1)		(20)		47		52		(5)		47
Subtotal		1,747		743		2,490		280		(263)		(5)		8		(98)		(707)		1,705		1,875		(170)		1,705
Consolidated	$	3,372	$	743	$	4,115	$	4,350	$	(4,138)	$	(5)	$	8	$	(98)	$	(707)	$	3,525	$	3,695	$	(170)	$	3,525
		Change in Deferred Policy Acquisition Costs																Reconciliation of Deferred Policy
		For the twelve months ended December 31, 2013																Acquisition Costs as of December 31, 2013
								Amortization
								relating to realized
								capital gains and		Amortization								DAC before				DAC after
								losses and		(acceleration)		Effect of						impact of		Impact of		impact of
		Beginning		Acquisition		Amortization		valuation changes on		deceleration		unrealized		DAC		Ending		unrealized		unrealized		unrealized
		balance		costs		before		embedded derivatives		for changes in		capital gains		classified as		balance		capital gains		capital gains		capital gains
		Dec. 31, 2012		deferred		adjustments (1) (2)		that are not hedged (2)		assumptions (2)		and losses		held for sale		Dec. 31, 2013		and losses		and losses		and losses
Property-Liability	$	1,396	$	3,903	$	(3,674)	$	-	$	-	$	-	$	-	$	1,625	$	1,625	$	-	$	1,625
Allstate Financial:
Traditional life and accident and health		671		164		(111)		-		-		-		(13)		711		711		-		711
Interest-sensitive life		1,529		176		(174)		(6)		(35)		201		(700)		991		1,084		(93)		991
Fixed annuity		25		24		(13)		(1)		12		28		(30)		45		51		(6)		45
Subtotal		2,225		364		(298)		(7)		(23)		229		(743)		1,747		1,846		(99)		1,747
Consolidated	$	3,621	$	4,267	$	(3,972)	$	(7)	$	(23)	$	229	$	(743)	$	3,372	$	3,471	$	(99)	$	3,372

(1)Amortization before adjustments reflects total DAC amortization before amortization/accretion related to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged and amortization acceleration/deceleration for changes in assumptions.

(2)Included as a component of amortization of DAC on the Consolidated Statements of Operations.

10

THE ALLSTATE CORPORATION

HISTORICAL CONSOLIDATED OPERATING

AND FINANCIAL POSITION DATA

($ in millions except per share data)

		As of or for the Year Ended December 31,
		2014		2013		2012		2011		2010
Consolidated statement of operations data:
Insurance premiums and contract charges	$	31,086	$	29,970	$	28,978	$	28,180	$	28,125
Net investment income		3,459		3,943		4,010		3,971		4,102
Realized capital gains and losses		694		594		327		503		(827)
Total revenues	$	35,239	$	34,507	$	33,315	$	32,654	$	31,400
Operating income	$	2,367	$	2,670	$	2,148	$	662	$	1,506
Realized capital gains and losses, after-tax		451		385		216		324		(537)
Valuation changes on embedded derivatives that are not hedged, after-tax		(15)		(16)		82		(12)		-
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(3)		(5)		(42)		(108)		(29)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		7		4		3		(12)
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		7		(7)		(33)		(35)		(29)
Business combination expenses and the amortization of purchased intangible assets, after-tax		(45)		(55)		(81)		(42)		-
(Loss) gain on disposition of operations, after-tax		(16)		(515)		12		(5)		12
Loss on extinguishment of debt, after-tax		-		(319)		-		-		-
Postretirement benefits curtailment gain, after-tax		-		118		-		-		-
Net income available to common shareholders	$	2,746	$	2,263	$	2,306	$	787	$	911
Income per common share - Diluted
Operating income	$	5.40	$	5.68	$	4.36	$	1.27	$	2.78
Realized capital gains and losses, after-tax		1.03		0.82		0.44		0.62		(0.99)
Valuation changes on embedded derivatives that are not hedged, after-tax		(0.03)		(0.03)		0.17		(0.02)		-
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(0.01)		(0.01)		(0.09)		(0.21)		(0.05)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		0.01		0.01		-		(0.02)
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		0.02		(0.01)		(0.07)		(0.07)		(0.06)
Business combination expenses and the amortization of purchased intangible assets, after-tax		(0.10)		(0.12)		(0.16)		(0.08)		-
(Loss) gain on disposition of operations, after-tax		(0.04)		(1.10)		0.02		(0.01)		0.02
Loss on extinguishment of debt, after-tax		-		(0.68)		-		-		-
Postretirement benefits curtailment gain, after-tax		-		0.25		-		-		-
Net income available to common shareholders	$	6.27	$	4.81	$	4.68	$	1.50	$	1.68
Net income available to common shareholders per share - Basic	$	6.37	$	4.87	$	4.71	$	1.51	$	1.69
Consolidated statement of financial position data:
Investments	$	81,113	$	81,155	$	97,278	$	95,618	$	100,483
Total assets		108,533		123,520		126,947		125,193		130,500
Reserves for claims and claims expense, life-contingent contract benefits and contractholder funds		57,832		58,547		75,502		77,113		81,113
Debt		5,194		6,201		6,057		5,908		5,908
Shareholders’ equity		22,304		21,480		20,580		18,298		18,617
Book value per share		48.24		45.31		42.39		36.18		34.58
Operating ratio:
Annual statutory premiums written to surplus ratio (U.S. property-liability operations)		1.8x		1.6x		1.6x		1.6x		1.6x
Other operating data:
Total employees (1)		40,200		39,400		38,500		37,300		35,200
Total Allstate agencies (1)(2)		11,900		11,600		11,200		11,900		13,400

(1)Rounded to the nearest hundred.

(2)Total Allstate agencies represents exclusive Allstate agencies and financial representatives in the United States and Canada.

11

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY RESULTS

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Premiums written	$	7,292	$	7,806	$	7,547	$	6,969	$	6,950	$	7,438	$	7,151	$	6,625	$	29,614	$	28,164
Decrease (increase) in unearned premiums		74		(512)		(397)		112		84		(518)		(293)		155		(723)		(572)
Other		(12)		13		54		(17)		(20)		52		4		(10)		38		26
Premiums earned		7,354		7,307		7,204		7,064		7,014		6,972		6,862		6,770		28,929		27,618
Claims and claims expense		(4,618)		(4,909)		(5,142)		(4,759)		(4,283)		(4,427)		(4,741)		(4,460)		(19,428)		(17,911)
Amortization of deferred policy acquisition costs		(973)		(972)		(969)		(961)		(984)		(929)		(890)		(871)		(3,875)		(3,674)
Operating costs and expenses		(1,021)		(948)		(901)		(968)		(942)		(910)		(943)		(957)		(3,838)		(3,752)
Restructuring and related charges		(5)		(4)		(3)		(4)		(11)		(9)		(19)		(24)		(16)		(63)
Underwriting income *		737		474		189		372		794		697		269		458		1,772		2,218
Net investment income		294		344		351		312		382		309		343		341		1,301		1,375
Periodic settlements and accruals on non-hedge derivative instruments		(2)		(1)		(3)		(3)		(2)		(2)		(2)		(1)		(9)		(7)
Amortization of purchased intangible assets		17		17		17		17		23		21		20		21		68		85
Income tax expense on operations		(359)		(281)		(190)		(230)		(404)		(340)		(197)		(263)		(1,060)		(1,204)
Operating income		687		553		364		468		793		685		433		556		2,072		2,467
Realized capital gains and losses, after-tax		(11)		173		161		34		86		(17)		197		73		357		339
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		2		-		2		2		1		1		1		1		6		4
Amortization of purchased intangible assets, after-tax		(12)		(11)		(11)		(11)		(15)		(13)		(13)		(14)		(45)		(55)
(Gain) loss on disposition of operations, after-tax		-		(1)		38		-		-		-		(1)		-		37		(1)
Net income available to common shareholders	$	666	$	714	$	554	$	493	$	865	$	656	$	617	$	616	$	2,427	$	2,754
Catastrophe losses	$	95	$	517	$	936	$	445	$	117	$	128	$	647	$	359	$	1,993	$	1,251
Operating ratios
Claims and claims expense (“loss”) ratio		62.8		67.2		71.4		67.4		61.1		63.5		69.1		65.9		67.2		64.9
Expense ratio		27.2		26.3		26.0		27.3		27.6		26.5		27.0		27.3		26.7		27.1
Combined ratio		90.0		93.5		97.4		94.7		88.7		90.0		96.1		93.2		93.9		92.0
Combined ratio excluding the effect of catastrophes *		88.7		86.4		84.4		88.4		87.0		88.2		86.7		87.9		87.0		87.5
Effect of catastrophe losses on combined ratio		1.3		7.1		13.0		6.3		1.7		1.8		9.4		5.3		6.9		4.5
Combined ratio		90.0		93.5		97.4		94.7		88.7		90.0		96.1		93.2		93.9		92.0
Combined ratio excluding the effect of catastrophes, prior year reserve reestimates and amortization of purchased intangible assets (“underlying combined ratio”)		89.5		86.1		84.7		88.4		87.5		86.9		86.9		87.7		87.2		87.3
Effect of catastrophe losses on combined ratio		1.3		7.1		13.0		6.3		1.7		1.8		9.4		5.3		6.9		4.5
Effect of prior year reserve reestimates on combined ratio		(1.0)		0.1		(0.1)		(0.2)		(0.9)		0.5		(0.8)		(0.6)		(0.3)		(0.4)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio		-		-		(0.5)		-		0.1		0.5		0.3		0.5		(0.1)		0.3
Effect of amortization of purchased intangible assets on combined ratio		0.2		0.2		0.3		0.2		0.3		0.3		0.3		0.3		0.2		0.3
Combined ratio		90.0		93.5		97.4		94.7		88.7		90.0		96.1		93.2		93.9		92.0
Effect of restructuring and related charges on combined ratio		0.1		0.1		-		0.1		0.2		0.1		0.3		0.4		0.1		0.2
Effect of Discontinued Lines and Coverages on combined ratio		0.1		1.4		0.1		-		-		1.9		0.1		-		0.4		0.5

12

THE ALLSTATE CORPORATION

HISTORICAL PROPERTY-LIABILITY RESULTS

($ in millions)

		Twelve months ended December 31,
		2014		2013		2012		2011		2010
Premiums written	$	29,614	$	28,164	$	27,027	$	25,980	$	25,907
(Increase) decrease in unearned premium		(723)		(572)		(322)		(33)		19
Other		38		26		32		(5)		31
Premiums earned		28,929		27,618		26,737		25,942		25,957
Claims and claims expense		(19,428)		(17,911)		(18,484)		(20,161)		(18,951)
Amortization of deferred policy acquisition costs		(3,875)		(3,674)		(3,483)		(3,477)		(3,517)
Operating costs and expenses		(3,838)		(3,752)		(3,536)		(3,143)		(2,962)
Restructuring and related charges		(16)		(63)		(34)		(43)		(33)
Underwriting income (loss)		1,772		2,218		1,200		(882)		494
Net investment income		1,301		1,375		1,326		1,201		1,189
Periodic settlement and accruals on non-hedge derivative instruments		(9)		(7)		(6)		(15)		(7)
Business combination expenses and the amortization of purchased intangible assets		68		85		124		49		-
Income tax (expense) benefit on operations		(1,060)		(1,204)		(819)		18		(423)
Operating income		2,072		2,467		1,825		371		1,253
Realized capital gains and losses, after-tax		357		339		221		54		(207)
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		6		4		3		10		4
Business combination expenses and the amortization of purchased intangible assets, after-tax		(45)		(55)		(81)		(32)		-
Gain (loss) on disposition of operations, after-tax		37		(1)		-		-		3
Net income	$	2,427	$	2,754	$	1,968	$	403	$	1,053
Catastrophe losses	$	1,993	$	1,251	$	2,345	$	3,815	$	2,207
Operating ratios
Loss ratio		67.2		64.9		69.1		77.7		73.0
Expense ratio		26.7		27.1		26.4		25.7		25.1
Combined ratio		93.9		92.0		95.5		103.4		98.1
Combined ratio excluding the effect of catastrophes		87.0		87.5		86.7		88.7		89.6
Effect of catastrophe losses on combined ratio		6.9		4.5		8.8		14.7		8.5
Combined ratio		93.9		92.0		95.5		103.4		98.1
Underlying combined ratio		87.2		87.3		87.2		89.3		89.6
Effect of catastrophe losses on combined ratio		6.9		4.5		8.8		14.7		8.5
Effect of prior year reserve reestimates on combined ratio		(0.3)		(0.4)		(2.5)		(1.3)		(0.6)
Effect of catastrophe losses included in prior year reserve reestimate on combined ratio		(0.1)		0.3		1.5		0.5		0.6
Effect of business combination expenses and the amortization of purchased intangible assets on combined ratio		0.2		0.3		0.5		0.2		-
Combined ratio		93.9		92.0		95.5		103.4		98.1
Effect of restructuring and related charges on combined ratio		0.1		0.2		0.1		0.2		0.1
Effect of Discontinued Lines and Coverages on the combined ratio		0.4		0.5		0.2		0.1		0.1

13

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY UNDERWRITING RESULTS BY AREA OF BUSINESS

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Property-Liability Underwriting Summary
Allstate Protection	$	741	$	579	$	192	$	375	$	795	$	831	$	273	$	462	$	1,887	$	2,361
Discontinued Lines and Coverages		(4)		(105)		(3)		(3)		(1)		(134)		(4)		(4)		(115)		(143)
Underwriting income	$	737	$	474	$	189	$	372	$	794	$	697	$	269	$	458	$	1,772	$	2,218
Allstate Protection Underwriting Summary
Premiums written	$	7,292	$	7,805	$	7,547	$	6,969	$	6,950	$	7,438	$	7,151	$	6,625	$	29,613	$	28,164
Premiums earned	$	7,354	$	7,306	$	7,204	$	7,064	$	7,014	$	6,972	$	6,862	$	6,770	$	28,928	$	27,618
Claims and claims expense		(4,615)		(4,804)		(5,140)		(4,756)		(4,282)		(4,292)		(4,738)		(4,457)		(19,315)		(17,769)
Amortization of deferred policy acquisition costs		(973)		(972)		(969)		(961)		(984)		(929)		(890)		(871)		(3,875)		(3,674)
Operating costs and expenses		(1,020)		(947)		(900)		(968)		(942)		(911)		(942)		(956)		(3,835)		(3,751)
Restructuring and related charges		(5)		(4)		(3)		(4)		(11)		(9)		(19)		(24)		(16)		(63)
Underwriting income	$	741	$	579	$	192	$	375	$	795	$	831	$	273	$	462	$	1,887	$	2,361
Catastrophe losses	$	95	$	517	$	936	$	445	$	117	$	128	$	647	$	359	$	1,993	$	1,251
Operating ratios
Loss ratio		62.7		65.8		71.3		67.3		61.1		61.6		69.0		65.9		66.8		64.4
Expense ratio		27.2		26.3		26.0		27.4		27.6		26.5		27.0		27.3		26.7		27.1
Combined ratio		89.9		92.1		97.3		94.7		88.7		88.1		96.0		93.2		93.5		91.5
Effect of catastrophe losses on combined ratio		1.3		7.1		13.0		6.3		1.7		1.8		9.4		5.3		6.9		4.5
Effect of restructuring and related charges on combined ratio		0.1		0.1		-		0.1		0.2		0.1		0.3		0.4		0.1		0.2
Effect of amortization of purchased intangible assets on combined ratio		0.2		0.2		0.2		0.2		0.3		0.3		0.3		0.3		0.2		0.3
Discontinued Lines and Coverages Underwriting Summary
Premiums written	$	-	$	1	$	-	$	-	$	-	$	-	$	-	$	-	$	1	$	-
Premiums earned	$	-	$	1	$	-	$	-	$	-	$	-	$	-	$	-	$	1	$	-
Claims and claims expense		(3)		(105)		(2)		(3)		(1)		(135)		(3)		(3)		(113)		(142)
Operating costs and expenses		(1)		(1)		(1)		-		-		1		(1)		(1)		(3)		(1)
Underwriting loss	$	(4)	$	(105)	$	(3)	$	(3)	$	(1)	$	(134)	$	(4)	$	(4)	$	(115)	$	(143)
Effect of Discontinued Lines and Coverages on the Property-Liability combined ratio		0.1		1.4		0.1		-		-		1.9		0.1		-		0.4		0.5
Underwriting Income (Loss) by Brand
Allstate brand	$	782	$	676	$	299	$	478	$	814	$	871	$	346	$	520	$	2,235	$	2,551
Esurance brand		(59)		(62)		(45)		(93)		(56)		(54)		(61)		(47)		(259)		(218)
Encompass brand		22		(31)		(59)		(8)		41		19		(7)		(6)		(76)		47
Answer Financial		(4)		(4)		(3)		(2)		(4)		(5)		(5)		(5)		(13)		(19)
Underwriting income	$	741	$	579	$	192	$	375	$	795	$	831	$	273	$	462	$	1,887	$	2,361

14

THE ALLSTATE CORPORATION

HISTORICAL PROPERTY-LIABILITY

UNDERWRITING RESULTS BY AREA OF BUSINESS

($ in millions)

		Twelve months ended December 31,
		2014		2013		2012		2011		2010
Property-Liability Underwriting Summary
Allstate Protection	$	1,887	$	2,361	$	1,253	$	(857)	$	525
Discontinued Lines and Coverages		(115)		(143)		(53)		(25)		(31)
Underwriting income (loss)	$	1,772	$	2,218	$	1,200	$	(882)	$	494
Allstate Protection Underwriting Summary
Premiums written	$	29,613	$	28,164	$	27,026	$	25,981	$	25,906
Premiums earned	$	28,928	$	27,618	$	26,737	$	25,942	$	25,955
Claims and claims expense		(19,315)		(17,769)		(18,433)		(20,140)		(18,923)
Amortization of deferred policy acquisition costs		(3,875)		(3,674)		(3,483)		(3,477)		(3,517)
Operating costs and expenses		(3,835)		(3,751)		(3,534)		(3,139)		(2,957)
Restructuring and related charges		(16)		(63)		(34)		(43)		(33)
Underwriting income (loss)	$	1,887	$	2,361	$	1,253	$	(857)	$	525
Catastrophe losses	$	1,993	$	1,251	$	2,345	$	3,815	$	2,207
Operating ratios
Loss ratio		66.8		64.4		68.9		77.6		72.9
Expense ratio		26.7		27.1		26.4		25.7		25.1
Combined ratio		93.5		91.5		95.3		103.3		98.0
Effect of catastrophe losses on combined ratio		6.9		4.5		8.8		14.7		8.5
Effect of restructuring and related charges on combined ratio		0.1		0.2		0.1		0.2		0.1
Effect of business combination expenses and the amortization of purchased intangible assets on combined ratio		0.2		0.3		0.5		0.2		-
Discontinued Lines and Coverages Underwriting Summary
Premiums written	$	1	$	-	$	1	$	(1)	$	1
Premiums earned	$	1	$	-	$	-	$	-	$	2
Claims and claims expense		(113)		(142)		(51)		(21)		(28)
Operating costs and expenses		(3)		(1)		(2)		(4)		(5)
Underwriting loss	$	(115)	$	(143)	$	(53)	$	(25)	$	(31)
Effect of Discontinued Lines and Coverages on the Property-Liability combined ratio		0.4		0.5		0.2		0.1		0.1

15

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY PREMIUMS WRITTEN BY BRAND

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Allstate brand (1)
Auto	$	4,347	$	4,490	$	4,375	$	4,292	$	4,147	$	4,280	$	4,170	$	4,155	$	17,504	$	16,752
Homeowners		1,598		1,831		1,765		1,342		1,549		1,779		1,693		1,268		6,536		6,289
Other personal lines		376		426		416		351		368		417		406		348		1,569		1,539
Commercial lines		126		122		130		116		119		114		121		112		494		466
Other business lines		176		185		180		176		157		161		151		133		717		602
		6,623		7,054		6,866		6,277		6,340		6,751		6,541		6,016		26,820		25,648
Esurance brand
Auto		354		403		338		404		315		357		294		342		1,499		1,308
Homeowners		4		3		1		1		-		-		-		-		9		-
Other personal lines		1		2		1		1		-		1		1		-		5		2
		359		408		340		406		315		358		295		342		1,513		1,310
Encompass brand
Auto		160		178		176		151		155		172		167		147		665		641
Homeowners		123		137		136		110		115		129		120		97		506		461
Other personal lines		27		28		29		25		25		28		28		23		109		104
		310		343		341		286		295		329		315		267		1,280		1,206
Allstate Protection		7,292		7,805		7,547		6,969		6,950		7,438		7,151		6,625		29,613		28,164
Discontinued Lines and Coverages		-		1		-		-		-		-		-		-		1		-
Property-Liability	$	7,292	$	7,806	$	7,547	$	6,969	$	6,950	$	7,438	$	7,151	$	6,625	$	29,614	$	28,164
Allstate Protection
Auto	$	4,861	$	5,071	$	4,889	$	4,847	$	4,617	$	4,809	$	4,631	$	4,644	$	19,668	$	18,701
Homeowners		1,725		1,971		1,902		1,453		1,664		1,908		1,813		1,365		7,051		6,750
Other personal lines		404		456		446		377		393		446		435		371		1,683		1,645
Commercial lines		126		122		130		116		119		114		121		112		494		466
Other business lines		176		185		180		176		157		161		151		133		717		602
	$	7,292	$	7,805	$	7,547	$	6,969	$	6,950	$	7,438	$	7,151	$	6,625	$	29,613	$	28,164
(1) Canada premiums included in Allstate brand
Auto	$	200	$	233	$	250	$	180	$	199	$	225	$	245	$	184	$	863	$	853
Homeowners		53		66		63		40		50		58		59		38		222		205
Other personal lines		13		16		15		11		13		14		15		13		55		55
	$	266	$	315	$	328	$	231	$	262	$	297	$	319	$	235	$	1,140	$	1,113

16

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

IMPACT OF NET RATE CHANGES APPROVED ON PREMIUMS WRITTEN

	Three months ended				Three months ended				Three months ended
	December 31, 2014 (1)				September 30, 2014				June 30, 2014
	Number of			Location	Number of			Location	Number of				Location
	locations		Total brand (%) (4)	specific (%) (5)	locations		Total brand (%) (4)	specific (%) (5)	locations		Total brand (%) (4)		specific (%) (5)
Allstate brand
Auto (2)	14	(6)	0.7	3.4	20	(6)	0.9	3.7	25	(6)	-	(8)	(0.2)
Homeowners (3)	16	(7)	0.9	4.6	6		0.2	6.0	11	(7)	0.4		5.7
Esurance brand
Auto	7		1.4	5.3	15		0.6	3.1	15		1.7		4.4
Encompass brand
Auto	13		2.8	6.0	9		0.9	4.1	12		2.4		7.6
Homeowners	9		2.5	7.8	7		0.6	6.5	12		1.5		7.8
	Three months ended				Three months ended				Three months ended
	March 31, 2014				December 31, 2013				September 30, 2013
	Number of			Location	Number of			Location	Number of				Location
	locations		Total brand (%) (4)	specific (%) (5)	locations		Total brand (%) (4)	specific (%) (5)	locations		Total brand (%) (4)
Allstate brand
Auto (2)	19		0.8	2.5	24		0.8	2.6	12		0.7		3.1
Homeowners (3)	8	(7)	0.2	2.3	21		1.5	4.5	3		0.3		6.8
Esurance brand
Auto	17		2.2	8.2	16		1.1	5.5	14		1.1		5.2
Encompass brand
Auto	2		0.5	4.9	11		2.1	6.6	9		1.4		5.7
Homeowners	1		-	2.5	14		2.7	6.4	11		1.4		6.9

(1)Rate changes include changes approved based on our net cost of reinsurance.  These rate changes do not reflect initial rates filed for insurance subsidiaries initially writing business.  Based on historical premiums written in those states and Canadian provinces, rate changes approved for the three month period ending December 31, 2014 are estimated to total $232 million.  Rate changes do not include rating plan enhancements, including the introduction of discounts and surcharges, that result in no change in the overall rate level in the state.  Allstate Brand rate changes exclude Canada and specialty auto in periods prior to first quarter 2014.

