Allstate Corp Receives Affirmed Credit Ratings from AM Best Amidst Economic Challenges and Catastrophic Events

Allstate Corp's