(2)Impacts of Allstate brand auto effective rate changes as a percentage of total brand prior year-end premiums written were 0.4%, 0.2%, 1.1%, 0.5%, 0.5% and 0.7% for the three months ended December 31, 2014, September 30, 2014, June 30, 2014, March 31, 2014, December 31, 2013 and September 30, 2013, respectively.  Rate changes are included in the effective calculations in the period the rate change is effective for renewal contracts.

(3)Impacts of Allstate brand homeowners effective rate changes as a percentage of total brand prior year-end premiums written were 0.3%, 0.1%, 0.5%, 1.3%, 0.4% and 0.3% for the three months ended December 31, 2014, September 30, 2014, June 30, 2014, March 31, 2014, December 31, 2013 and September 30, 2013, respectively.

(4)Represents the impact in the states and Canadian provinces where rate changes were approved during the period as a percentage of total brand prior year-end premiums written.

(5)Represents the impact in the states and Canadian provinces where rate changes were approved during the period as a percentage of its respective total prior year-end premiums written in those same locations.

(6)Includes one, one and three Canadian provinces for auto for the three months ended December 31, 2014, September 30, 2014 and June 30, 2014, respectively.

(7)Includes one, two and one Canadian provinces for homeowners for the three months ended December 31, 2014, June 30, 2014 and March 31, 2014, respectively.

(8)Excluding Canada, Allstate Brand Auto rate change was 0.5% for the three months ended June 30, 2014.

17

THE ALLSTATE CORPORATION

POLICIES IN FORCE AND OTHER STATISTICS

		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2014		2014		2014		2014		2013		2013		2013		2013
Policies in Force (in thousands) (1)
Allstate Brand
Auto		19,916		19,751		19,605		19,413		19,362		19,247		19,155		19,020
Homeowners		6,106		6,082		6,069		6,063		6,077		6,077		6,097		6,136
Landlord		738		737		738		740		742		742		744		748
Renter		1,466		1,447		1,421		1,402		1,385		1,371		1,364		1,364
Condominium		655		652		648		646		645		641		640		639
Other		1,248		1,248		1,245		1,244		1,252		1,260		1,267		1,273
Other personal lines		4,107		4,084		4,052		4,032		4,024		4,014		4,015		4,024
Commercial lines		325		320		313		305		301		295		291		286
Other business lines		948		958		972		991		989		996		997		1,001
Excess and surplus		27		26		25		23		22		20		18		15
Total		31,429		31,221		31,036		30,827		30,775		30,649		30,573		30,482
Esurance Brand
Auto		1,424		1,410		1,399		1,375		1,286		1,254		1,207		1,151
Homeowners		10		6		2		1		-		-		-		-
Other personal lines		36		33		30		26		20		16		11		7
Total		1,470		1,449		1,431		1,402		1,306		1,270		1,218		1,158
Encompass Brand
Auto		790		792		788		778		774		767		752		737
Homeowners		365		365		364		359		356		350		341		333
Other personal lines		122		123		124		124		125		124		124		121
Total		1,277		1,280		1,276		1,261		1,255		1,241		1,217		1,191
Total Policies in Force		34,176		33,950		33,743		33,490		33,336		33,160		33,008		32,831
Other Customer Relationships
Good Hands Roadside Members (in thousands) (2)		2,055		1,996		1,871		1,734		1,585		1,439		1,272		1,099
Non-Proprietary Premiums  ($ in millions)
Ivantage (3)	$	1,422	$	1,407	$	1,391	$	1,376	$	1,360	$	1,349	$	1,321	$	1,295
Answer Financial (4)		129		134		125		139		118		122		111		126

(1)Policies in Force:  Policy counts are based on items rather than customers.  A multi-car customer would generate multiple item (policy) counts, even if all cars were insured under one policy. Allstate Dealer Services (service contracts and other products sold in conjunction with auto lending and vehicle sales transactions) and Partnership Marketing Group (roadside assistance products) statistics are not included in total policies in force since these are not meaningful.  Additionally, non-proprietary products offered by Ivantage (insurance agency) and Answer Financial (independent insurance agency) are not included.

(2)Membership provides pay on demand access to roadside services.  Fees for three months ended December 31, 2014 were $168 thousand.

(3)Represents non-proprietary premiums under management as of the end of the period related to personal and commercial line products offered by Ivantage when an Allstate product is not available. To conform to current period’s methodology changes, prior period non-proprietary premiums have been restated.

(4)Represents non-proprietary premiums written for the period. Commissions earned for the three months ended December 31, 2014 were $17.0 million.

18

THE ALLSTATE CORPORATION

ALLSTATE BRAND PROFITABILITY MEASURES

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written	$	6,623	$	7,054	$	6,866	$	6,277	$	6,340	$	6,751	$	6,541	$	6,016	$	26,820	$	25,648
Net premiums earned
Auto	$	4,376	$	4,352	$	4,297	$	4,209	$	4,186	$	4,165	$	4,133	$	4,094	$	17,234	$	16,578
Homeowners		1,625		1,616		1,594		1,580		1,574		1,568		1,525		1,516		6,415		6,183
Other personal lines (1)		390		389		387		385		384		384		380		379		1,551		1,527
Commercial lines		125		120		121		110		115		114		113		114		476		456
Other business lines (2)		140		138		131		133		126		124		115		106		542		471
Total		6,656		6,615		6,530		6,417		6,385		6,355		6,266		6,209		26,218		25,215
Incurred losses
Auto	$	3,103	$	2,964	$	3,011	$	2,858	$	2,876	$	2,857	$	2,843	$	2,774	$	11,936	$	11,350
Homeowners		634		930		1,212		994		656		645		1,084		914		3,770		3,299
Other personal lines		223		229		226		279		187		221		239		247		957		894
Commercial lines		88		72		78		81		77		70		69		61		319		277
Other business lines		65		70		64		63		58		60		49		47		262		214
Total		4,113		4,265		4,591		4,275		3,854		3,853		4,284		4,043		17,244		16,034
Expenses
Auto	$	1,140	$	1,088	$	1,089	$	1,075	$	1,114	$	1,068	$	1,069	$	1,068	$	4,392	$	4,319
Homeowners		399		382		359		385		393		379		368		376		1,525		1,516
Other personal lines		118		103		105		108		115		108		113		115		434		451
Commercial lines		41		38		35		34		37		34		33		34		148		138
Other business lines		63		63		52		62		58		42		53		53		240		206
Total		1,761		1,674		1,640		1,664		1,717		1,631		1,636		1,646		6,739		6,630
Underwriting income (loss)
Auto	$	133	$	300	$	197	$	276	$	196	$	240	$	221	$	252	$	906	$	909
Homeowners		592		304		23		201		525		544		73		226		1,120		1,368
Other personal lines		49		57		56		(2)		82		55		28		17		160		182
Commercial lines		(4)		10		8		(5)		1		10		11		19		9		41
Other business lines		12		5		15		8		10		22		13		6		40		51
Total		782		676		299		478		814		871		346		520		2,235		2,551
Loss ratio		61.8		64.5		70.3		66.6		60.4		60.6		68.4		65.1		65.8		63.6
Expense ratio		26.5		25.3		25.1		26.0		26.9		25.7		26.1		26.5		25.7		26.3
Combined ratio		88.3		89.8		95.4		92.6		87.3		86.3		94.5		91.6		91.5		89.9
Effect of catastrophe losses on combined ratio		1.3		6.9		13.1		6.4		1.8		1.7		9.8		5.5		6.9		4.7
Effect of prior year reserve reestimates on combined ratio		(1.0)		(1.3)		(0.1)		(0.2)		(0.6)		(1.4)		(0.9)		(0.6)		(0.7)		(0.9)
Effect of advertising expenses on combined ratio		2.4		2.6		2.7		2.4		2.3		2.7		3.2		2.7		2.5		2.8
Underlying combined ratio		87.9		84.2		83.0		86.4		86.1		85.4		85.4		86.2		85.4		85.8
Effect of catastrophe losses		1.3		6.9		13.1		6.4		1.8		1.7		9.8		5.5		6.9		4.7
Effect of prior year non-catastrophe reserve reestimates		(0.9)		(1.3)		(0.7)		(0.2)		(0.6)		(0.8)		(0.7)		(0.1)		(0.8)		(0.6)
Combined ratio		88.3		89.8		95.4		92.6		87.3		86.3		94.5		91.6		91.5		89.9

(1)Other personal lines include renter, condominium, landlord and other personal lines.

(2)Other business lines include Allstate Roadside Services, Allstate Dealer Services and other business lines.

19

THE ALLSTATE CORPORATION

ALLSTATE BRAND STATISTICS (1)

	Three months ended									Twelve months ended
		Dec. 31,	Sept. 30,	June 30,	March 31,	Dec. 31,	Sept. 30,	June 30,	March 31,	Dec. 31,	Dec. 31,
		2014	2014	2014	2014	2013	2013	2013	2013	2014	2013
New Issued Applications (in thousands) (2)
Auto		740	809	770	714	664	720	709	656	3,033	2,749
Homeowners		178	201	192	154	157	180	167	121	725	625
Average Premium - Gross Written ($) (3)
Auto		486	481	478	473	473	467	466	464	479	468
Homeowners		1,144	1,144	1,135	1,137	1,126	1,119	1,109	1,104	1,140	1,115
Average Premium - Net Earned ($) (4)
Auto		444	443	441	435	434	433	433	430	441	433
Homeowners		1,060	1,054	1,045	1,034	1,029	1,024	990	976	1,048	1,005
Renewal Ratio (%) (5)
Auto		88.6	88.9	89.1	89.0	88.7	88.7	88.6	88.4	88.9	88.6
Homeowners		88.6	88.6	88.3	88.2	88.1	88.0	87.5	87.2	88.4	87.7
Bodily Injury Claim Frequency (6)
(% change year-over-year)
Auto		4.0	(1.3)	(2.8)	(0.3)	(1.7)	0.8	(1.1)	(2.4)	-	(1.1)
Property Damage Claim Frequency (6)
(% change year-over-year)
Auto		0.5	(1.0)	(2.4)	5.1	1.4	0.6	(0.3)	(0.7)	0.5	0.3
Auto Paid Severity
(% change year-over-year)
Bodily injury		6.0	2.2	1.3	0.7	2.0	2.3	4.1	6.7	2.7	3.8
Property damage		3.9	5.5	4.4	2.7	3.2	0.8	3.7	(0.2)	4.1	1.8
Homeowners Excluding Catastrophe Losses
(% change year-over-year)
Claim frequency		(4.1)	(5.5)	2.3	6.1	(2.2)	(1.1)	0.6	1.2	(0.3)	(0.3)
Claim severity		8.1	9.2	5.5	8.3	0.2	(2.2)	1.3	(0.2)	7.7	(0.2)

(1)Statistics presented for Allstate brand exclude excess and surplus lines.

(2)New Issued Applications:  Item counts of automobiles or homeowners insurance applications for insurance policies that were issued during the period, regardless of whether the customer was previously insured by another Allstate Protection brand.  Does not include automobiles that are added by existing customers.

(3)Average Premium - Gross Written:  Gross premiums written divided by issued item count.  Gross premiums written include the impacts from discounts, surcharges and ceded reinsurance premiums and exclude the impacts from mid-term premium adjustments and premium refund accruals.  Average premiums represent the appropriate policy term for each line, which is 6 months for auto and 12 months for homeowners.

(4)Average Premium - Net Earned:  Earned premium divided by average policies in force for the period.  Earned premium includes the impacts from mid-term premium adjustments and ceded reinsurance, but does not include impacts of premium refund accruals.  Average premiums represent the appropriate policy term for each line, which is 6 months for auto and 12 months for homeowners.

(5)  Renewal ratio:  Renewal policies issued during the period, based on contract effective dates, divided by the total policies issued 6 months prior for auto or 12 months prior for homeowners.

(6)  Allstate experienced geographically wide spread increases in frequency in the first two months of fourth quarter 2014.

20

THE ALLSTATE CORPORATION

ESURANCE PROFITABILITY MEASURES AND STATISTICS

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written	$	359	$	408	$	340	$	406	$	315	$	358	$	295	$	342	$	1,513	$	1,310
Net premiums earned
Auto	$	378	$	370	$	365	$	342	$	334	$	322	$	308	$	281	$	1,455	$	1,245
Homeowners		2		1		-		-		-		-		-		-		3		-
Other personal lines		1		2		1		1		1		-		1		-		5		2
		381		373		366		343		335		322		309		281		1,463		1,247
Incurred losses
Auto	$	300	$	283	$	275	$	260	$	266	$	251	$	246	$	215	$	1,118	$	978
Homeowners		1		1		-		-		-		-		-		-		2		-
Other personal lines		1		1		1		-		-		-		1		-		3		1
		302		285		276		260		266		251		247		215		1,123		979
Expenses
Auto	$	136	$	148	$	135	$	174	$	123	$	125	$	122	$	113	$	593	$	483
Homeowners		-		-		-		-		-		-		-		-		-		-
Other personal lines		2		2		-		2		2		-		1		-		6		3
		138		150		135		176		125		125		123		113		599		486
Underwriting loss
Auto	$	(58)	$	(61)	$	(45)	$	(92)	$	(55)	$	(54)	$	(60)	$	(47)	$	(256)	$	(216)
Homeowners		1		-		-		-		-		-		-		-		1		-
Other personal lines		(2)		(1)		-		(1)		(1)		-		(1)		-		(4)		(2)
		(59)		(62)		(45)		(93)		(56)		(54)		(61)		(47)		(259)		(218)
Loss ratio		79.3		76.4		75.4		75.8		79.4		78.0		79.9		76.5		76.8		78.5
Expense ratio		36.2		40.2		36.9		51.3		37.3		38.8		39.8		40.2		40.9		39.0
Combined ratio		115.5		116.6		112.3		127.1		116.7		116.8		119.7		116.7		117.7		117.5
Underlying loss ratio *		80.3		75.3		74.1		76.4		79.1		77.4		78.3		75.4		76.6		77.6
Expense ratio, excluding the effect of amortization of purchased intangible assets		33.1		37.0		33.6		47.8		32.8		34.1		34.6		34.9		37.6		34.1
Underlying combined ratio		113.4		112.3		107.7		124.2		111.9		111.5		112.9		110.3		114.2		111.7
Effect of catastrophe losses on combined ratio		0.3		1.9		2.7		0.3		0.3		0.6		1.6		1.1		1.3		0.9
Effect of prior year reserve reestimates on combined ratio		(1.3)		(0.8)		(1.4)		(0.9)		-		-		-		-		(1.1)		-
Effect of amortization of purchased intangible assets on combined ratio		3.1		3.2		3.3		3.5		4.5		4.7		5.2		5.3		3.3		4.9
Effect of advertising expenses on combined ratio		11.8		15.8		14.5		28.3		12.8		14.6		16.2		16.0		17.4		14.8
Underlying combined ratio		113.4		112.3		107.7		124.2		111.9		111.5		112.9		110.3		114.2		111.7
Effect of catastrophe losses		0.3		1.9		2.7		0.3		0.3		0.6		1.6		1.1		1.3		0.9
Effect of prior year non-catastrophe reserve reestimates		(1.3)		(0.8)		(1.4)		(0.9)		-		-		-		-		(1.1)		-
Effect of amortization of purchased intangible assets		3.1		3.2		3.3		3.5		4.5		4.7		5.2		5.3		3.3		4.9
Combined ratio		115.5		116.6		112.3		127.1		116.7		116.8		119.7		116.7		117.7		117.5
Policies in Force (in thousands)
Auto		1,424		1,410		1,399		1,375		1,286		1,254		1,207		1,151		1,424		1,286
Homeowners		10		6		2		1		-		-		-		-		10		-
Other personal lines		36		33		30		26		20		16		11		7		36		20
		1,470		1,449		1,431		1,402		1,306		1,270		1,218		1,158		1,470		1,306
New Issued Applications (in thousands)
Auto		168		181		177		221		162		188		175		222		747		747
Homeowners		4		5		1		1		-		-		-		-		11		-
Other personal lines		10		9		10		10		7		7		6		5		39		20
		182		195		188		232		169		195		181		227		797		767
Average Premium - Gross Written ($)
Auto		500		499		497		504		483		480		481		494		499		485
Homeowners		781		829		822		691		752		-		-		-		811		-
Renewal Ratio (%)
Auto		79.4		78.4		80.1		80.4		80.1		79.9		81.7		81.2		79.5		80.7

21

THE ALLSTATE CORPORATION

ENCOMPASS BRAND PROFITABILITY MEASURES AND STATISTICS

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written	$	310	$	343	$	341	$	286	$	295	$	329	$	315	$	267	$	1,280	$	1,206
Net premiums earned
Auto	$	164	$	168	$	162	$	161	$	155	$	158	$	158	$	155	$	655	$	626
Homeowners		126		123		120		117		114		111		105		100		486		430
Other personal lines		27		27		26		26		25		26		24		25		106		100
Total		317		318		308		304		294		295		287		280		1,247		1,156
Incurred losses
Auto	$	126	$	131	$	134	$	114	$	114	$	112	$	117	$	117	$	505	$	460
Homeowners		56		103		118		86		48		63		69		62		363		242
Other personal lines		18		20		21		21		-		13		21		20		80		54
Total		200		254		273		221		162		188		207		199		948		756
Expenses
Auto	$	48	$	50	$	50	$	48	$	49	$	47	$	48	$	47	$	196	$	191
Homeowners		38		37		37		35		35		34		33		32		147		134
Other personal lines		9		8		7		8		7		7		6		8		32		28
Total		95		95		94		91		91		88		87		87		375		353
Underwriting income (loss)
Auto	$	(10)	$	(13)	$	(22)	$	(1)	$	(8)	$	(1)	$	(7)	$	(9)	$	(46)	$	(25)
Homeowners		32		(17)		(35)		(4)		31		14		3		6		(24)		54
Other personal lines		-		(1)		(2)		(3)		18		6		(3)		(3)		(6)		18
Total		22		(31)		(59)		(8)		41		19		(7)		(6)		(76)		47
Loss ratio		63.1		79.8		88.7		72.7		55.1		63.7		72.1		71.1		76.0		65.4
Expense ratio		30.0		29.9		30.5		29.9		31.0		29.9		30.3		31.0		30.1		30.5
Combined ratio		93.1		109.7		119.2		102.6		86.1		93.6		102.4		102.1		106.1		95.9
Effect of catastrophe losses on combined ratio		1.9		16.4		23.7		11.2		0.3		5.8		10.1		4.6		13.2		5.2
Effect of prior year reserve reestimates on combined ratio		(1.2)		(1.9)		1.0		(0.7)		(7.5)		(5.1)		(1.4)		(0.7)		(0.7)		(3.7)
Effect of advertising expenses on combined ratio		0.3		-		0.6		0.7		0.3		-		0.7		0.7		0.4		0.4
Underlying combined ratio		92.7		95.6		94.8		91.8		91.8		92.5		92.7		97.9		93.7		93.7
Effect of catastrophe losses		1.9		16.4		23.7		11.2		0.3		5.8		10.1		4.6		13.2		5.2
Effect of prior year non-catastrophe reserve reestimates		(1.5)		(2.3)		0.7		(0.4)		(6.0)		(4.7)		(0.4)		(0.4)		(0.8)		(3.0)
Combined ratio		93.1		109.7		119.2		102.6		86.1		93.6		102.4		102.1		106.1		95.9
Policies in Force (in thousands)
Auto		790		792		788		778		774		767		752		737		790		774
Homeowners		365		365		364		359		356		350		341		333		365		356
Other personal lines		122		123		124		124		125		124		124		121		122		125
		1,277		1,280		1,276		1,261		1,255		1,241		1,217		1,191		1,277		1,255
New Issued Applications (in thousands)
Auto		28		34		40		33		36		43		41		35		135		155
Homeowners		15		18		20		17		18		22		22		17		70		79
Average Premium - Gross Written ($)
Auto		901		898		888		893		886		879		872		882		895		880
Homeowners		1,482		1,471		1,437		1,440		1,392		1,390		1,362		1,346		1,457		1,374
Renewal Ratio (%)
Auto		80.0		79.4		80.3		79.2		79.1		79.4		78.4		77.8		79.7		78.7
Homeowners		84.9		84.8		86.2		86.6		86.2		87.4		86.4		86.1		85.6		86.6

22

THE ALLSTATE CORPORATION

AUTO PROFITABILITY MEASURES

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
($ in millions)		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written
Allstate brand	$	4,347	$	4,490	$	4,375	$	4,292	$	4,147	$	4,280	$	4,170	$	4,155	$	17,504	$	16,752
Esurance brand		354		403		338		404		315		357		294		342		1,499		1,308
Encompass brand		160		178		176		151		155		172		167		147		665		641
		4,861		5,071		4,889		4,847		4,617		4,809		4,631		4,644		19,668		18,701
Net premiums earned
Allstate brand	$	4,376	$	4,352	$	4,297	$	4,209	$	4,186	$	4,165	$	4,133	$	4,094	$	17,234	$	16,578
Esurance brand		378		370		365		342		334		322		308		281		1,455		1,245
Encompass brand		164		168		162		161		155		158		158		155		655		626
		4,918		4,890		4,824		4,712		4,675		4,645		4,599		4,530		19,344		18,449
Incurred losses
Allstate brand	$	3,103	$	2,964	$	3,011	$	2,858	$	2,876	$	2,857	$	2,843	$	2,774	$	11,936	$	11,350
Esurance brand		300		283		275		260		266		251		246		215		1,118		978
Encompass brand		126		131		134		114		114		112		117		117		505		460
		3,529		3,378		3,420		3,232		3,256		3,220		3,206		3,106		13,559		12,788
Expenses
Allstate brand	$	1,140	$	1,088	$	1,089	$	1,075	$	1,114	$	1,068	$	1,069	$	1,068	$	4,392	$	4,319
Esurance brand		136		148		135		174		123		125		122		113		593		483
Encompass brand		48		50		50		48		49		47		48		47		196		191
		1,324		1,286		1,274		1,297		1,286		1,240		1,239		1,228		5,181		4,993
Underwriting income
Allstate brand	$	133	$	300	$	197	$	276	$	196	$	240	$	221	$	252	$	906	$	909
Esurance brand		(58)		(61)		(45)		(92)		(55)		(54)		(60)		(47)		(256)		(216)
Encompass brand		(10)		(13)		(22)		(1)		(8)		(1)		(7)		(9)		(46)		(25)
		65		226		130		183		133		185		154		196		604		668
Loss ratio
Allstate brand		70.9		68.1		70.1		67.9		68.7		68.6		68.8		67.7		69.2		68.5
Esurance brand		79.3		76.5		75.3		76.0		79.7		78.0		79.9		76.5		76.8		78.5
Encompass brand		76.8		78.0		82.7		70.8		73.6		70.9		74.0		75.5		77.1		73.5
Allstate Protection		71.8		69.1		70.9		68.6		69.6		69.3		69.7		68.6		70.1		69.3
Expense ratio
Allstate brand		26.1		25.0		25.3		25.5		26.6		25.6		25.9		26.1		25.5		26.0
Esurance brand		36.0		40.0		37.0		50.9		36.8		38.8		39.6		40.2		40.8		38.8
Encompass brand		29.3		29.7		30.9		29.8		31.6		29.7		30.4		30.3		29.9		30.5
Allstate Protection		26.9		26.3		26.4		27.5		27.6		26.7		27.0		27.1		26.8		27.1
Combined ratio
Allstate brand		97.0		93.1		95.4		93.4		95.3		94.2		94.7		93.8		94.7		94.5
Esurance brand		115.3		116.5		112.3		126.9		116.5		116.8		119.5		116.7		117.6		117.3
Encompass brand		106.1		107.7		113.6		100.6		105.2		100.6		104.4		105.8		107.0		104.0
Allstate Protection		98.7		95.4		97.3		96.1		97.2		96.0		96.7		95.7		96.9		96.4
Effect of catastrophe losses on combined ratio
Allstate brand		0.2		1.8		4.1		0.4		-		0.8		1.9		1.1		1.6		1.0
Esurance brand		0.3		1.9		2.7		0.3		0.3		0.6		1.6		1.1		1.3		0.9
Encompass brand		-		3.0		9.3		0.6		(0.6)		1.9		0.6		(0.6)		3.2		0.3
Effect of prior year reserve reestimates on combined ratio
Allstate brand		(1.5)		(1.8)		(0.6)		(0.9)		(0.9)		(0.8)		(1.8)		(1.6)		(1.2)		(1.2)
Esurance brand		(1.3)		(0.8)		(1.4)		(0.9)		-		-		-		-		(1.1)		-
Encompass brand		(0.6)		0.5		(3.7)		(4.3)		(4.5)		(7.6)		(3.2)		(3.9)		(2.0)		(4.8)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio
Allstate brand		(0.1)		(0.2)		(0.1)		(0.1)		(0.3)		0.1		(0.5)		(1.1)		(0.1)		(0.3)
Esurance brand		-		-		-		-		-		-		-		-		-		-
Encompass brand		-		-		(0.6)		-		-		-		(0.7)		(1.3)		(0.2)		(0.5)
Effect of amortization of purchased intangible assets on combined ratio
Esurance brand		3.1		3.2		3.3		3.5		4.5		4.7		5.2		5.3		3.3		4.9

23

THE ALLSTATE CORPORATION

HOMEOWNERS PROFITABILITY MEASURES

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
($ in millions)		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written
Allstate brand	$	1,598	$	1,831	$	1,765	$	1,342	$	1,549	$	1,779	$	1,693	$	1,268	$	6,536	$	6,289
Esurance brand		4		3		1		1		-		-		-		-		9		-
Encompass brand		123		137		136		110		115		129		120		97		506		461
		1,725		1,971		1,902		1,453		1,664		1,908		1,813		1,365		7,051		6,750
Net premiums earned
Allstate brand	$	1,625	$	1,616	$	1,594	$	1,580	$	1,574	$	1,568	$	1,525	$	1,516	$	6,415	$	6,183
Esurance brand		2		1		-		-		-		-		-		-		3		-
Encompass brand		126		123		120		117		114		111		105		100		486		430
		1,753		1,740		1,714		1,697		1,688		1,679		1,630		1,616		6,904		6,613
Incurred losses
Allstate brand	$	634	$	930	$	1,212	$	994	$	656	$	645	$	1,084	$	914	$	3,770	$	3,299
Esurance brand		1		1		-		-		-		-		-		-		2		-
Encompass brand		56		103		118		86		48		63		69		62		363		242
		691		1,034		1,330		1,080		704		708		1,153		976		4,135		3,541
Expenses
Allstate brand	$	399	$	382	$	359	$	385	$	393	$	379	$	368	$	376	$	1,525	$	1,516
Esurance brand		-		-		-		-		-		-		-		-		-		-
Encompass brand		38		37		37		35		35		34		33		32		147		134
		437		419		396		420		428		413		401		408		1,672		1,650
Underwriting income
Allstate brand	$	592	$	304	$	23	$	201	$	525	$	544	$	73	$	226	$	1,120	$	1,368
Esurance brand		1		-		-		-		-		-		-		-		1		-
Encompass brand		32		(17)		(35)		(4)		31		14		3		6		(24)		54
		625		287		(12)		197		556		558		76		232		1,097		1,422
Loss ratio
Allstate brand		39.0		57.6		76.1		62.9		41.6		41.1		71.1		60.3		58.7		53.4
Esurance brand		50.0		100.0		-		-		-		-		-		-		66.7		-
Encompass brand		44.4		83.7		98.3		73.5		42.1		56.8		65.7		62.0		74.7		56.3
Allstate Protection		39.4		59.4		77.6		63.6		41.7		42.2		70.7		60.4		59.9		53.5
Expense ratio
Allstate brand		24.6		23.6		22.5		24.4		25.0		24.2		24.1		24.8		23.8		24.5
Esurance brand		-		-		-		-		-		-		-		-		-		-
Encompass brand		30.2		30.1		30.9		29.9		30.7		30.6		31.4		32.0		30.2		31.1
Allstate Protection		24.9		24.1		23.1		24.8		25.4		24.6		24.6		25.2		24.2		25.0
Combined ratio
Allstate brand		63.6		81.2		98.6		87.3		66.6		65.3		95.2		85.1		82.5		77.9
Esurance brand		50.0		100.0		-		-		-		-		-		-		66.7		-
Encompass brand		74.6		113.8		129.2		103.4		72.8		87.4		97.1		94.0		104.9		87.4
Allstate Protection		64.3		83.5		100.7		88.4		67.1		66.8		95.3		85.6		84.1		78.5
Effect of catastrophe losses on combined ratio
Allstate brand		3.8		22.0		38.7		21.3		7.1		4.7		32.5		18.7		21.4		15.6
Encompass brand		4.8		36.6		46.7		25.6		1.8		13.5		23.8		12.0		28.2		12.6
Effect of prior year reserve reestimates on combined ratio Allstate brand		(1.1)		(0.1)		2.1		0.8		(0.3)		(3.3)		1.0		2.6		0.4		-
Encompass brand		(2.4)		(6.5)		6.7		4.3		(4.4)		-		(1.0)		1.0		0.4		(1.2)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio
Allstate brand		0.1		0.7		2.4		0.6		0.9		(2.1)		1.0		2.0		1.0		0.4
Encompass brand		0.8		0.9		1.7		(0.8)		(2.6)		(0.9)		(1.9)		-		0.7		(1.3)

24

THE ALLSTATE CORPORATION

OTHER PERSONAL LINES PROFITABILITY MEASURES (1)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
($ in millions)		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written
Allstate brand	$	376	$	426	$	416	$	351	$	368	$	417	$	406	$	348	$	1,569	$	1,539
Esurance brand		1		2		1		1		-		1		1		-		5		2
Encompass brand		27		28		29		25		25		28		28		23		109		104
		404		456		446		377		393		446		435		371		1,683		1,645
Net premiums earned
Allstate brand	$	390	$	389	$	387	$	385	$	384	$	384	$	380	$	379	$	1,551	$	1,527
Esurance brand		1		2		1		1		1		-		1		-		5		2
Encompass brand		27		27		26		26		25		26		24		25		106		100
		418		418		414		412		410		410		405		404		1,662		1,629
Incurred losses
Allstate brand	$	223	$	229	$	226	$	279	$	187	$	221	$	239	$	247	$	957	$	894
Esurance brand		1		1		1		-		-		-		1		-		3		1
Encompass brand		18		20		21		21		-		13		21		20		80		54
		242		250		248		300		187		234		261		267		1,040		949
Expenses
Allstate brand	$	118	$	103	$	105	$	108	$	115	$	108	$	113	$	115	$	434	$	451
Esurance brand		2		2		-		2		2		-		1		-		6		3
Encompass brand		9		8		7		8		7		7		6		8		32		28
		129		113		112		118		124		115		120		123		472		482
Underwriting income
Allstate brand	$	49	$	57	$	56	$	(2)	$	82	$	55	$	28	$	17	$	160	$	182
Esurance brand		(2)		(1)		-		(1)		(1)		-		(1)		-		(4)		(2)
Encompass brand		-		(1)		(2)		(3)		18		6		(3)		(3)		(6)		18
		47		55		54		(6)		99		61		24		14		150		198
Loss ratio
Allstate brand		57.2		58.9		58.4		72.5		48.7		57.6		62.9		65.2		61.7		58.6
Esurance brand		100.0		50.0		100.0		-		-		-		100.0		-		60.0		50.0
Encompass brand		66.7		74.1		80.8		80.8		-		50.0		87.5		80.0		75.5		54.0
Allstate Protection		57.9		59.8		59.9		72.8		45.6		57.1		64.4		66.1		62.6		58.3
Expense ratio
Allstate brand		30.2		26.4		27.1		28.0		29.9		28.1		29.7		30.3		28.0		29.5
Esurance brand		200.0		100.0		-		200.0		200.0		-		100.0		-		120.0		150.0
Encompass brand		33.3		29.6		26.9		30.7		28.0		26.9		25.0		32.0		30.2		28.0
Allstate Protection		30.9		27.0		27.1		28.7		30.2		28.0		29.6		30.4		28.4		29.6
Combined ratio
Allstate brand		87.4		85.3		85.5		100.5		78.6		85.7		92.6		95.5		89.7		88.1
Esurance brand		300.0		150.0		100.0		200.0		200.0		-		200.0		-		180.0		200.0
Encompass brand		100.0		103.7		107.7		111.5		28.0		76.9		112.5		112.0		105.7		82.0
Allstate Protection		88.8		86.8		87.0		101.5		75.9		85.1		94.1		96.5		91.0		87.8
Effect of catastrophe losses on combined ratio
Allstate brand		2.8		4.9		12.4		12.7		1.0		(0.3)		8.7		4.7		8.2		3.5
Esurance brand		-		-		-		-		-		-		-		-		-		-
Encompass brand		-		7.4		7.7		11.5		-		(3.8)		12.5		8.0		6.6		4.0
Effect of prior year reserve reestimates on combined ratio
Allstate brand		5.1		2.6		(3.4)		3.9		-		2.6		4.2		0.3		2.1		1.8
Esurance brand		-		-		-		-		-		-		-		-		-		-
Encompass brand		-		3.7		3.8		-		(40.0)		(11.5)		8.3		12.0		1.9		(8.0)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio
Allstate brand		-		(0.2)		(0.3)		(0.5)		(0.5)		(1.6)		(1.8)		(2.6)		(0.2)		(1.7)
Esurance brand		-		-		-		-		-		-		-		-		-		-
Encompass brand		-		-		-		-		(4.0)		0.1		-		4.0		-		-

(1)Other personal lines include renter, condominium, landlord and other personal lines.

25

THE ALLSTATE CORPORATION

COMMERCIAL LINES PROFITABILITY MEASURES (1)

	Three months ended																	Twelve months ended
		Dec.31,		Sept.30,		June30,		March31,		Dec.31,		Sept.30,		June30,		March31,		Dec.31,		Dec.31,
($ in millions)		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written	$	126	$	122	$	130	$	116	$	119	$	114	$	121	$	112	$	494	$	466
Net premiums earned	$	125	$	120	$	121	$	110	$	115	$	114	$	113	$	114	$	476	$	456
Incurred losses	$	88	$	72	$	78	$	81	$	77	$	70	$	69	$	61	$	319	$	277
Expenses	$	41	$	38	$	35	$	34	$	37	$	34	$	33	$	34	$	148	$	138
Underwriting (loss) income	$	(4)	$	10	$	8	$	(5)	$	1	$	10	$	11	$	19	$	9	$	41
Loss ratio		70.4		60.0		64.5		73.6		67.0		61.4		61.1		53.5		67.0		60.7
Expense ratio		32.8		31.7		28.9		30.9		32.1		29.8		29.2		29.8		31.1		30.3
Combined ratio		103.2		91.7		93.4		104.5		99.1		91.2		90.3		83.3		98.1		91.0
Effect of catastrophe losses on combined ratio		4.8		3.3		8.3		8.2		(1.7)		0.9		4.4		(1.8)		6.1		0.4
Effect of prior year reserve reestimates on combined ratio		(0.8)		(14.2)		(0.8)		(0.9)		0.9		(11.4)		(12.4)		(8.8)		(4.2)		(7.9)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio		-		0.7		0.1		1.0		(0.8)		0.1		(4.5)		(2.7)		0.4		(2.0)

(1)Commercial lines all represent Allstate Brand products.

26

THE ALLSTATE CORPORATION

OTHER BUSINESS LINES PROFITABILITY MEASURES (1)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
($ in millions)		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written	$	176	$	185	$	180	$	176	$	157	$	161	$	151	$	133	$	717	$	602
Net premiums earned	$	140	$	138	$	131	$	133	$	126	$	124	$	115	$	106	$	542	$	471
Incurred losses	$	65	$	70	$	64	$	63	$	58	$	60	$	49	$	47	$	262	$	214
Expenses	$	63	$	63	$	52	$	62	$	58	$	42	$	53	$	53	$	240	$	206
Underwriting income	$	12	$	5	$	15	$	8	$	10	$	22	$	13	$	6	$	40	$	51
Loss ratio		46.4		50.7		48.8		47.4		46.0		48.4		42.6		44.3		48.3		45.4
Expense ratio		45.0		45.7		39.7		46.6		46.1		33.9		46.1		50.0		44.3		43.8
Combined ratio		91.4		96.4		88.5		94.0		92.1		82.3		88.7		94.3		92.6		89.2
Effect of catastrophe losses on combined ratio		-		-		-		-		-		-		-		-		-		-
Effect of prior year reserve reestimates on combined ratio		(0.7)		-		-		-		-		-		(0.9)		(2.9)		(0.2)		(0.8)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio		-		-		-		-		-		-		-		-		-		-

(1)   Other business lines include Allstate Roadside Services, Allstate Dealer Services and other business lines, which all represent Allstate Brand products.

27

THE ALLSTATE CORPORATION

 AUTO, HOMEOWNERS AND OTHER PERSONAL LINES UNDERLYING COMBINED RATIOS

	Three months ended									Twelve months ended
		Dec. 31,	Sept. 30,	June 30,	March 31,	Dec. 31,	Sept. 30,	June 30,	March 31,	Dec. 31,	Dec. 31,
		2014	2014	2014	2014	2013	2013	2013	2013	2014	2013
Auto
Allstate brand underlying combined ratio		98.2	92.9	91.8	93.8	95.9	94.3	94.1	93.2	94.2	94.4
Effect of catastrophe losses on combined ratio		0.2	1.8	4.1	0.4	-	0.8	1.9	1.1	1.6	1.0
Effect of prior year non-catastrophe reserve reestimates on combined ratio		(1.4)	(1.6)	(0.5)	(0.8)	(0.6)	(0.9)	(1.3)	(0.5)	(1.1)	(0.9)
Allstate brand combined ratio		97.0	93.1	95.4	93.4	95.3	94.2	94.7	93.8	94.7	94.5
Esurance brand underlying combined ratio		113.2	112.2	107.7	124.0	111.7	111.5	112.7	110.3	114.1	111.5
Effect of catastrophe losses on combined ratio		0.3	1.9	2.7	0.3	0.3	0.6	1.6	1.1	1.3	0.9
Effect of prior year non-catastrophe reserve reestimates on combined ratio		(1.3)	(0.8)	(1.4)	(0.9)	-	-	-	-	(1.1)	-
Effect of amortization of purchased intangible assets on combined ratio		3.1	3.2	3.3	3.5	4.5	4.7	5.2	5.3	3.3	4.9
Esurance brand combined ratio		115.3	116.5	112.3	126.9	116.5	116.8	119.5	116.7	117.6	117.3
Encompass brand underlying combined ratio		106.7	104.2	107.4	104.3	110.3	106.3	106.3	109.0	105.6	108.0
Effect of catastrophe losses on combined ratio		-	3.0	9.3	0.6	(0.6)	1.9	0.6	(0.6)	3.2	0.3
Effect of prior year non-catastrophe reserve reestimates on combined ratio		(0.6)	0.5	(3.1)	(4.3)	(4.5)	(7.6)	(2.5)	(2.6)	(1.8)	(4.3)
Encompass brand combined ratio		106.1	107.7	113.6	100.6	105.2	100.6	104.4	105.8	107.0	104.0
Homeowners
Allstate brand underlying combined ratio		61.0	60.0	60.2	65.8	60.7	61.8	62.7	65.8	61.7	62.7
Effect of catastrophe losses on combined ratio		3.8	22.0	38.7	21.3	7.1	4.7	32.5	18.7	21.4	15.6
Effect of prior year non-catastrophe reserve reestimates on combined ratio		(1.2)	(0.8)	(0.3)	0.2	(1.2)	(1.2)	-	0.6	(0.6)	(0.4)
Allstate brand combined ratio		63.6	81.2	98.6	87.3	66.6	65.3	95.2	85.1	82.5	77.9
Encompass brand underlying combined ratio		73.0	84.6	77.5	72.7	72.8	73.0	72.4	81.0	77.0	74.7
Effect of catastrophe losses on combined ratio		4.8	36.6	46.7	25.6	1.8	13.5	23.8	12.0	28.2	12.6
Effect of prior year non-catastrophe reserve reestimates on combined ratio		(3.2)	(7.4)	5.0	5.1	(1.8)	0.9	0.9	1.0	(0.3)	0.1
Encompass brand combined ratio		74.6	113.8	129.2	103.4	72.8	87.4	97.1	94.0	104.9	87.4
Other Personal Lines
Allstate brand underlying combined ratio		79.5	77.6	76.2	83.4	77.1	81.8	77.9	87.9	79.2	81.1
Effect of catastrophe losses on combined ratio		2.8	4.9	12.4	12.7	1.0	(0.3)	8.7	4.7	8.2	3.5
Effect of prior year non-catastrophe reserve reestimates on combined ratio		5.1	2.8	(3.1)	4.4	0.5	4.2	6.0	2.9	2.3	3.5
Allstate brand combined ratio		87.4	85.3	85.5	100.5	78.6	85.7	92.6	95.5	89.7	88.1
Encompass brand underlying combined ratio		100.0	92.6	96.2	100.0	64.0	92.3	91.7	96.0	97.2	86.0
Effect of catastrophe losses on combined ratio		-	7.4	7.7	11.5	-	(3.8)	12.5	8.0	6.6	4.0
Effect of prior year non-catastrophe reserve reestimates on combined ratio		-	3.7	3.8	-	(36.0)	(11.6)	8.3	8.0	1.9	(8.0)
Encompass brand combined ratio		100.0	103.7	107.7	111.5	28.0	76.9	112.5	112.0	105.7	82.0

28

THE ALLSTATE CORPORATION

ALLSTATE BRAND AUTO AND HOMEOWNERS UNDERLYING LOSS AND EXPENSE

	Three months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2014		2014		2014		2014		2013		2013		2013		2013
Auto
Annualized average premium (1)	$	879	$	881	$	877	$	867	$	865	$	866	$	863	$	861
Underlying combined ratios		98.2		92.9		91.8		93.8		95.9		94.3		94.1		93.2
Average underlying loss (incurred pure premium) and expense *	$	863	$	818	$	805	$	813	$	830	$	817	$	812	$	802
Homeowners
Annualized average premium (1)	$	1,065	$	1,063	$	1,051	$	1,042	$	1,036	$	1,032	$	1,000	$	988
Underlying combined ratios		61.0		60.0		60.2		65.8		60.7		61.8		62.7		65.8
Average underlying loss (incurred pure premium) and expense	$	650	$	638	$	633	$	686	$	629	$	638	$	627	$	650

(1)Calculated by annualizing net earned premium reported in the quarter divided by policies in force at quarter end.

29

THE ALLSTATE CORPORATION

HOMEOWNERS SUPPLEMENTAL INFORMATION

($ in millions)

		Twelve months ended December 31, 2014
												Premium rate changes (3)
													Annual impact of
									Effect of				rate changes
		Earned		Incurred				Catastrophe	catastrophes		Number of	Number of	on state specific
Primary Exposure Groupings (1)		premiums		losses	Loss ratios			losses	on loss ratio		catastrophes	locations	premiums written
Florida	$	131	$	75	57.3	%	$	2	1.5	%
Other hurricane exposure states		3,631		2,027	55.8	%		712	19.6	%
Total hurricane exposure states (2)		3,762		2,102	55.9	%		714	19.0	%		15	3.4%
Other catastrophe exposure states (4)		3,142		2,033	64.7	%		793	25.2	%		28	7.7%
Total	$	6,904	$	4,135	59.8	%	$	1,507	21.8	%	85	43	5.1%

		2005 to 2014 Historical Information
									Effect of
		Earned		Incurred				Catastrophe	catastrophes
Primary Exposure Groupings (1)		premiums		losses	Loss ratios			losses	on loss ratio
Florida	$	1,133	$	1,054	93.0	%	$	394	34.8	%
Other hurricane exposure states		29,057		24,168	83.2	%		11,519	39.6	%
Total hurricane exposure states  (2)		30,190		25,222	83.5	%		11,913	39.5	%
Other catastrophe exposure states		26,728		18,984	71.0	%		6,699	25.1	%
Total	$	56,918	$	44,206	77.7	%	$	18,612	32.7	%

(1)Basis of Presentation

This homeowners supplemental information schedule displays financial results for the homeowners business (defined to include standard homeowners, scheduled personal property and other than primary residence lines).  Each state in which the Company writes business has been categorized into one of two exposure groupings (Hurricane or Other).   Hurricane exposure states are comprised of those states in which hurricanes are the primary catastrophe exposure. However, the catastrophe losses for these states include losses due to other kinds of catastrophes.  A catastrophe is defined by Allstate as an event that produces pre-tax losses before reinsurance in excess of $1 million, and involves multiple first party policyholders, or an event that produces a number of claims in excess of a preset per-event threshold of average claims in a specific area, occurring within a certain amount of time following the event.

(2)Hurricane exposure states include the following coastal locations:  Alabama, Connecticut, Delaware, Florida, Georgia, Louisiana, Maine, Maryland, Massachusetts, Mississippi, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Texas, Virginia and Washington, D.C.

(3)Represents the impact in the locations where rate changes were approved during the year as a percentage of total prior year-end premiums written in those locations.

(4)Includes Canada.

30

THE ALLSTATE CORPORATION

CATASTROPHE LOSSES BY BRAND

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Allstate brand
Auto	$	9	$	80	$	178	$	16	$	1	$	35	$	79	$	43	$	283	$	158
Homeowners		62		355		617		336		112		74		496		284		1,370		966
Other personal lines		11		19		48		49		4		(1)		33		18		127		54
Commercial lines		6		4		10		9		(2)		1		5		(2)		29		2
Other business lines		-		-		-		-		-		-		-		-		-		-
Total		88		458		853		410		115		109		613		343		1,809		1,180
Esurance brand
Auto		1		7		10		1		1		2		5		3		19		11
Homeowners		-		-		-		-		-		-		-		-		-		-
Other personal lines		-		-		-		-		-		-		-		-		-		-
Total		1		7		10		1		1		2		5		3		19		11
Encompass brand
Auto		-		5		15		1		(1)		3		1		(1)		21		2
Homeowners		6		45		56		30		2		15		25		12		137		54
Other personal lines		-		2		2		3		-		(1)		3		2		7		4
Total		6		52		73		34		1		17		29		13		165		60
Allstate Protection	$	95	$	517	$	936	$	445	$	117	$	128	$	647	$	359	$	1,993	$	1,251
Allstate Protection
Auto	$	10	$	92	$	203	$	18	$	1	$	40	$	85	$	45	$	323	$	171
Homeowners		68		400		673		366		114		89		521		296		1,507		1,020
Other personal lines		11		21		50		52		4		(2)		36		20		134		58
Commercial lines		6		4		10		9		(2)		1		5		(2)		29		2
Other business lines		-		-		-		-		-		-		-		-		-		-
	$	95	$	517	$	936	$	445	$	117	$	128	$	647	$	359	$	1,993	$	1,251

31

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

EFFECT OF CATASTROPHE LOSSES ON THE COMBINED RATIO

($ in millions)

											Excludes the effect of
											catastrophe losses relating to
											earthquakes and hurricanes
	Effect of all catastrophe losses on the Property-Liability						Premiums		Total		Total	Effect on the
	combined ratio						earned		catastrophe		catastrophe	Property-Liability
	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year		year-to-date		losses by year		losses by year	combined ratio
2005	2.5	2.2	69.4	9.6	21.0	$	27,039	$	5,674	$	460	1.7
2006	1.6	3.7	2.5	4.1	3.0		27,369		810		1,044	3.8
2007	2.4	6.3	5.0	7.0	5.2		27,233		1,409		1,336	4.9
2008	8.4	10.3	26.8	3.9	12.4		26,967		3,342		1,876	7.0
2009	7.8	12.5	6.2	5.0	7.9		26,194		2,069		2,159	8.2
2010	10.0	9.8	5.9	8.3	8.5		25,957		2,207		2,272	8.8
2011	5.2	36.2	16.7	1.0	14.7		25,942		3,815		3,298	12.7
2012	3.9	12.3	3.1	15.7	8.8		26,737		2,345		1,324	5.0
2013	5.3	9.4	1.8	1.7	4.5		27,618		1,251		1,352	4.9
2014	6.3	13.0	7.1	1.3	6.9		28,929		1,993		2,000	6.9
Average	5.3	11.5	14.4	5.7	9.2							6.3

32

THE ALLSTATE CORPORATION

CATASTROPHE BY SIZE OF EVENT

($ in millions)

Three months ended December 31, 2014
											Average
		Number				Claims and			Combined		catastrophe
Size of catastrophe		of events				claims expense			ratio impact		loss per event
Greater than $250 million		-	-	%	$	-	-	%	-	$	-
$101 million to $250 million		-	-			-	-		-		-
$50 million to $100 million		-	-			-	-		-		-
Less than $50 million		14	100.0			103	108.4		1.4		7
Total		14	100.0	%		103	108.4		1.4		7
Prior year reserve reestimates						(1)	(1.0)		-
Prior quarter reserve reestimates						(7)	(7.4)		(0.1)
Total catastrophe losses					$	95	100.0	%	1.3
Twelve months ended December 31, 2014
											Average
		Number				Claims and			Combined		catastrophe
Size of catastrophe		of events				claims expense			ratio impact		loss per event
Greater than $250 million		2	2.3	%	$	548	27.5	%	1.9	$	274
$101 million to $250 million		2	2.3			235	11.7		0.8		118
$50 million to $100 million		5	5.9			402	20.2		1.4		80
Less than $50 million		76	89.5			765	38.4		2.7		10
Total		85	100.0	%		1,950	97.8		6.8		23
Prior year reserve reestimates						43	2.2		0.1
Total catastrophe losses					$	1,993	100.0	%	6.9
2005 through 2014
	Principal										Average
	state with	Number				Claims and			Combined		catastrophe
Size of catastrophe	loss	of events				claims expense			ratio impact		loss per event
Greater than $250 million
Hurricane Katrina - 2005	LA				$	3,555	14.3	%	1.3	$	3,555
Sandy - 2012	NY, NJ					1,071	4.3		0.4		1,071
Hurricane Rita - 2005	TX					891	3.6		0.3		891
Hurricane Ike - 2008	TX					837	3.4		0.3		837
Hurricane Wilma - 2005	FL					514	2.1		0.2		514
May 2011 Tornados	TX, OH, MO					459	1.8		0.2		459
Hurricane Irene - 2011	NY, NJ, MD					399	1.6		0.2		399
April 27th 2011 Tornados	AL					299	1.2		0.1		299
May 20 2014 Hail	PA, IL, CO					295	1.2		0.1		295
Arizona Hail - 2010	AZ					283	1.1		0.1		283
Hurricane Gustav - 2008	LA					268	1.0		0.1		268
Jan 2nd 2014 Freeze	GA, NY, PA					253	1.0		0.1		253
Greater than $250 million		12	1.4	%		9,124	36.6		3.4		760
$101 million to $250 million		24	2.8			3,534	14.2		1.3		147
$50 million to $100 million		65	7.7			4,591	18.4		1.7		71
Less than $50 million		747	88.1			7,666	30.8		2.8		10
Total		848	100.0	%	$	24,915	100.0	%	9.2		29

33

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

EFFECT OF PRIOR YEAR RESERVE REESTIMATES ON THE COMBINED RATIO

($ in millions)

	Three months ended																									Twelve months ended
		Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Dec. 31,
		2014			2014			2014			2014			2013			2013			2013			2013			2014			2013
Prior Year Reserve Reestimates (1)
Auto	$	(75	)	$	(79	)	$	(36	)	$	(48	)	$	(44	)	$	(44	)	$	(79	)	$	(70	)	$	(238	)	$	(237	)
Homeowners		(21	)		(9	)		41			18			(10	)		(51	)		15			41			29			(5	)
Other personal lines		20			11			(12	)		15			(10	)		7			18			4			34			19
Commercial lines		(1	)		(17	)		(1	)		(1	)		1			(13	)		(14	)		(10	)		(20	)		(36	)
Other business lines		(1	)		-			-			-			-			-			(1	)		(3	)		(1	)		(4	)
Allstate Protection		(78	)		(94	)		(8	)		(16	)		(63	)		(101	)		(61	)		(38	)		(196	)		(263	)
Discontinued Lines and Coverages		2			105			2			3			1			135			3			3			112			142
Property-Liability	$	(76	)	$	11		$	(6	)	$	(13	)	$	(62	)	$	34		$	(58	)	$	(35	)	$	(84	)	$	(121	)
Allstate brand (2)	$	(69	)	$	(85	)	$	(6	)	$	(11	)	$	(41	)	$	(86	)	$	(57	)	$	(36	)	$	(171	)	$	(220	)
Esurance brand		(5	)		(3	)		(5	)		(3	)		-			-			-			-			(16	)		-
Encompass brand (2)		(4	)		(6	)		3			(2	)		(22	)		(15	)		(4	)		(2	)		(9	)		(43	)
Allstate Protection (2)	$	(78	)	$	(94	)	$	(8	)	$	(16	)	$	(63	)	$	(101	)	$	(61	)	$	(38	)	$	(196	)	$	(263	)
Effect of Prior Year Reserve Reestimates on Combined Ratio (1)(3)
Auto		(1.0	)		(1.1	)		(0.5	)		(0.7	)		(0.5	)		(0.6	)		(1.2	)		(1.0	)		(0.8	)		(0.9	)
Homeowners		(0.3	)		(0.1	)		0.6			0.3			(0.2	)		(0.7	)		0.2			0.6			0.1			-
Other personal lines		0.3			0.2			(0.2	)		0.2			(0.2	)		0.1			0.3			-			0.1			-
Commercial lines		-			(0.3	)		-			-			-			(0.2	)		(0.2	)		(0.2	)		(0.1	)		(0.1	)
Other business lines		-			-			-			-			-			-			-			-			-			-
Allstate Protection		(1.0	)		(1.3	)		(0.1	)		(0.2	)		(0.9	)		(1.4	)		(0.9	)		(0.6	)		(0.7	)		(1.0	)
Discontinued Lines and Coverages		-			1.4			-			-			-			1.9			0.1			-			0.4			0.6
Property-Liability		(1.0	)		0.1			(0.1	)		(0.2	)		(0.9	)		0.5			(0.8	)		(0.6	)		(0.3	)		(0.4	)
Allstate brand (2)		(0.9	)		(1.2	)		(0.1	)		(0.2	)		(0.6	)		(1.2	)		(0.8	)		(0.5	)		(0.6	)		(0.8	)
Esurance brand		-			-			(0.1	)		-			-			-			-			-			-			-
Encompass brand (2)		(0.1	)		(0.1	)		0.1			-			(0.3	)		(0.2	)		(0.1	)		(0.1	)		(0.1	)		(0.2	)
Allstate Protection (2)		(1.0	)		(1.3	)		(0.1	)		(0.2	)		(0.9	)		(1.4	)		(0.9	)		(0.6	)		(0.7	)		(1.0	)

(1)Favorable reserve reestimates are shown in parentheses.

(2)Unfavorable (favorable) reserve reestimates included in catastrophe losses for Allstate brand, Encompass brand and Allstate Protection totaled $(2) million, $1 million and $(1) million and $0 million, $(4) million and $(4) million, respectively, in the three months ended December 31, 2014 and 2013, respectively.  Unfavorable (favorable) reserve reestimates included in catastrophe losses for Allstate brand, Encompass brand and Allstate Protection totaled $41 million, $2 million and $43 million and $(79) million, $(9) million and $(88) million, respectively, in the twelve months ended December 31, 2014 and 2013, respectively.

(3)Calculated using Property-Liability premiums earned for the respective period.

34

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

HISTORICAL PRIOR YEAR RESERVE REESTIMATES (1)

($ in millions)

		Twelve months ended December 31,
		2014		2013		2012		2011		2010
Allstate brand	$	(171)	$	(220)	$	(671)	$	(371)	$	(181)
Esurance brand		(16)		-		-		-		-
Encompass brand		(9)		(43)		(45)		15		(6)
Allstate Protection		(196)		(263)		(716)		(356)		(187)
Discontinued Lines and Coverages		112		142		51		21		28
Property-Liability	$	(84)	$	(121)	$	(665)	$	(335)	$	(159)
Effect of Property-Liability prior year reserve reestimates on the combined ratio		(0.3)		(0.4)		(2.5)		(1.3)		(0.6)

(1)Favorable reserve reestimates are shown in parentheses.

35

THE ALLSTATE CORPORATION

HISTORICAL PROPERTY-LIABILITY LOSS RESERVES

($ in millions)

		Twelve months ended December 31,
		2014		2013		2012		2011		2010
(net of reinsurance)
Net reserve for claims and claims expense, beginning of year	$	17,193	$	17,278	$	17,787	$	17,396	$	17,028
Acquisitions		-		-		(13)		425		-
Claims and claims expense
Provision attributable to the current year		19,512		18,032		19,149		20,496		19,110
Change in provision attributable to prior years (1)		(84)		(121)		(665)		(335)		(159)
Total claims and claims expense		19,428		17,911		18,484		20,161		18,951
Payments
Claims and claims expense attributable to current year		(12,924)		(11,658)		(12,545)		(13,893)		(12,012)
Claims and claims expense attributable to prior years		(6,468)		(6,338)		(6,435)		(6,302)		(6,571)
Total payments		(19,392)		(17,996)		(18,980)		(20,195)		(18,583)
Net reserve for claims and claims expense, end of year (2)	$	17,229	$	17,193	$	17,278	$	17,787	$	17,396
Percent change in loss reserves		0.2	%	(0.5)	%	(2.9)	%	2.2	%	2.2	%
(1)Reserve reestimates due to:
Asbestos and environmental claims	$	102	$	104	$	48	$	26	$	23
All other property-liability claims		(186)		(225)		(713)		(361)		(182)
Change in pre-tax reserve	$	(84)	$	(121)	$	(665)	$	(335)	$	(159)

(2)Net reserves for claims and claims expense are net of expected reinsurance recoveries of $5.69 billion, $4.66 billion, $4.01 billion, $2.59 billion and $2.07 billion at December 31, 2014, 2013, 2012, 2011 and 2010, respectively.

36

THE ALLSTATE CORPORATION

ASBESTOS AND ENVIRONMENTAL RESERVES

($ in millions)

		Three months ended								Twelve months ended December 31,
		Dec. 31,		Sept. 30,		June 30,		March 31,
		2014		2014		2014		2014		2014		2013		2012		2011		2010		2009
(net of reinsurance)
Asbestos claims
Beginning reserves	$	1,045	$	976	$	993	$	1,017	$	1,017	$	1,026	$	1,078	$	1,100	$	1,180	$	1,228
Incurred claims and claims expense		-		87		-		-		87		74		26		26		5		(8)
Claims and claims expense paid		(31)		(18)		(17)		(24)		(90)		(83)		(78)		(48)		(85)		(40)
Ending reserves	$	1,014	$	1,045	$	976	$	993	$	1,014	$	1,017	$	1,026	$	1,078	$	1,100	$	1,180
Claims and claims expense paid as a percent of ending reserves		3.1%		1.7%		1.7%		2.4%		8.9%		8.2%		7.6%		4.5%		7.7%		3.4%
Environmental claims
Beginning reserves	$	211	$	201	$	204	$	208	$	208	$	193	$	185	$	201	$	198	$	195
Incurred claims and claims expense		-		15		-		-		15		30		22		-		18		13
Claims and claims expense paid		(8)		(5)		(3)		(4)		(20)		(15)		(14)		(16)		(15)		(10)
Ending reserves	$	203	$	211	$	201	$	204	$	203	$	208	$	193	$	185	$	201	$	198
Claims and claims expense paid as a percent of ending reserves		3.9%		2.4%		1.5%		2.0%		9.9%		7.2%		7.3%		8.6%		7.5%		5.1%

37

THE ALLSTATE CORPORATION

ALLSTATE PERSONAL LINES-AUTO, HOMEOWNERS AND OTHER PERSONAL LINES PROFITABILITY MEASURES (1)

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written
Auto	$	4,347	$	4,490	$	4,375	$	4,292	$	4,147	$	4,280	$	4,170	$	4,155	$	17,504	$	16,752
Homeowners		1,598		1,831		1,765		1,342		1,549		1,779		1,693		1,268		6,536		6,289
Landlord		140		147		137		126		138		143		135		124		550		540
Renter		64		79		72		59		58		69		59		53		274		239
Condominium		57		62		61		48		52		58		55		45		228		210
Other		115		138		146		118		120		147		157		126		517		550
Other personal lines		376		426		416		351		368		417		406		348		1,569		1,539
Total		6,321		6,747		6,556		5,985		6,064		6,476		6,269		5,771		25,609		24,580
Net premiums earned
Auto	$	4,376	$	4,352	$	4,297	$	4,209	$	4,186	$	4,165	$	4,133	$	4,094	$	17,234	$	16,578
Homeowners		1,625		1,616		1,594		1,580		1,574		1,568		1,525		1,516		6,415		6,183
Other personal lines		390		389		387		385		384		384		380		379		1,551		1,527
Total		6,391		6,357		6,278		6,174		6,144		6,117		6,038		5,989		25,200		24,288
Incurred losses
Auto	$	3,103	$	2,964	$	3,011	$	2,858	$	2,876	$	2,857	$	2,843	$	2,774	$	11,936	$	11,350
Homeowners		634		930		1,212		994		656		645		1,084		914		3,770		3,299
Other personal lines		223		229		226		279		187		221		239		247		957		894
Total		3,960		4,123		4,449		4,131		3,719		3,723		4,166		3,935		16,663		15,543
Expenses
Auto	$	1,140	$	1,088	$	1,089	$	1,075	$	1,114	$	1,068	$	1,069	$	1,068	$	4,392	$	4,319
Homeowners		399		382		359		385		393		379		368		376		1,525		1,516
Other personal lines		118		103		105		108		115		108		113		115		434		451
Total		1,657		1,573		1,553		1,568		1,622		1,555		1,550		1,559		6,351		6,286
Underwriting income (loss)
Auto	$	133	$	300	$	197	$	276	$	196	$	240	$	221	$	252	$	906	$	909
Homeowners		592		304		23		201		525		544		73		226		1,120		1,368
Other personal lines		49		57		56		(2)		82		55		28		17		160		182
Total		774		661		276		475		803		839		322		495		2,186		2,459
Loss ratio		62.0		64.9		70.9		66.9		60.5		60.9		69.0		65.7		66.1		64.0
Expense ratio		25.9		24.7		24.7		25.4		26.4		25.4		25.7		26.0		25.2		25.9
Combined ratio		87.9		89.6		95.6		92.3		86.9		86.3		94.7		91.7		91.3		89.9
Effect of catastrophe losses on combined ratio		1.3		7.1		13.4		6.5		1.9		1.8		10.1		5.8		7.1		4.9
Effect of prior year reserve reestimates on combined ratio		(1.0)		(1.1)		(0.1)		(0.2)		(0.7)		(1.2)		(0.7)		(0.4)		(0.6)		(0.7)
Underlying combined ratio		87.6		83.6		82.8		86.0		85.7		85.2		85.1		85.9		85.0		85.5
Effect of catastrophe losses		1.3		7.1		13.4		6.5		1.9		1.8		10.1		5.8		7.1		4.9
Effect of prior year non-catastrophe reserve reestimates		(1.0)		(1.1)		(0.6)		(0.2)		(0.7)		(0.7)		(0.5)		-		(0.8)		(0.5)
Combined ratio		87.9		89.6		95.6		92.3		86.9		86.3		94.7		91.7		91.3		89.9
Policies in Force (in thousands)
Auto		19,916		19,751		19,605		19,413		19,362		19,247		19,155		19,020		19,916		19,362
Homeowners		6,106		6,082		6,069		6,063		6,077		6,077		6,097		6,136		6,106		6,077
Other personal lines		4,107		4,084		4,052		4,032		4,024		4,014		4,015		4,024		4,107		4,024
Excess and surplus		27		26		25		23		22		20		18		15		27		22
Total		30,156		29,943		29,751		29,531		29,485		29,358		29,285		29,195		30,156		29,485

(1)    Allstate Personal Lines comprise Allstate brand auto, homeowners and other personal lines. Allstate Protection segment comprises Allstate Personal Lines and Emerging Businesses.

38

THE ALLSTATE CORPORATION

EMERGING BUSINESSES - ESURANCE, ENCOMPASS, COMMERCIAL LINES, OTHER BUSINESS LINES AND ANSWER FINANCIAL PROFITABILITY MEASURES

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net premiums written
Esurance	$	359	$	408	$	340	$	406	$	315	$	358	$	295	$	342	$	1,513	$	1,310
Encompass		310		343		341		286		295		329		315		267		1,280		1,206
Commercial lines		126		122		130		116		119		114		121		112		494		466
Allstate Roadside Services		86		96		94		97		88		91		88		82		373		349
Allstate Dealer Services		90		89		86		79		69		70		63		51		344		253
Other business lines		176		185		180		176		157		161		151		133		717		602
Total		971		1,058		991		984		886		962		882		854		4,004		3,584
Net premiums earned
Esurance	$	381	$	373	$	366	$	343	$	335	$	322	$	309	$	281	$	1,463	$	1,247
Encompass		317		318		308		304		294		295		287		280		1,247		1,156
Commercial lines		125		120		121		110		115		114		113		114		476		456
Other business lines		140		138		131		133		126		124		115		106		542		471
Total		963		949		926		890		870		855		824		781		3,728		3,330
Incurred losses
Esurance	$	302	$	285	$	276	$	260	$	266	$	251	$	247	$	215	$	1,123	$	979
Encompass		200		254		273		221		162		188		207		199		948		756
Commercial lines		88		72		78		81		77		70		69		61		319		277
Other business lines		65		70		64		63		58		60		49		47		262		214
Total		655		681		691		625		563		569		572		522		2,652		2,226
Expenses
Esurance	$	138	$	150	$	135	$	176	$	125	$	125	$	123	$	113	$	599	$	486
Encompass		95		95		94		91		91		88		87		87		375		353
Commercial lines		41		38		35		34		37		34		33		34		148		138
Other business lines		63		63		52		62		58		42		53		53		240		206
Answer Financial		4		4		3		2		4		5		5		5		13		19
Total		341		350		319		365		315		294		301		292		1,375		1,202
Underwriting income (loss)
Esurance	$	(59)	$	(62)	$	(45)	$	(93)	$	(56)	$	(54)	$	(61)	$	(47)	$	(259)	$	(218)
Encompass		22		(31)		(59)		(8)		41		19		(7)		(6)		(76)		47
Commercial lines		(4)		10		8		(5)		1		10		11		19		9		41
Other business lines		12		5		15		8		10		22		13		6		40		51
Answer Financial		(4)		(4)		(3)		(2)		(4)		(5)		(5)		(5)		(13)		(19)
Total		(33)		(82)		(84)		(100)		(8)		(8)		(49)		(33)		(299)		(98)
Loss ratio		68.0		71.7		74.6		70.2		64.7		66.5		69.4		66.8		71.1		66.8
Expense ratio		35.4		36.9		34.5		41.0		36.2		34.4		36.5		37.4		36.9		36.1
Combined ratio		103.4		108.6		109.1		111.2		100.9		100.9		105.9		104.2		108.0		102.9
Effect of catastrophe losses on combined ratio		1.3		6.6		10.0		4.9		-		2.3		4.7		1.8		5.7		2.2
Effect of prior year reserve reestimates on combined ratio		(1.2)		(2.7)		(0.3)		(0.7)		(2.4)		(3.3)		(2.3)		(1.9)		(1.2)		(2.5)
Effect of amortization of purchased intangible assets (1)		1.8		1.8		1.9		1.9		2.6		2.5		2.4		2.6		1.8		2.5
Underlying combined ratio		101.6		103.2		97.6		105.1		100.1		99.3		100.1		101.2		101.8		100.2
Effect of catastrophe losses		1.3		6.6		10.0		4.9		-		2.3		4.7		1.8		5.7		2.2
Effect of prior year non-catastrophe reserve reestimates		(1.3)		(3.0)		(0.4)		(0.7)		(1.8)		(3.2)		(1.3)		(1.4)		(1.3)		(2.0)
Effect of amortization of purchased intangible assets		1.8		1.8		1.9		1.9		2.6		2.5		2.4		2.6		1.8		2.5
Combined ratio		103.4		108.6		109.1		111.2		100.9		100.9		105.9		104.2		108.0		102.9
Policies in Force (in thousands)
Esurance		1,470		1,449		1,431		1,402		1,306		1,270		1,218		1,158		1,470		1,306
Encompass		1,277		1,280		1,276		1,261		1,255		1,241		1,217		1,191		1,277		1,255
Commercial lines		325		320		313		305		301		295		291		286		325		301
Other business lines		948		958		972		991		989		996		997		1,001		948		989
Total		4,020		4,007		3,992		3,959		3,851		3,802		3,723		3,636		4,020		3,851

(1)      Relates to the acquisition of Northeast Agency in 2013.

39

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL RESULTS (1)

($ in millions)

		Three months ended																								Twelve months ended
		Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Dec. 31,
		2014			2014			2014			2014			2013			2013			2013			2013			2014			2013
Premiums	$	312		$	308		$	312		$	327		$	332		$	306		$	307		$	303		$	1,259		$	1,248
Contract charges		208			204			206			280			278			278			272			276			898			1,104
Net investment income		480			473			538			640			637			633			633			635			2,131			2,538
Periodic settlements and accruals on non-hedge derivative instruments		-			-			(1	)		-			-			2			5			10			(1	)		17
Contract benefits		(431	)		(433	)		(413	)		(488	)		(490	)		(498	)		(471	)		(458	)		(1,765	)		(1,917	)
Interest credited to contractholder funds		(199	)		(200	)		(208	)		(291	)		(301	)		(302	)		(315	)		(336	)		(898	)		(1,254	)
Amortization of deferred policy acquisition costs		(60	)		(56	)		(65	)		(74	)		(80	)		(109	)		(65	)		(76	)		(255	)		(330	)
Operating costs and expenses		(121	)		(115	)		(112	)		(118	)		(145	)		(132	)		(140	)		(148	)		(466	)		(565	)
Restructuring and related charges		-			1			(1	)		(2	)		-			(4	)		(1	)		(2	)		(2	)		(7	)
Income tax expense on operations		(61	)		(57	)		(91	)		(85	)		(71	)		(47	)		(68	)		(60	)		(294	)		(246	)
Operating income		128			125			165			189			160			127			157			144			607			588
Realized capital gains and losses, after-tax		81			19			(6	)		-			9			(12	)		37			12			94			46
Valuation changes on embedded derivatives that are not hedged, after-tax		(3	)		2			(3	)		(11	)		(3	)		(10	)		3			(6	)		(15	)		(16	)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		-			(3	)		-			-			(3	)		1			(4	)		1			(3	)		(5	)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-			-			-			-			-			7			-			-			-			7
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		-			-			1			-			-			(1	)		(4	)		(6	)		1			(11	)
Gain (loss) on disposition of operations, after-tax (2)		2			(27	)		(12	)		(16	)		(44	)		(472	)		1			1			(53	)		(514	)
Net income (loss) available to common shareholders	$	208		$	116		$	145		$	162		$	119		$	(360	)	$	190		$	146		$	631		$	95

(1)Refer to pages 42 and 43 for further details related to the impact of LBL on comparison of Allstate Financial results.

(2)Included loss on disposition of LBL of $1 million, pre-tax, ($0 million, after-tax), $28 million, pre-tax, ($29 million, after-tax), $11 million, pre-tax, ($13 million, after-tax), $61 million, pre-tax, ($18 million, after-tax), $46 million, pre-tax, ($46 million, after-tax) and $652 million, pre-tax, ($475 million, after-tax) for three months ended December 31, 2014, September 30, 2014, June 30, 2014, March 31, 2014, December 31, 2013 and September 30, 2013, respectively, and $101 million, pre-tax, ($60 million, after-tax) and $698 million, pre-tax, ($521 million, after-tax) in 2014 and 2013, respectively.

40

THE ALLSTATE CORPORATION

HISTORICAL ALLSTATE FINANCIAL RESULTS

($ in millions)

	As of or for the Year Ended December 31,
			2014			2013		2012		2011		2010
Premiums		$	1,259		$	1,248	$	1,168	$	1,190	$	1,138
Contract charges			898			1,104		1,073		1,048		1,030
Net investment income			2,131			2,538		2,647		2,716		2,853
Periodic settlements and accruals on non-hedge derivative instruments			(1)			17		55		70		51
Contract benefits			(1,765)			(1,917)		(1,818)		(1,761)		(1,815)
Interest credited to contractholder funds			(898)			(1,254)		(1,434)		(1,617)		(1,798)
Amortization of deferred policy acquisition costs			(255)			(330)		(350)		(343)		(236)
Operating costs and expenses			(466)			(565)		(576)		(555)		(568)
Restructuring and related charges			(2)			(7)		-		(1)		3
Income tax expense on operations			(294)			(246)		(236)		(240)		(214)
Operating income			607			588		529		507		444
Realized capital gains and losses, after-tax			94			46		(8)		250		(337)
Valuation changes on embedded derivatives that are not hedged, after-tax			(15)			(16)		82		(12)		-
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax			(3)			(5)		(42)		(108)		(29)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax			-			7		4		3		(12)
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax			1			(11)		(36)		(45)		(33)
(Loss) gain on disposition of operations, after-tax			(53)			(514)		12		(5)		9
Net income		$	631		$	95	$	541	$	590	$	42
Life insurance in force, net of reinsurance		$	328,027	(1)	$	346,202	$	326,169	$	306,397	$	294,149

(1)   Estimated using the most available information. The decline in 2014 is related to the sale of LBL.

41

THE ALLSTATE CORPORATION

IMPACT OF LBL ON COMPARISON OF ALLSTATE FINANCIAL RESULTS (1)

($ in millions)

	Three months ended											Twelve months ended
		Dec. 31,		Dec. 31,				Q4 2013		Change		Dec. 31,		Dec. 31,				Q2-Q4 2013		Change
		2014		2013		Change		LBL results		excl.LBL		2014		2013		Change		LBL results		excl.LBL
Premiums and contract charges	$	520	$	610	$	(90)	$	89	$	(1)	$	2,157	$	2,352	$	(195)	$	254	$	59
Net investment income		480		637		(157)		126		(31)		2,131		2,538		(407)		397		(10)
Periodic settlements and accruals on non-hedge derivative instruments		-		-		-		-		-		(1)		17		(18)		-		(18)
Contract benefits		(431)		(490)		59		(46)		13		(1,765)		(1,917)		152		(173)		(21)
Interest credited to contractholder funds		(199)		(301)		102		(83)		19		(898)		(1,254)		356		(248)		108
Amortization of deferred policy acquisition costs		(60)		(80)		20		(17)		3		(255)		(330)		75		(6)		69
Operating costs and expenses		(121)		(145)		24		(7)		17		(466)		(565)		99		(31)		68
Restructuring and related charges		-		-		-		-		-		(2)		(7)		5		-		5
Income tax expense on operations		(61)		(71)		10		(21)		(11)		(294)		(246)		(48)		(66)		(114)
Operating income		128		160		(32)		41		9		607		588		19		127		146
Realized capital gains and losses, after-tax		81		9		72		-		72		94		46		48		-		48
Valuation changes on embedded derivatives that are not hedged, after-tax		(3)		(3)		-		(6)		(6)		(15)		(16)		1		(16)		(15)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		-		(3)		3		(1)		2		(3)		(5)		2		(1)		1
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		-		-		-		-		-		7		(7)		6		(1)
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		-		-		-		-		-		1		(11)		12		-		12
Gain (loss) on disposition of operations, after-tax		2		(44)		46		-		46		(53)		(514)		461		-		461
Net income available to common shareholders	$	208	$	119	$	89	$	34	$	123	$	631	$	95	$	536	$	116	$	652

(1)As a result of LBL disposition on April 1, 2014,  Allstate Financial results no longer include LBL beginning in the second quarter of 2014. To assist with comparison of Allstate Financial results between periods, estimated results of LBL business for the second through fourth quarter of 2013 were excluded in this presentation.

42

THE ALLSTATE CORPORATION

ESTIMATED RESULTS OF DISPOSED LBL BUSINESS

($ in millions)

		Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2014		2013		2013		2013		2013
Premiums and contract charges	$	85	$	89	$	83	$	82	$	87
Net investment income (1) (2)		126		126		135		136		141
Contract benefits		(65)		(46)		(65)		(62)		(44)
Interest credited to contractholder funds		(80)		(83)		(80)		(85)		(97)
Amortization of deferred policy acquisition costs		(6)		(17)		22		(11)		(23)
Operating costs and expenses		(8)		(7)		(11)		(13)		(16)
Income tax expense on operations		(18)		(21)		(29)		(16)		(16)
Operating income		34		41		55		31		32
Realized capital gains and losses, after-tax		-		-		-		-		-
Valuation changes of equity-indexed annuity forward starting options, after-tax		(6)		(6)		(8)		(2)		(6)
DAC and DSI amortization relating to non-operating items, after tax		-		(1)		1		(1)		1
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		-		6		-		-
Net income	$	28	$	34	$	54	$	28	$	27
Benefit spread	$	(1)	$	19	$	(4)	$	(4)	$	15
Investment spread		46		43		55		51		44
Surrender charges and contract maintenance expense fees		21		24		22		24		28

(1)Net investment income included investment expenses of $5 million in each quarter of 2013 and $4 million in first quarter 2014.  These expenses are not expected to be eliminated in connection with the LBL sale.

(2)The loss on disposition relating to the LBL sale is not included in LBL’s results.

43

ALLSTATE FINANCIAL

RETURN ON ATTRIBUTED EQUITY

($ in millions)

		Twelve months ended
		Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2014			2014			2014			2014			2013			2013			2013			2013
Return on Attributed Equity
Numerator:
Net income available to common shareholders (1)	$	631		$	542		$	66		$	111		$	95		$	142		$	633		$	575
Denominator:
Beginning attributed equity (2)	$	7,273		$	7,819		$	8,224		$	8,617		$	8,446		$	8,291		$	7,737		$	7,475
Ending attributed equity		7,672			7,356			7,262			7,812			7,273			7,819			8,224			8,617
Average attributed equity (3)	$	7,473		$	7,588		$	7,743		$	8,215		$	7,860		$	8,055		$	7,981		$	8,046
Return on attributed equity		8.4	%		7.1	%		0.9	%		1.4	%		1.2	%		1.8	%		7.9	%		7.1	%
Operating Income Return on Attributed Equity
Numerator:
Operating income (1)	$	607		$	639		$	641		$	633		$	588		$	572		$	542		$	523
Denominator:
Beginning attributed equity (2)	$	7,273		$	7,819		$	8,224		$	8,617		$	8,446		$	8,291		$	7,737		$	7,475
Unrealized net capital gains and losses		946			1,076			1,120			1,702			1,678			1,666			1,240			1,073
Adjusted beginning attributed equity		6,327			6,743			7,104			6,915			6,768			6,625			6,497			6,402
Ending attributed equity		7,672			7,356			7,262			7,812			7,273			7,819			8,224			8,617
Unrealized net capital gains and losses		1,420			1,305			1,285			1,280			946			1,076			1,120			1,702
Adjusted ending attributed equity		6,252			6,051			5,977			6,532			6,327			6,743			7,104			6,915
Average adjusted attributed equity (3)	$	6,290		$	6,397		$	6,541		$	6,724		$	6,548		$	6,684		$	6,801		$	6,659
Operating income return on attributed equity		9.7	%		10.0	%		9.8	%		9.4	%		9.0	%		8.6	%		8.0	%		7.9	%

(1)Net income available to common shareholders and operating income reflect a trailing twelve-month period.

(2)Allstate Financial attributed equity is the sum of equity for Allstate Life Insurance Company and the applicable equity for Allstate Financial Insurance Holdings Corporation.

(3)Average attributed equity and average adjusted attributed equity are determined using a two-point average, with the beginning and ending attributed equity and adjusted attributed equity, respectively, for the twelve-month period as data points.

44

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL PREMIUMS AND CONTRACT CHARGES

($ in millions)

		Three months ended																Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
PREMIUMS AND CONTRACT CHARGES - BY PRODUCT
Underwritten Products
Traditional life insurance premiums	$	133	$	126	$	125	$	127	$	136	$	120	$	119	$	116	$	511	$	491
Accident and health insurance premiums		180		182		187		195		181		180		179		180		744		720
Interest-sensitive life insurance contract charges		203		200		202		274		273		272		268		273		879		1,086
		516		508		514		596		590		572		566		569		2,134		2,297
Annuities
Immediate annuities with life contingencies premiums		(1)		-		-		5		15		6		9		7		4		37
Other fixed annuity contract charges		5		4		4		6		5		6		4		3		19		18
		4		4		4		11		20		12		13		10		23		55
Total	$	520	$	512	$	518	$	607	$	610	$	584	$	579	$	579	$	2,157	$	2,352
PREMIUMS AND CONTRACT CHARGES - BY DISTRIBUTION CHANNEL
Allstate agencies (1)	$	294	$	288	$	285	$	291	$	294	$	283	$	281	$	276	$	1,158	$	1,134
Workplace enrolling agents		198		198		203		204		195		195		189		188		803		767
Other (2)		28		26		30		112		121		106		109		115		196		451
Total	$	520	$	512	$	518	$	607	$	610	$	584	$	579	$	579	$	2,157	$	2,352
PREMIUMS AND CONTRACT CHARGES - BY PRODUCT INCLUDED IN LINCOLN BENEFIT LIFE COMPANY SALE (3)
Underwritten Products
Traditional life insurance premiums	$	-	$	-	$	-	$	6	$	7	$	4	$	6	$	5	$	6	$	22
Accident and health insurance premiums		-		-		-		6		7		6		5		6		6		24
Interest-sensitive life insurance contract charges		-		-		-		71		73		71		70		74		71		288
		-		-		-		83		87		81		81		85		83		334
Annuities
Immediate annuities with life contingencies premiums		-		-		-		-		-		-		-		-		-		-
Other fixed annuity contract charges		-		-		-		2		2		2		1		2		2		7
		-		-		-		2		2		2		1		2		2		7
Total	$	-	$	-	$	-	$	85	$	89	$	83	$	82	$	87	$	85	$	341
ISSUED LIFE INSURANCE POLICIES BY DISTRIBUTION CHANNEL(4)
Allstate agencies (1)		39,355		33,483		32,625		31,220		42,286		35,537		34,074		36,421		136,683		148,318
Other		-		-		-		-		146		447		618		879		-		2,090
Total		39,355		33,483		32,625		31,220		42,432		35,984		34,692		37,300		136,683		150,408
ALLSTATE BENEFITS NEW BUSINESS WRITTEN PREMIUMS (5)	$	183	$	63	$	58	$	52	$	164	$	59	$	64	$	52	$	356	$	339

(1)Includes products directly sold through call centers and internet.

(2)Primarily represents independent master brokerage agencies, and to a lesser extent, specialized brokers.

(3)Amounts are included in section above. On April 1, 2014, the sale of LBL was completed.

(4)Excludes Allstate Benefits and non-proprietary products.

(5)New business written premiums reflect annualized premiums at initial customer enrollment (including new accounts and new employees or policies of existing accounts), reduced by an estimate for certain policies that are expected to lapse. A significant portion of Allstate Benefits business is seasonally written in the fourth quarter during many clients’ annual employee benefits enrollment.

45

THE ALLSTATE CORPORATION

CHANGE IN CONTRACTHOLDER FUNDS

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Contractholders funds, beginning balance	$	22,848	$	23,472	$	23,989	$	24,304	$	24,476	$	36,357	$	38,807	$	39,319	$	24,304	$	39,319
Contractholders funds classified as held for sale, beginning balance		-		-		10,661		10,945		11,283		-		-		-		10,945		-
Total contractholders funds, including those classified as held for sale		22,848		23,472		34,650		35,249		35,759		36,357		38,807		39,319		35,249		39,319
Deposits
Interest-sensitive life insurance		248		247		246		318		334		330		328		386		1,059		1,062
Fixed annuities		43		48		56		127		276		218		281		287		274		1,378
Total deposits		291		295		302		445		610		548		609		673		1,333		2,440
Interest credited		202		197		212		308		310		321		314		350		919		1,295
Benefits, withdrawals, maturities and other adjustments
Benefits		(242)		(286)		(289)		(380)		(349)		(392)		(399)		(395)		(1,197)		(1,535)
Surrenders and partial withdrawals		(377)		(630)		(554)		(712)		(756)		(807)		(845)		(891)		(2,273)		(3,299)
Maturities of and interest payments on institutional products		(1)		(1)		-		-		-		(1)		(1,797)		(1)		(2)		(1,799)
Contract charges		(204)		(197)		(199)		(281)		(282)		(279)		(274)		(277)		(881)		(1,112)
Net transfers from separate accounts		1		2		1		3		4		2		5		1		7		12
Other adjustments		11		(4)		11		18		(47)		10		(63)		28		36		(72)
Total benefits, withdrawals, maturities and other adjustments		(812)		(1,116)		(1,030)		(1,352)		(1,430)		(1,467)		(3,373)		(1,535)		(4,310)		(7,805)
Contractholder funds sold in LBL disposition		-		-		(10,662)		-		-		-		-		-		(10,662)		(10,945)
Contractholder funds classified as held for sale, ending balance		-		-		-		(10,661)		(10,945)		(11,283)		-		-		-		-
Contractholder funds, ending balance	$	22,529	$	22,848	$	23,472	$	23,989	$	24,304	$	24,476	$	36,357	$	38,807	$	22,529	$	24,304

46

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL ANALYSIS OF NET INCOME

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Benefit spread
Premiums	$	312	$	308	$	312	$	327	$	332	$	306	$	307	$	303	$	1,259	$	1,248
Cost of insurance contract charges (1)		136		135		135		187		184		182		179		180		593		725
Contract benefits excluding the implied interest on immediate annuities with life contingencies (2)		(301)		(302)		(283)		(358)		(359)		(365)		(341)		(325)		(1,244)		(1,390)
Total benefit spread		147		141		164		156		157		123		145		158		608		583
Investment spread
Net investment income		480		473		538		640		637		633		633		635		2,131		2,538
Implied interest on immediate annuities with life contingencies (2)		(130)		(131)		(130)		(130)		(131)		(133)		(130)		(133)		(521)		(527)
Interest credited to contractholder funds		(202)		(198)		(212)		(307)		(305)		(317)		(311)		(345)		(919)		(1,278)
Total investment spread		148		144		196		203		201		183		192		157		691		733
Surrender charges and contract maintenance expense fees (1)		72		69		71		93		94		96		93		96		305		379
Realized capital gains and losses		125		28		(10)		1		14		(16)		57		19		144		74
Amortization of deferred policy acquisition costs		(62)		(58)		(66)		(74)		(85)		(97)		(71)		(75)		(260)		(328)
Operating costs and expenses		(121)		(115)		(112)		(118)		(145)		(132)		(140)		(148)		(466)		(565)
Restructuring and related charges		-		1		(1)		(2)		-		(4)		(1)		(2)		(2)		(7)
Gain (loss) on disposition of operations		3		(26)		(8)		(59)		(44)		(646)		1		2		(90)		(687)
Income tax (expense) benefit		(104)		(68)		(89)		(38)		(73)		133		(86)		(61)		(299)		(87)
Net income (loss) available to common shareholders	$	208	$	116	$	145	$	162	$	119	$	(360)	$	190	$	146	$	631	$	95
Benefit spread by product group
Life insurance	$	72	$	72	$	86	$	74	$	101	$	60	$	75	$	86	$	304	$	322
Accident and health insurance		91		99		97		102		78		85		86		89		389		338
Annuities		(16)		(30)		(19)		(20)		(22)		(22)		(16)		(17)		(85)		(77)
Total benefit spread	$	147	$	141	$	164	$	156	$	157	$	123	$	145	$	158	$	608	$	583
Investment spread by product group
Annuities and institutional products	$	58	$	54	$	98	$	110	$	95	$	100	$	88	$	59	$	320	$	342
Life insurance		24		23		26		30		28		25		25		27		103		105
Accident and health insurance		4		4		4		7		6		6		7		6		19		25
Net investment income on investments supporting capital		65		61		72		73		75		69		67		74		271		285
Investment spread before valuation changes on embedded derivatives that are not hedged		151		142		200		220		204		200		187		166		713		757
Valuation changes on derivatives embedded in equity- indexed annuity contracts that are not hedged		(3)		2		(4)		(17)		(3)		(17)		5		(9)		(22)		(24)
Total investment spread	$	148	$	144	$	196	$	203	$	201	$	183	$	192	$	157	$	691	$	733
(1) Reconciliation of contract charges
Cost of insurance contract charges	$	136	$	135	$	135	$	187	$	184	$	182	$	179	$	180	$	593	$	725
Surrender charges and contract maintenance expense fees		72		69		71		93		94		96		93		96		305		379
Total contract charges	$	208	$	204	$	206	$	280	$	278	$	278	$	272	$	276	$	898	$	1,104
(2) Reconciliation of contract benefits
Contract benefits excluding the implied interest on immediate annuities with life contingencies	$	(301)	$	(302)	$	(283)	$	(358)	$	(359)	$	(365)	$	(341)	$	(325)	$	(1,244)	$	(1,390)
Implied interest on immediate annuities with life contingencies		(130)		(131)		(130)		(130)		(131)		(133)		(130)		(133)		(521)		(527)
Total contract benefits	$	(431)	$	(433)	$	(413)	$	(488)	$	(490)	$	(498)	$	(471)	$	(458)	$	(1,765)	$	(1,917)

47

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL WEIGHTED AVERAGE INVESTMENT SPREADS

	Three months ended December 31, 2014						Three months ended December 31, 2013 (1)
	Weighted average		Weighted average		Weighted average		Weighted average		Weighted average		Weighted average
	investment yield		interest crediting rate		investment spreads		investment yield		interest crediting rate		investment spreads
Interest-sensitive life insurance	5.1	%	4.0	%	1.1	%	5.2	%	3.9	%	1.3	%
Deferred fixed annuities and institutional products	4.5		2.9		1.6		4.2		2.9		1.3
Immediate fixed annuities with and without life contingencies	7.0		6.0		1.0		7.8		6.0		1.8
Investments supporting capital, traditional life and other products	4.3		n/a		n/a		4.1		n/a		n/a
	Twelve months ended December 31, 2014 (1)						Twelve months ended December 31, 2013 (1)
	Weighted average		Weighted average		Weighted average		Weighted average		Weighted average		Weighted average
	investment yield		interest crediting rate		investment spreads		investment yield		interest crediting rate		investment spreads
Interest-sensitive life insurance	5.3	%	3.9	%	1.4	%	5.1	%	3.8	%	1.3	%
Deferred fixed annuities and institutional products	4.5		2.9		1.6		4.5		2.9		1.6
Immediate fixed annuities with and without life contingencies	7.3		6.0		1.3		6.9		6.0		0.9
Investments supporting capital, traditional life and other products	4.4		n/a		n/a		4.0		n/a		n/a

(1) For purposes of these calculations, investments, reserves and contractholder funds classified as held for sale were included for periods prior to April 1, 2014.

48

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL SUPPLEMENTAL PRODUCT INFORMATION

($ in millions)

		As of December 31, 2014				Twelve months ended December 31, 2014	Operating income return on attributed equity (%)
				Attributed equity			Twelve months ended
		Reserves and		excluding unrealized			Dec.		Sept.		June		March		Dec.		Sept.		June		March
		Contractholder funds		capital gains/losses (3)(4)		Operating income (5)	2014		2014		2014		2014		2013		2013		2013		2013
Underwritten products
Life insurance	$	10,500	$	2,284	$	268	11.0	%	11.7	%	8.9	%	9.0	%	9.4	%	8.4	%	8.6	%	8.9	%
Accident and health insurance		831		693		105	16.0		15.0		14.5		14.7		14.8		15.6		15.4		13.5
Subtotal		11,331		2,977		373	12.1		12.4		9.9		10.1		10.4		9.7		9.8		9.8
Annuities and institutional products:
Immediate Annuities:
Sub-standard structured settlements and group pension terminations(1)		5,059		1,399		13	1.1		1.4		2.0		0.7		(0.5)		(1.4)		(1.8)		(1.9)
Standard structured settlements and SPIA (2)		7,323		835		73	10.5		12.2		16.8		13.2		9.5		7.8		5.5		5.1
Subtotal		12,382		2,234		86	4.5		5.3		7.1		5.0		3.0		1.7		0.7		0.4
Deferred Annuities		11,111		1,036		146	11.1		10.7		12.0		12.3		12.0		12.5		11.3		10.9
Institutional products		85		5		2
Subtotal		23,578		3,275		234	7.3		7.7		9.6		8.7		7.6		7.4		6.2		6.0
Total Allstate Financial	$	34,909	$	6,252	$	607	9.7		10.0		9.8		9.4		9.0		8.6		8.0		7.9

		Twelve months ended December 31, 2014
		Life		Accident and		Annuities and		Allstate
		insurance		health insurance		institutional products		Financial
Operating income	$	268	$	105	$	234	$	607
Realized capital gains and losses, after-tax		5		-		89		94
Valuation changes on embedded derivatives that are not hedged, after-tax		-		-		(15)		(15)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(4)		-		1		(3)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		-		-		-
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		1		-		-		1
Loss on disposition of operations, after-tax		(28)		-		(25)		(53)
Net income available to common shareholders	$	242	$	105	$	284	$	631

(1)	Structured settlement annuities for annuitants with severe injuries or other health impairments which significantly reduced their life expectancy at the time the annuity was issued and group annuity contracts issued to sponsors of terminated pension plans.
(2)	Life-contingent structured settlement annuities for annuitants with standard life expectancy, period certain structured settlements and single premium immediate annuities with and without life contingencies.
(3)	Total Allstate Financial attributed equity is the sum of equity for Allstate Life Insurance Company and the applicable equity for Allstate Financial Insurance Holdings Corporation, excluding unrealized capital gains and losses.
(4)	Attributed equity is allocated to each product line based on statutory capital adjusted for GAAP reporting differences and the amount of capital held in Allstate Financial may vary from economic capital. The calculation of statutory capital by product incorporates internal factors for invested asset risk, insurance risk (mortality and morbidity), interest rate risk and business risk. Due to the unavailability of final statutory financial statements at the time we release our GAAP financial results, the allocation is derived from prior quarter statutory capital. Statutory capital is adjusted for appropriate GAAP accounting differences. Changes in internal capital factors, investment portfolio mix and risk as well as changes in GAAP and statutory reporting differences will result in changes to the allocation of attributed equity to products.
(5)	Product line operating income includes allocation of income on investments supporting capital. Operating income reflects a trailing twelve-month period.

49

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL INSURANCE POLICIES AND ANNUITIES IN FORCE (1)

(in thousands)

	Dec. 31,	Sept. 30,	June 30,	March 31,	Dec. 31,	Sept. 30,	June 30,	March 31,
	2014	2014	2014	2014	2013	2013	2013	2013
ALLSTATE FINANCIAL INSURANCE POLICIES AND ANNUITIES IN FORCE BY PRODUCT
Underwritten products
Life insurance	2,434	2,432	2,436	2,588	2,567	2,572	2,574	2,572
Accident and health insurance	2,555	2,530	2,577	2,593	2,342	2,322	2,322	2,338
	4,989	4,962	5,013	5,181	4,909	4,894	4,896	4,910
Annuities
Deferred annuities	191	197	205	337	346	353	362	373
Immediate annuities	108	108	110	111	112	112	113	114
	299	305	315	448	458	465	475	487
Total	5,288	5,267	5,328	5,629	5,367	5,359	5,371	5,397
ALLSTATE FINANCIAL INSURANCE POLICIES AND ANNUITIES IN FORCE BY SOURCE OF BUSINESS
Allstate Agencies (2)	1,902	1,898	1,895	1,938	1,939	1,938	1,936	1,930
Allstate Benefits	2,983	2,957	3,010	3,040	2,762	2,741	2,741	2,757
Other (3)	403	412	423	651	666	680	694	710
Total	5,288	5,267	5,328	5,629	5,367	5,359	5,371	5,397
INSURANCE POLICIES AND ANNUITIES IN FORCE INCLUDED IN LINCOLN BENEFIT LIFE COMPANY SALE
Life insurance	-	-	-	142	145	148	150	152
Deferred annuities	-	-	-	124	128	132	138	144
Total	-	-	-	266	273	280	288	296

(1)Allstate Financial insurance policies and annuities in force reflect the number of contracts in force excluding sold blocks of business that remain on the balance sheet due to the dispositions of the business being effected through reinsurance arrangements. Policy counts associated with our voluntary employee benefits group business reflect certificate counts as opposed to group counts.

(2)Excludes Allstate Benefits products sold through Allstate Agencies, which are included in the Allstate Benefits line.

(3)Primarily business sold by independent master brokerage agencies, banks/broker-dealers and specialized structured settlement brokers.

50

THE ALLSTATE CORPORATION

ALLSTATE LIFE AND ANNUITIES AND ALLSTATE BENEFITS RESULTS AND PRODUCT INFORMATION

($ in millions)

		For the twelve months ended December 31, 2014						For the twelve months ended December 31, 2013
						Allstate						Allstate
		Allstate Life and		Allstate		Financial		Allstate Life and		Allstate		Financial
		Annuities		Benefits		Segment		Annuities		Benefits		Segment
Premiums	$	488	$	771	$	1,259	$	518	$	730	$	1,248
Contract charges		800		98		898		1,009		95		1,104
Net investment income		2,059		72		2,131		2,466		72		2,538
Periodic settlements and accruals on non-hedge derivative instruments		(1)		-		(1)		17		-		17
Contract benefits		(1,354)		(411)		(1,765)		(1,512)		(405)		(1,917)
Interest credited to contractholder funds		(862)		(36)		(898)		(1,219)		(35)		(1,254)
Amortization of deferred policy acquisition costs		(143)		(112)		(255)		(228)		(102)		(330)
Operating costs and expenses		(260)		(206)		(466)		(366)		(199)		(565)
Restructuring and related charges		(2)		-		(2)		(6)		(1)		(7)
Income tax expense on operations		(232)		(62)		(294)		(192)		(54)		(246)
Operating income		493		114		607		487		101		588
Realized capital gains and losses, after-tax		93		1		94		47		(1)		46
Valuation changes on embedded derivatives that are not hedged, after-tax		(15)		-		(15)		(16)		-		(16)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(3)		-		(3)		(5)		-		(5)
DAC and DSI unlocking relating to realized capital gains and losses, after tax		-		-		-		7		-		7
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		1		-		1		(11)		-		(11)
Loss on disposition of operations, after-tax		(53)		-		(53)		(514)		-		(514)
Net income (loss)	$	516	$	115	$	631	$	(5)	$	100	$	95
Premiums and Contract Charges - by Product
Underwritten Products
Traditional life insurance premiums	$	476	$	35	$	511	$	455	$	36	$	491
Accident and health insurance premiums		8		736		744		26		694		720
Interest-sensitive life insurance contract charges		781		98		879		991		95		1,086
		1,265		869		2,134		1,472		825		2,297
Annuities
Immediate annuities with life contingencies premiums		4		-		4		37		-		37
Other fixed annuity contract charges		19		-		19		18		-		18
		23		-		23		55		-		55
Total life and annuity premiums and contract charges	$	1,288	$	869	$	2,157	$	1,527	$	825	$	2,352
Benefit Spread by Product Group
Life Insurance	$	287	$	17	$	304	$	301	$	21	$	322
Accident and health insurance		(8)		397		389		(18)		356		338
Annuities		(85)		-		(85)		(77)		-		(77)
Total benefit spread	$	194	$	414	$	608	$	206	$	377	$	583
Investment Spread by Product Group
Annuities and institutional products	$	320	$	-	$	320	$	342	$	-	$	342
Life insurance		93		10		103		93		12		105
Accident and health insurance		8		11		19		14		11		25
Net investment income on investments supporting capital		256		15		271		271		14		285
Investment spread before valuation changes on embedded derivatives that are not hedged		677		36		713		720		37		757
Valuation changes on derivatives embedded in equity- indexed annuity contracts that are not hedged		(22)		-		(22)		(24)		-		(24)
Total investment spread	$	655	$	36	$	691	$	696	$	37	$	733

51

THE ALLSTATE CORPORATION

CORPORATE AND OTHER RESULTS

($ in millions)

	Three months ended																	Twelve months ended
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,
		2014		2014		2014		2014		2013		2013		2013		2013		2014		2013
Net investment income	$	5	$	6	$	9	$	7	$	7	$	8	$	8	$	7	$	27	$	30
Operating costs and expenses		(14)		(6)		(10)		(8)		(171)		(76)		(8)		3		(38)		(252)
Interest expense		(73)		(77)		(84)		(87)		(87)		(83)		(98)		(98)		(321)		(366)
Income tax benefit on operations		32		28		32		32		90		58		37		35		124		220
Preferred stock dividends		(29)		(31)		(31)		(13)		(11)		(6)		-		-		(104)		(17)
Operating loss		(79)		(80)		(84)		(69)		(172)		(99)		(61)		(53)		(312)		(385)
Realized capital gains and losses, after-tax		-		-		(1)		1		(1)		1		-		-		-		-
Loss on extinguishment of debt, after-tax		-		-		-		-		(1)		(6)		(312)		-		-		(319)
Postretirement benefits curtailment gain, after-tax		-		-		-		-		-		118		-		-		-		118
Net (loss) income available to common shareholders	$	(79)	$	(80)	$	(85)	$	(68)	$	(174)	$	14	$	(373)	$	(53)	$	(312)	$	(586)

52

THE ALLSTATE CORPORATION

INVESTMENTS

($ in millions)

	PROPERTY-LIABILITY										ALLSTATE FINANCIAL (1)
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,
		2014		2014		2014		2014		2013		2014		2014		2014		2014		2013
Fixed income securities, at fair value:
Tax-exempt	$	4,138	$	4,288	$	4,353	$	4,618	$	4,711	$	75	$	39	$	2	$	2	$	2
Taxable		26,696		27,078		26,091		24,223		24,867		29,007		28,984		29,898		30,057		29,646
Equity securities, at fair value		3,076		3,053		4,072		4,341		4,396		1,028		1,282		1,322		956		701
Mortgage loans		370		372		373		403		429		3,818		3,771		3,801		4,069		4,292
Limited partnership interests		2,498		2,411		2,438		2,900		2,898		2,024		1,933		1,866		2,121		2,064
Short-term, at fair value		822		1,328		812		894		1,002		1,026		880		1,038		870		668
Other		1,483		1,401		1,531		1,528		1,335		1,831		1,718		1,607		1,635		1,732
Total	$	39,083	$	39,931	$	39,670	$	38,907	$	39,638	$	38,809	$	38,607	$	39,534	$	39,710	$	39,105
Fixed income securities, amortized cost:
Tax-exempt	$	4,054	$	4,181	$	4,238	$	4,521	$	4,625	$	74	$	39	$	2	$	2	$	2
Taxable		26,376		26,715		25,484		23,696		24,424		26,668		26,785		27,464		28,130		28,295
Ratio of fair value to amortized cost		101.3%		101.5%		102.4%		102.2%		101.8%		108.8%		108.2%		108.9%		106.8%		104.8%
Equity securities, cost	$	2,723	$	2,745	$	3,492	$	3,737	$	3,866	$	969	$	1,132	$	1,166	$	838	$	607
Short-term, amortized cost		822		1,328		812		894		1,002		1,026		880		1,038		870		668
	CORPORATE AND OTHER										CONSOLIDATED
		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		Dec. 31,
		2014		2014		2014		2014		2013		2014		2014		2014		2014		2013
Fixed income securities, at fair value:
Tax-exempt	$	564	$	561	$	565	$	558	$	570	$	4,777	$	4,888	$	4,920	$	5,178	$	5,283
Taxable		1,960		1,363		1,725		1,703		1,114		57,663		57,425		57,714		55,983		55,627
Equity securities, at fair value		-		-		-		-		-		4,104		4,335		5,394		5,297		5,097
Mortgage loans		-		-		-		-		-		4,188		4,143		4,174		4,472		4,721
Limited partnership interests		5		4		5		3		5		4,527		4,348		4,309		5,024		4,967
Short-term, at fair value		692		255		1,064		809		723		2,540		2,463		2,914		2,573		2,393
Other		-		-		-		-		-		3,314		3,119		3,138		3,163		3,067
Total	$	3,221	$	2,183	$	3,359	$	3,073	$	2,412	$	81,113	$	80,721	$	82,563	$	81,690	$	81,155
Fixed income securities, amortized cost:
Tax-exempt	$	543	$	536	$	541	$	538	$	552	$	4,671	$	4,756	$	4,781	$	5,061	$	5,179
Taxable		1,957		1,360		1,718		1,700		1,110		55,001		54,860		54,666		53,526		53,829
Ratio of fair value to amortized cost		101.0%		101.5%		101.4%		101.0%		101.3%		104.6%		104.5%		105.4%		104.4%		103.2%
Equity securities, cost	$	-	$	-	$	-	$	-	$	-	$	3,692	$	3,877	$	4,658	$	4,575	$	4,473
Short-term, amortized cost		692		255		1,064		809		723		2,540		2,463		2,914		2,573		2,393

(1)      Excludes investments classified as held for sale that totaled $11.5 billion, $12.0 billion and $12.2 billion as of March 31, 2014, December 31, 2013 and September 30, 2013, respectively.

53

THE ALLSTATE CORPORATION

INVESTMENT PORTFOLIO DETAILS

($ in millions)

		Financial statement classification as of December 31, 2014
								Limited
		Fixed income		Equity		Mortgage		partnership		Short-
		securities		securities		loans		interests		term		Other (1)		Total
Infrastructure and real assets
Infrastructure and real assets - debt	$	10,437	$	-	$	-	$	-	$	-	$	-	$	10,437
Infrastructure and real assets - equity		-		390		-		562		-		-		952
Infrastructure and real assets - other		-		-		-		-		-		168		168
		10,437		390		-		562		-		168		11,557
Real estate
Real estate - debt		1,822		-		4,188		-		-		-		6,010
Real estate - equity		-		74		-		1,413		-		113		1,600
		1,822		74		4,188		1,413		-		113		7,610
Consumer goods (cyclical and non-cyclical)		10,771		933		-		-		-		-		11,704
Banking & financial services
Banking		3,629		392		-		-		-		-		4,021
Financial services		3,176		520		-		-		-		-		3,696
Credit card and student loan ABS		836		-		-		-		-		-		836
Consumer auto ABS		1,282		-		-		-		-		-		1,282
		8,923		912		-		-		-		-		9,835
Municipal - General obligation, revenue and taxable		8,497		-		-		-		-		-		8,497
Government & agencies
U.S. government and agencies		4,328		-		-		-		692		-		5,020
Foreign government		1,384		-		-		-		-		-		1,384
		5,712		-		-		-		692		-		6,404
Technology and communications
Communications		3,043		231		-		-		-		-		3,274
Technology		2,312		418		-		-		-		-		2,730
		5,355		649		-		-		-		-		6,004
Capital goods		4,132		314		-		-		-		-		4,446
Basic & other industries
Basic industry		2,313		159		-		-		-		-		2,472
Other industries		620		-		-		-		-		-		620
		2,933		159		-		-		-		-		3,092
Transportation		1,737		87		-		-		-		-		1,824
ABS other		1,860		-		-		-		-		-		1,860
Private equity		-		-		-		2,194		-		-		2,194
Emerging markets
Fixed income funds		-		152		-		-		-		-		152
Foreign government		261		-		-		-		-		-		261
Equity index based funds		-		16		-		-		-		-		16
		261		168		-		-		-		-		429
Other equity market index based funds		-		418		-		-		-		-		418
Other funds		-		-		-		358		-		-		358
Other		-		-		-		-		1,848		3,033		4,881
Total investments	$	62,440	$	4,104	$	4,188	$	4,527	$	2,540	$	3,314	$	81,113

(1)   Other includes derivatives, policy loans, agent loans, bank loans and short-term investments.

54

THE ALLSTATE CORPORATION

LIMITED PARTNERSHIP INVESTMENTS

($ in millions)

	As of or for the three months ended
		Dec. 31,			Sept. 30,			June 30,		March 31,			Dec. 31,		Sept. 30,			June 30,			March 31,
		2014			2014			2014		2014			2013		2013			2013			2013
Investment position
Accounting basis
Cost method	$	1,122		$	1,144		$	1,157	$	1,346		$	1,443	$	1,435		$	1,441		$	1,425
Equity method (“EMA”)(1)		3,405			3,204			3,152		3,678			3,524		3,656			3,500			3,506
Total	$	4,527		$	4,348		$	4,309	$	5,024		$	4,967	$	5,091		$	4,941		$	4,931
Cost method-fair value(2)	$	1,488		$	1,555		$	1,577	$	1,764		$	1,835	$	1,806		$	1,795		$	1,748
Underlying investment
Private equity / debt funds	$	2,756		$	2,759		$	2,631	$	2,674		$	2,562	$	2,485		$	2,457		$	2,423
Real estate funds		1,413			1,425			1,517		1,577			1,687		1,666			1,658			1,635
Other (3)		358			164			161		773			718		940			826			873
Total	$	4,527		$	4,348		$	4,309	$	5,024		$	4,967	$	5,091		$	4,941		$	4,931
Segment
Property-Liability	$	2,498		$	2,411		$	2,438	$	2,900		$	2,898	$	3,043		$	2,991		$	2,994
Allstate Financial		2,024			1,933			1,866		2,121			2,064		2,044			1,946			1,933
Corporate and Other		5			4			5		3			5		4			4			4
Total	$	4,527		$	4,348		$	4,309	$	5,024		$	4,967	$	5,091		$	4,941		$	4,931
Total Income
Accounting basis
Cost method	$	60		$	25		$	66	$	50		$	80	$	48		$	45		$	26
Equity method		55			137			129		92			122		58			81			81
Total	$	115		$	162		$	195	$	142		$	202	$	106		$	126		$	107
Underlying investment
Private equity / debt funds	$	96		$	66		$	123	$	106		$	140	$	68		$	58		$	68
Real estate funds		25			93			55		38			61		49			77			34
Other		(6	)		3			17		(2	)		1		(11	)		(9	)		5
Total	$	115		$	162		$	195	$	142		$	202	$	106		$	126		$	107
Segment
Property-Liability	$	57		$	112		$	102	$	75		$	130	$	69		$	89		$	77
Allstate Financial		58			51			91		67			71		37			37			30
Corporate and Other		-			(1	)		2		-			1		-			-			-
Total	$	115		$	162		$	195	$	142		$	202	$	106		$	126		$	107

(1)As of December 31, 2014, valuations of EMA limited partnerships include approximately $571 million of cumulative pre-tax appreciation that has been recognized in earnings but has not been distributed to investors.

(2)The fair value of cost method limited partnerships is determined using reported net asset values of the underlying funds.

(3)In periods prior to June 30, 2014, other included tax credit funds.

55

THE ALLSTATE CORPORATION

UNREALIZED NET CAPITAL GAINS AND LOSSES ON SECURITY PORTFOLIO BY TYPE

($ in millions)

		December 31, 2014					September 30, 2014					June 30, 2014
		Unrealized net			Fair value		Unrealized net			Fair value		Unrealized net			Fair value
		capital gains		Fair	as a percent of		capital gains		Fair	as a percent of		capital gains		Fair	as a percent of
		and losses		value	amortized cost (1)		and losses		value	amortized cost (1)		and losses		value	amortized cost (1)
Fixed income securities
U.S. government and agencies	$	136	$	4,328	103.2	$	128	$	4,309	103.1	$	146	$	4,853	103.1
Municipal		620		8,497	107.9		557		8,535	107.0		552		8,561	106.9
Corporate		1,758		42,144	104.4		1,742		41,071	104.4		2,185		41,467	105.6
Foreign government		102		1,645	106.6		96		1,693	106.0		107		1,676	106.8
Asset-backed securities (“ABS”)		7		3,978	100.2		18		4,709	100.4		40		3,943	101.0
Residential mortgage-backed securities (“RMBS”)		99		1,207	108.9		104		1,289	108.8		99		1,362	107.8
Commercial mortgage-backed securities (“CMBS”)		42		615	107.3		48		681	107.6		54		746	107.8
Redeemable preferred stock		4		26	118.2		4		26	118.2		4		26	118.2
Total fixed income securities		2,768		62,440	104.6		2,697		62,313	104.5		3,187		62,634	105.4
Equity securities		412		4,104	111.2		458		4,335	111.8		736		5,394	115.8
Short-term investments		-		2,540	100.0		-		2,463	100.0		-		2,914	100.0
Derivatives		(2)		92	n/a		(8)		73	n/a		(19)		103	n/a
EMA limited partnership interests (2)		(5)		n/a	n/a		(5)		n/a	n/a		(5)		n/a	n/a
Investments classified as held for sale		-		n/a	n/a		-		n/a	n/a		-		n/a	n/a
Unrealized net capital gains and losses, pre-tax		3,173					3,142					3,899
Amounts recognized for:
Insurance reserves (3)		(28)					(169)					(399)
DAC and DSI (4)		(179)					(158)					(189)
Amounts recognized		(207)					(327)					(588)
Deferred income taxes		(1,040)					(988)					(1,161)
Unrealized net capital gains and losses, after-tax	$	1,926				$	1,827				$	2,150

		March 31, 2014					December 31, 2013					September 30, 2013
		Unrealized net			Fair value		Unrealized net			Fair value		Unrealized net			Fair value
		capital gains		Fair	as a percent of		capital gains		Fair	as a percent of		capital gains		Fair	as a percent of
		and losses		value	amortized cost (1)		and losses		value	amortized cost (1)		and losses		value	amortized cost (1)
Fixed income securities
U.S. government and agencies	$	132	$	3,806	103.6	$	122	$	2,913	104.4	$	156	$	2,881	105.7
Municipal		421		8,716	105.1		277		8,723	103.3		365		9,611	103.9
Corporate		1,743		41,159	104.4		1,272		40,603	103.2		1,412		39,697	103.7
Foreign government		96		1,737	105.9		88		1,824	105.1		108		1,939	105.9
ABS		38		3,497	101.1		27		4,518	100.6		32		3,421	100.9
RMBS		93		1,438	106.9		71		1,474	105.1		57		1,844	103.2
CMBS		47		783	106.4		41		829	105.2		31		875	103.7
Redeemable preferred stock		4		25	119.0		4		26	118.2		5		27	122.7
Total fixed income securities		2,574		61,161	104.4		1,902		60,910	103.2		2,166		60,295	103.7
Equity securities		722		5,297	115.8		624		5,097	114.0		442		4,812	110.1
Short-term investments		-		2,573	100.0		-		2,393	100.0		-		2,694	100.0
Derivatives		(19)		169	n/a		(18)		269	n/a		(19)		217	n/a
EMA limited partnership interests (2)		(4)		n/a	n/a		(3)		n/a	n/a		(3)		n/a	n/a
Investments classified as held for sale		327		n/a	n/a		190		n/a	n/a		244		n/a	n/a
Unrealized net capital gains and losses, pre-tax		3,600					2,695					2,830
Amounts recognized for:
Insurance reserves (3)		(134)					-					-
DAC and DSI (4)		(245)					(158)					(189)
Amounts recognized		(379)					(158)					(189)
Deferred income taxes		(1,130)					(891)					(927)
Unrealized net capital gains and losses, after-tax	$	2,091				$	1,646				$	1,714

(1)The comparison of percentages from period to period may be distorted by investment transactions such as sales, purchases and impairment write-downs.

(2)Unrealized net capital gains and losses for limited partnership interest represent the Company’s share of EMA limited partnerships’ other comprehensive income.  Fair value and amortized cost are not applicable.

(3)The insurance reserves adjustment represents the amount by which the reserve balance would increase if the net unrealized gains in the applicable product portfolios were realized and reinvested at current lower interest rates, resulting in a premium deficiency.  Although we evaluate premium deficiencies on the combined performance of our life insurance and immediate annuities with life contingencies, the adjustment primarily relates to structured settlement annuities with life contingencies, in addition to annuity buy-outs and certain payout annuities with life contingencies.

(4)The DAC and DSI adjustment balance represents the amount by which the amortization of DAC and DSI would increase or decrease if the unrealized gains or losses in the respective product portfolios were realized.

56

THE ALLSTATE CORPORATION

NET INVESTMENT INCOME, YIELDS AND REALIZED CAPITAL GAINS AND LOSSES (PRE-TAX)

($ in millions)

		Three months ended																								Twelve months ended
		Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Dec. 31,
		2014			2014			2014			2014			2013			2013			2013			2013			2014			2013
NET INVESTMENT INCOME
Fixed income securities	$	577		$	581		$	584		$	705		$	698		$	721		$	740		$	762		$	2,447		$	2,921
Equity securities		26			28			35			28			55			30			39			25			117			149
Mortgage loans		59			54			71			81			82			99			93			98			265			372
Limited partnership interests		115			162			195			142			202			106			126			107			614			541
Short-term		2			1			3			1			1			1			1			2			7			5
Other		43			41			44			42			41			44			39			37			170			161
Subtotal		822			867			932			999			1,079			1,001			1,038			1,031			3,620			4,149
Less:  Investment expense		(43)			(44)			(34)			(40)			(53)			(51)			(54)			(48)			(161)			(206)
Net investment income	$	779		$	823		$	898		$	959		$	1,026		$	950		$	984		$	983		$	3,459		$	3,943
PRE-TAX YIELDS(1)
Fixed income securities		3.9	%		3.9	%		4.0	%		4.1	%		4.1	%		4.2	%		4.2	%		4.3	%		3.9	%		4.2	%
Equity securities		2.7			2.6			3.1			2.5			4.9			2.8			3.9			2.8			2.7			3.6
Mortgage loans		5.7			5.2			6.6			5.4			5.3			6.2			5.8			6.0			5.7			5.9
Limited partnership interests		10.4			15.0			16.7			11.4			15.9			8.6			10.2			8.7			13.3			10.9
Total portfolio		4.2			4.4			4.7			4.5			4.8			4.5			4.6			4.5			4.5			4.6
REALIZED CAPITAL GAINS AND LOSSES (PRE-TAX) BY TRANSACTION TYPE
Impairment write-downs	$	(20)		$	10		$	(6)		$	(16)		$	(11)		$	(18)		$	(33)		$	(10)		$	(32)		$	(72)
Change in intent write-downs		(46)			(63)			(39)			(65)			(19)			(70)			(27)			(27)			(213)			(143)
Net other-than-temporary impairment losses recognized in earnings		(66)			(53)			(45)			(81)			(30)			(88)			(60)			(37)			(245)			(215)
Sales		183			355			290			147			180			59			408			172			975			819
Valuation and settlements of derivative instruments		(11)			(8)			(5)			(12)			(8)			(12)			14			(4)			(36)			(10)
Total	$	106		$	294		$	240		$	54		$	142		$	(41)		$	362		$	131		$	694		$	594
TOTAL RETURN ON INVESTMENT PORTFOLIO (2)		1.1	%		0.4	%		2.2	%		2.1	%		1.1	%		1.0	%		(1.5)	%		1.2	%		5.8	%		1.8	%
AVERAGE INVESTMENT BALANCES (in billions) (3)	$	77.7		$	78.1		$	78.5		$	78.5		$	90.1		$	89.7		$	90.7		$	91.8		$	78.2		$	84.5

(1)Pre-tax yields are calculated as annualized investment income before investment expense (including dividend income in the case of equity securities) divided by the average of investment balances at the end of each quarter during the year. Investment balances, for purposes of the pre-tax yield calculation, exclude unrealized capital gains and losses. Amounts related to investments classified as held for sale were excluded from the pre-tax yield calculation in 2014 and were included in the pre-tax yield calculation in 2013.

(2)Total return on investment portfolio is calculated from GAAP results including the total of net investment income, realized capital gains and losses, the change in unrealized net capital gains and losses, and the change in the difference between fair value and carrying value of mortgage loans and cost method limited partnerships, divided by the average fair value balances. Amounts related to investments classified as held for sale were excluded from the total return calculation in 2014 and were included in the total return calculation in 2013.

(3)Average investment balances for the quarter are calculated as the average of the current and prior quarter investment balances. Year-to-date average investment balances are calculated as the average of investment balances at the beginning of the year and the end of each quarter during the year. For purposes of the average investment balances calculation, unrealized capital gains and losses are excluded. Amounts related to investments classified as held for sale were excluded from average investment balances calculation in 2014 and were included in the average investment balances calculation in 2013.

57

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

NET INVESTMENT INCOME, YIELDS AND REALIZED CAPITAL GAINS AND LOSSES (PRE-TAX)

($ in millions)

		Three months ended																								Twelve months ended
		Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Dec. 31,
		2014			2014			2014			2014			2013			2013			2013			2013			2014			2013
NET INVESTMENT INCOME
Fixed income securities:
Tax-exempt	$	26		$	27		$	29		$	31		$	35		$	44		$	53		$	61		$	113		$	193
Taxable		191			189			183			184			178			175			178			188			747			719
Equity securities		22			21			29			23			51			26			36			23			95			136
Mortgage loans		4			4			4			5			4			6			5			5			17			20
Limited partnership interests(1)		57			112			102			75			130			69			89			77			346			365
Short-term		1			-			2			1			1			1			-			1			4			3
Other		17			15			19			14			11			11			8			8			65			38
Subtotal		318			368			368			333			410			332			369			363			1,387			1,474
Less: Investment expense		(24)			(24)			(17)			(21)			(28)			(23)			(26)			(22)			(86)			(99)
Net investment income	$	294		$	344		$	351		$	312		$	382		$	309		$	343		$	341		$	1,301		$	1,375
Net investment income, after-tax	$	201		$	234		$	240		$	215		$	273		$	225		$	259		$	241		$	890		$	998
PRE-TAX YIELDS (2)
Fixed income securities:
Tax-exempt		2.5	%		2.6	%		2.7	%		2.7	%		2.8	%		3.2	%		3.6	%		3.7	%		2.6	%		3.4	%
Equivalent yield for tax-exempt		3.6			3.8			3.9			3.9			4.1			4.7			5.2			5.4			3.8			5.0
Taxable		2.9			2.9			3.0			3.1			3.0			3.2			3.3			3.5			2.9			3.2
Equity securities		3.2			2.7			3.2			2.5			5.3			2.8			4.0			2.8			2.9			3.8
Mortgage loans		4.1			4.1			4.9			4.3			4.1			4.4			4.2			4.3			4.3			4.2
Limited partnership interests		9.3			18.4			15.3			10.3			17.4			9.3			11.8			10.4			13.1			12.2
Total portfolio		3.3			3.8			3.9			3.5			4.3			3.6			4.0			4.0			3.6			4.0
REALIZED CAPITAL GAINS AND LOSSES (PRE-TAX) BY ASSET TYPE
Fixed income securities:
Tax-exempt	$	2		$	2		$	8		$	4		$	35		$	14		$	39		$	47		$	16		$	135
Taxable		9			22			49			36			44			21			17			43			116			125
Equity securities		(15)			218			225			20			58			(56)			252			28			448			282
Limited partnership interests		2			31			(23)			7			(1)			2			(5)			5			17			1
Derivatives and other		(18)			(7)			(9)			(14)			(8)			(7)			2			(11)			(48)			(24)
Total	$	(20)		$	266		$	250		$	53		$	128		$	(26)		$	305		$	112		$	549		$	519
REALIZED CAPITAL GAINS AND LOSSES (PRE-TAX) BY TRANSACTION TYPE
Impairment write-downs	$	(11)		$	8		$	(6)		$	(12)		$	(6)		$	(8)		$	(17)		$	(8)		$	(21)		$	(39)
Change in intent write-downs		(42)			(42)			(25)			(60)			(15)			(63)			(26)			(20)			(169)			(124)
Net other-than-temporary impairment losses recognized in earnings		(53)			(34)			(31)			(72)			(21)			(71)			(43)			(28)			(190)			(163)
Sales		49			312			289			139			157			52			346			151			789			706
Valuation and settlements of derivative instruments		(16)			(12)			(8)			(14)			(8)			(7)			2			(11)			(50)			(24)
Total	$	(20)		$	266		$	250		$	53		$	128		$	(26)		$	305		$	112		$	549		$	519
AVERAGE INVESTMENT BALANCES (in billions) (3)	$	38.7		$	38.8		$	38.0		$	38.1		$	37.9		$	37.0		$	36.7		$	36.5		$	38.4		$	37.3

(1)As of December 31, 2014, Property-Liability has commitments to invest in additional limited partnership interests totaling $1.21 billion.

(2)Pre-tax yields are calculated as annualized investment income before investment expense (including dividend income in the case of equity securities) divided by the average of investment balances at the end of each quarter during the year. Investment balances, for purposes of the pre-tax yield calculation, exclude unrealized capital gains and losses.

(3)Average investment balances for the quarter are calculated as the average of the current and prior quarter investment balances. Year-to-date average investment balances are calculated as the average of investment balances at the beginning of the year and the end of each quarter during the year. For purposes of the average investment balances calculation, unrealized capital gains and losses are excluded.

58

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL

NET INVESTMENT INCOME, YIELDS AND REALIZED CAPITAL GAINS AND LOSSES (PRE-TAX)

($ in millions)

		Three months ended																								Twelve months ended
		Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Dec. 31,
		2014			2014			2014			2014			2013			2013			2013			2013			2014			2013
NET INVESTMENT INCOME
Fixed income securities	$	353		$	359		$	365		$	484		$	480		$	497		$	503		$	506		$	1,561		$	1,986
Equity securities		4			7			6			5			4			4			3			2			22			13
Mortgage loans		55			50			67			76			78			93			88			93			248			352
Limited partnership interests (1)		58			51			91			67			71			37			37			30			267			175
Short-term		1			-			1			-			-			-			-			1			2			1
Other		25			25			24			26			28			28			30			28			100			114
Subtotal		496			492			554			658			661			659			661			660			2,200			2,641
Less:  Investment expense		(16)			(19)			(16)			(18)			(24)			(26)			(28)			(25)			(69)			(103)
Net investment income	$	480		$	473		$	538		$	640		$	637		$	633		$	633		$	635		$	2,131		$	2,538
Net investment income, after-tax	$	313		$	307		$	350		$	416		$	424		$	423		$	422		$	424		$	1,386		$	1,693
PRE-TAX YIELDS (2)
Fixed income securities		5.3	%		5.3	%		5.3	%		5.4	%		5.0	%		5.1	%		5.0	%		4.8	%		5.3	%		5.0	%
Equity securities		1.6			2.3			2.7			2.4			2.8			2.4			3.0			2.6			2.3			2.7
Mortgage loans		5.8			5.3			6.8			5.5			5.4			6.4			5.9			6.2			5.8			6.0
Limited partnership interests		11.8			10.9			18.2			12.8			13.8			7.4			7.8			6.1			13.4			8.8
Total portfolio		5.5			5.4			5.9			5.7			5.3			5.2			5.1			5.0			5.6			5.1
REALIZED CAPITAL GAINS AND LOSSES  (PRE-TAX) BY ASSET TYPE
Fixed income securities	$	(3)		$	(1)		$	5		$	(4)		$	8		$	(12)		$	23		$	(18)		$	(3)		$	1
Equity securities		123			(5)			14			2			8			5			31			1			134			45
Mortgage loans		(1)			2			(2)			3			1			(6)			(6)			31			2			20
Limited partnership interests		1			28			(28)			(5)			(3)			-			(3)			-			(4)			(6)
Derivatives and other		5			4			1			5			-			(3)			12			5			15			14
Total	$	125		$	28		$	(10)		$	1		$	14		$	(16)		$	57		$	19		$	144		$	74
REALIZED CAPITAL GAINS AND LOSSES  (PRE-TAX) BY TRANSACTION TYPE
Impairment write-downs	$	(9)		$	2		$	-		$	(4)		$	(5)		$	(10)		$	(16)		$	(2)		$	(11)		$	(33)
Change in intent write-downs		(4)			(21)			(14)			(5)			(4)			(7)			(1)			(7)			(44)			(19)
Net other-than-temporary impairment losses recognized in earnings		(13)			(19)			(14)			(9)			(9)			(17)			(17)			(9)			(55)			(52)
Sales		133			43			1			8			23			6			62			21			185			112
Valuation and settlements of derivative instruments		5			4			3			2			-			(5)			12			7			14			14
Total	$	125		$	28		$	(10)		$	1		$	14		$	(16)		$	57		$	19		$	144		$	74
AVERAGE INVESTMENT BALANCES (in billions) (3)	$	36.3		$	36.6		$	37.3		$	37.7		$	49.7		$	50.3		$	51.9		$	53.2		$	37.0		$	44.8

(1)	As of December 31, 2014, Allstate Financial has commitments to invest in additional limited partnership interests totaling $1.22 billion.
(2)	Pre-tax yields are calculated as annualized investment income before investment expense (including dividend income in the case of equity securities) divided by the average of investment balances at the end of each quarter during the year.  Investment balances, for purposes of the pre-tax yield calculation, exclude unrealized capital gains and losses. Amounts related to investments classified as held for sale were excluded from the pre-tax yield calculation in 2014 and were included in the pre-tax yield calculation in 2013.
(3)	Average investment balances for the quarter are calculated as the average of the current and prior quarter investment balances. Year-to-date average investment balances are calculated as the average of investment balances at the beginning of the year and the end of each quarter during the year.  For purposes of the average investment balances calculation, unrealized capital gains and losses are excluded. Amounts related to investments classified as held for sale were excluded from average investment balances calculation in 2014 and were included in the average investment balances calculation in 2013.

59

THE ALLSTATE CORPORATION

INVESTMENT RESULTS

($ in millions)

	Three months ended																									Twelve months ended
		Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,			Dec. 31,			Dec. 31,
		2014			2014			2014			2014			2013			2013			2013			2013			2014			2013
Consolidated investment portfolio
Interest-bearing (1)	$	72,201		$	71,755		$	72,580		$	71,084		$	70,796		$	70,423		$	82,729		$	87,890		$	72,201		$	70,796
Equity/owned (2)		8,912			8,966			9,983			10,606			10,359			10,060			9,586			9,492			8,912			10,359
Total	$	81,113		$	80,721		$	82,563		$	81,690		$	81,155		$	80,483		$	92,315		$	97,382		$	81,113		$	81,155
Consolidated portfolio total return (3)
Interest-bearing		0.9	%		0.2	%		1.8	%		1.7	%		0.6	%		0.8	%		(1.4)	%		0.8	%		4.6	%		0.8	%
Equity/owned		0.2			0.2			0.4			0.4			0.6			0.3			-			0.4			1.4			1.3
Investment expenses		-			-			-			-			(0.1)			(0.1)			(0.1)			-			(0.2)			(0.3)
Total		1.1			0.4			2.2			2.1			1.1			1.0			(1.5)			1.2			5.8			1.8
Consolidated portfolio total return (3)
Income		1.0	%		1.0	%		1.1	%		1.1	%		1.1	%		1.0	%		1.0	%		1.0	%		4.1	%		4.1	%
Valuation		0.1			(0.6)			1.1			1.0			-			-			(2.5)			0.2			1.7			(2.3)
Total		1.1			0.4			2.2			2.1			1.1			1.0			(1.5)			1.2			5.8			1.8
Consolidated net investment income
Interest-bearing	$	675		$	672		$	695		$	824		$	819		$	861		$	868		$	895		$	2,866		$	3,443
Equity/owned		147			195			237			175			260			140			170			136			754			706
Investment expenses		(43)			(44)			(34)			(40)			(53)			(51)			(54)			(48)			(161)			(206)
Total	$	779		$	823		$	898		$	959		$	1,026		$	950		$	984		$	983		$	3,459		$	3,943
Consolidated Interest-bearing pre-tax yield (4)		3.9	%		3.9	%		4.0	%		4.1	%		4.1	%		4.3	%		4.3	%		4.3	%		4.0	%		4.2	%
Property-Liability net investment income
Interest-bearing excluding prepayment premiums and litigation proceeds	$	225		$	223		$	219		$	219		$	218		$	229		$	234		$	246		$	886		$	927
Prepayment premiums and litigation proceeds		9			8			12			13			9			4			10			15			42			38
Total Interest-bearing		234			231			231			232			227			233			244			261			928			965
Equity/owned		84			137			137			101			183			99			125			102			459			509
Less: Investment expenses		(24)			(24)			(17)			(21)			(28)			(23)			(26)			(22)			(86)			(99)
Total		294			344			351			312			382			309			343			341			1,301			1,375
Less: prepayment premiums and litigation proceeds		(9)			(8)			(12)			(13)			(9)			(4)			(10)			(15)			(42)			38
Total excluding prepayment premiums and litigation proceeds	$	285		$	336		$	339		$	299		$	373		$	305		$	333		$	326		$	1,259		$	1,337
Property-Liability interest-bearing pre-tax yield		2.8	%		2.8	%		2.9	%		3.0	%		2.9	%		3.1	%		3.2	%		3.5	%		2.9	%		3.2	%
Property-Liability interest-bearing pre-tax yield
excluding prepayment premiums and litigation proceeds		2.7	%		2.7	%		2.8	%		2.8	%		2.8	%		3.0	%		3.1	%		3.3	%		2.7	%		3.1	%
Allstate Financial net investment income
Interest-bearing excluding prepayment premiums and litigation proceeds	$	420		$	426		$	432		$	556		$	569		$	584		$	591		$	599		$	1,834		$	2,343
Prepayment premiums and litigation proceeds		13			7			24			28			15			32			27			27			72			101
Total interest-bearing		433			433			456			584			584			616			618			626			1,906			2,444
Equity/owned		63			59			98			74			77			43			43			34			294			197
Less: Investment expenses		(16)			(19)			(16)			(18)			(24)			(26)			(28)			(25)			(69)			(103)
Total		480			473			538			640			637			633			633			635			2,131			2,538
Less: prepayment premiums and litigation proceeds		(13)			(7)			(24)			(28)			(15)			(32)			(27)			(27)			(72)			(101)
Total excluding prepayment premiums and litigation proceeds	$	467		$	466		$	514		$	612		$	622		$	601		$	606		$	608		$	2,059		$	2,437
Allstate Financial interest-bearing pre-tax yield		5.2	%		5.2	%		5.3	%		5.3	%		5.0	%		5.2	%		5.0	%		4.9	%		5.2	%		5.0	%
Allstate Financial interest-bearing pre-tax yield
excluding prepayment premiums and litigation proceeds		5.0	%		5.1	%		5.0	%		5.0	%		4.8	%		4.9	%		4.8	%		4.7	%		5.0	%		4.8	%

(1)Includes fixed income securities, mortgage loans, short-term and other investments.

(2)Includes limited partnership interests, equity securities and real estate.

(3)Total return on investment portfolio is calculated from GAAP results including the total of net investment income, realized capital gains and losses, the change in unrealized net capital gains and losses, and the change in the difference between fair value and carrying value of mortgage loans and cost method limited partnerships, divided by the average fair value balances.  Amounts related to investments classified as held for sale were excluded from the total return calculation in 2014 and were included in the total return calculation in 2013.

(4)Pre-tax interest-bearing yield is calculated as annualized interest-bearing investment income before investment expense divided by the average of interest-bearing investment balances at the end of each quarter during the year.  Interest-bearing investment balances, for purposes of the pre-tax interest-bearing yield calculation, exclude unrealized capital gains and losses. Amounts related to investments classified as held for sale were excluded from the pre-tax interest-bearing yield calculation in 2014 and were included in the pre-tax interest-bearing yield calculation in 2013.

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Definitions of Non-GAAP Measures

We believe that investors’ understanding of Allstate’s performance is enhanced by our disclosure of the following non-GAAP measures.  Our methods for calculating these measures may differ from those used by other companies and therefore comparability may be limited.

Operating income is net income available to common shareholders, excluding:

- realized capital gains and losses, after-tax, except for periodic settlements and accruals on non-hedge derivative instruments, which are reported with realized capital gains and losses but included in operating income,

- valuation changes on embedded derivatives that are not hedged, after-tax,

- amortization of deferred policy acquisition costs (“DAC”) and deferred sales inducements (“DSI”), to the extent they resulted from the recognition of certain realized capital gains and losses or valuation changes on embedded derivatives that are not hedged, after-tax,

- amortization of purchased intangible assets, after-tax,

- gain (loss) on disposition of operations, after-tax, and

- adjustments for other significant non-recurring, infrequent or unusual items, when (a) the nature of the charge or gain is such that it is reasonably unlikely to recur within two years, or (b) there has been no similar charge or gain within the prior two years.

Net income available to common shareholders is the GAAP measure that is most directly comparable to operating income.   We use operating income as an important measure to evaluate our results of operations.  We believe that the measure provides investors with a valuable measure of the Company’s ongoing performance because it reveals trends in our insurance and financial services business that may be obscured by the net effect of realized capital gains and losses, valuation changes on embedded derivatives that are not hedged, amortization of purchased intangible assets, gain (loss) on disposition of operations and adjustments for other significant non-recurring, infrequent or unusual items.  Realized capital gains and losses, valuation changes on embedded derivatives that are not hedged and gain (loss) on disposition of operations  may vary significantly between periods and are generally driven by business decisions and external economic developments such as capital market conditions, the timing of which is unrelated to the insurance underwriting process.  Consistent with our intent to protect results or earn additional income, operating income includes periodic settlements and accruals on certain derivative instruments that are reported in realized capital gains and losses because they do not qualify for hedge accounting or are not designated as hedges for accounting purposes.  These instruments are used for economic hedges and to replicate fixed income securities, and by including them in operating income, we are appropriately reflecting their trends in our performance and in a manner consistent with the economically hedged investments, product attributes (e.g. net investment income and interest credited to contractholder funds) or replicated investments.  Amortization of purchased intangible assets is excluded because it relates to the acquisition purchase price and is not indicative of our underlying insurance business results or trends. Non-recurring items are excluded because, by their nature, they are not indicative of our business or economic trends.  Accordingly, operating income excludes the effect of items that tend to be highly variable from period to period and highlights the results from ongoing operations and the underlying profitability of our business.  A byproduct of excluding these items to determine operating income is the transparency and understanding of their significance to net income variability and profitability while recognizing these or similar  items may recur in subsequent periods.  Operating income is used by management along with the other components of net income available to common shareholders to assess our performance.  We use adjusted measures of operating income in incentive compensation.  Therefore, we believe it is useful for investors to evaluate net income available to common shareholders, operating income and their components separately and in the aggregate when reviewing and evaluating our performance.  We note that investors, financial analysts, financial and business media organizations and rating agencies utilize operating income results in their evaluation of our and our industry’s financial performance and in their investment decisions, recommendations and communications as it represents a reliable, representative and consistent measurement of the industry and the Company and management’s performance.  We note that the price to earnings multiple commonly used by insurance investors as a forward-looking valuation technique uses operating income as the denominator.  Operating income should not be considered a substitute for net income available to common shareholders and does not reflect the overall profitability of our business.  A reconciliation of operating income to net income available to common shareholders is provided in the schedule, “Contribution to Income”.

Underwriting income is calculated as premiums earned, less claims and claims expense (“losses”), amortization of DAC, operating costs and expenses and restructuring and related charges as determined using GAAP.  Management uses this measure in its evaluation of the results of operations to analyze the profitability of our Property-Liability insurance operations separately from investment results.  It is also an integral component of incentive compensation.  It is useful for investors to evaluate the components of income separately and in the aggregate when reviewing  performance.  Net income available to common shareholders is the most directly comparable GAAP measure.  Underwriting income should not be considered a substitute for net income available to common shareholders and does not reflect the overall profitability of our business.  A reconciliation of Property-Liability underwriting income to net income available to common shareholders is provided in the schedule, “Property-Liability Results”.

Combined ratio excluding the effect of catastrophes is a non-GAAP ratio, which is computed as the difference between two GAAP operating ratios:  the combined ratio and the effect of catastrophes on the combined ratio.  The most directly comparable GAAP measure is the combined ratio.  We believe that this ratio is useful to investors and it is used by management to reveal the trends in our Property-Liability business that may be obscured by catastrophe losses.  Catastrophe losses cause our loss trends to vary significantly between periods as a result of their incidence of occurrence and magnitude and can have a significant impact on the combined ratio.  We believe it is useful for investors to evaluate these components separately and in the aggregate when reviewing our underwriting performance.  The combined ratio excluding the effect of catastrophes should not be considered a substitute for the combined ratio and does not reflect the overall underwriting profitability of our business.  A reconciliation of combined ratio excluding the effect of catastrophes to combined ratio is provided in the schedule, “Property-Liability Results”.

Combined ratio excluding the effect of catastrophes, prior year reserve reestimates and amortization of purchased intangible assets (“underlying combined ratio”) is a non-GAAP ratio, which is computed as the difference between four GAAP operating ratios: the combined ratio, the effect of catastrophes on the combined ratio, the effect of prior year non-catastrophe reserve reestimates on the combined ratio and the effect of amortization of purchased intangible assets on the combined ratio.   We believe that this ratio is useful to investors and it is used by management to reveal the trends in our Property-Liability business that may be obscured by catastrophe losses, prior year reserve reestimates and amortization of purchased intangible assets.  Catastrophe losses cause our loss trends to vary significantly between periods as a result of their incidence of occurrence and magnitude, and can have a significant impact on the combined ratio.  Prior year reserve reestimates are caused by  unexpected loss development on historical reserves.  Amortization of purchased intangible assets relates to the acquisition purchase price and is not indicative of our underlying insurance business results or trends.  We believe it is useful for investors to evaluate these components separately and in the aggregate when reviewing our underwriting performance.  We also provide it to facilitate a comparison to our outlook on the underlying combined ratio. The most directly comparable GAAP measure is the combined ratio.  The underlying combined ratio should not be considered a substitute for the combined ratio and does not reflect the overall underwriting profitability of our business. A reconciliation of the underlying combined ratio to combined ratio is provided in the schedules “Allstate Brand Profitability Measures”, “Encompass Brand Profitability Measures” , “Esurance Brand Profitability Measures”, “Auto, Homeowners and Other Personal Lines Underlying Combined Ratios”, “Allstate Personal Lines Profitability Measures” and “Emerging Businesses Profitability Measures”.

Average underlying loss (incurred pure premium) and expense is calculated as the underlying combined ratio (a non-GAAP measure) multiplied by the GAAP  quarterly earned premium, which is annualized (multiplied by 4) (“average premium”).  We believe that this measure is useful to investors and it is used by management for the same reasons noted above for the underlying combined ratio.  A reconciliation of average underlying loss and expense is provided in the schedule,  “Allstate Brand Auto and Homeowners Underlying Loss and Expense”.

Esurance brand underlying loss ratio is a non-GAAP ratio, which is computed as the difference between three GAAP operating ratios: the loss ratio, the effect of catastrophes on the combined ratio and the effect of prior year non-catastrophe reserve reestimates on the combined ratio.  We believe that this ratio is useful to investors and it is used by management to reveal the trends in the Esurance business that may be obscured by catastrophe losses and prior year reserve reestimates.  Catastrophe losses cause our loss trends to vary significantly between periods as a result of their incidence of occurrence and magnitude, and can have a significant impact on the combined ratio.  Prior year reserve reestimates are caused by unexpected loss development on historical reserves.  We believe it is useful for investors to evaluate these components separately and in the aggregate when reviewing our underwriting performance.  The most directly comparable GAAP measure is the loss ratio. The underlying loss ratio should not be considered a substitute for the loss ratio and does not reflect the overall loss ratio of our business. A reconciliation of Esurance brand underlying loss ratio is provided in the schedule, “Esurance Brand Profitability Measures and Statistics”.

Operating income return on common shareholders’ equity is a ratio that uses a non-GAAP measure. It is calculated by dividing the rolling 12-month operating income by the average of common shareholders’ equity at the beginning and at the end of the 12-months, after excluding the effect of unrealized net capital gains and losses. Return on common shareholders’ equity is the most directly comparable GAAP measure.  We use operating income as the numerator for the same reasons we use operating income, as discussed above. We use average common shareholders’ equity excluding the effect of unrealized net capital gains and losses for the denominator as a representation of common shareholders’ equity primarily attributable to the Company’s earned and realized business operations because it eliminates the effect of items that are unrealized and vary significantly between periods due to external economic developments such as capital market conditions like changes in equity prices and interest rates, the amount and timing of which are unrelated to the insurance underwriting process.  We use it to supplement our evaluation of net income available to common shareholders and return on common shareholders’ equity because it excludes the effect of items that tend to be highly variable from period to period.  We believe that this measure is useful to investors and that it provides a valuable tool for investors when considered along with return on common shareholders’ equity because it eliminates the after-tax effects of realized and unrealized net capital gains and losses that can fluctuate significantly from period to period and that are driven by economic developments, the magnitude and timing of which are generally not influenced by management.  In addition, it eliminates non-recurring items that are not indicative of our ongoing business or economic trends. A byproduct of excluding the items noted above to determine operating income return on common shareholders’ equity from return on common shareholders’ equity is the transparency and understanding of their significance to return on common shareholders’ equity variability and profitability while recognizing these or similar items may recur in subsequent periods. We use adjusted measures of operating income return on common shareholders’ equity in incentive compensation.  Therefore, we believe it is useful for investors to have operating income return on common shareholders’ equity and return on common shareholders’ equity when evaluating our performance.  We note that investors, financial analysts, financial and business media organizations and rating agencies utilize operating income return on common shareholders’ equity results in their evaluation of our and our industry’s financial performance and in their investment decisions, recommendations and communications as it represents a reliable, representative and consistent measurement of the industry and the company and management’s utilization of capital.  Operating income return on common shareholders’ equity should not be considered a substitute for return on common shareholders’ equity and does not reflect the overall profitability of our business.  A reconciliation of return on common shareholders’ equity and operating income return on common shareholders’ equity can be found in the schedule, “Return on Common Shareholders’ Equity”.

Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, is a ratio that uses a non-GAAP measure.  It is calculated by dividing common shareholders’ equity after excluding the impact of unrealized net capital gains and losses on fixed income securities and related DAC, DSI and life insurance reserves by total common shares outstanding plus dilutive potential common shares outstanding.  We use the trend in book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, in conjunction with book value per common share to identify and analyze the change in net worth attributable to management efforts between periods.  We believe the non-GAAP ratio is useful to investors because it eliminates the effect of items that can fluctuate significantly from period to period and are generally driven by economic developments, primarily capital market conditions, the magnitude and timing of which are generally not influenced by management, and we believe it enhances understanding and comparability of performance by highlighting underlying business activity and profitability drivers.  We note that book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, is a measure commonly used by insurance investors as a valuation technique.  Book value per common share is the most directly comparable GAAP measure.  Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, should not be considered as a substitute for book value per common share, and does not reflect the recorded net worth of our business.  A reconciliation of book value per common share, excluding the impact of unrealized net capital gains on fixed income securities, and book value per common share can be found in the schedule, “Book Value per Common Share”.

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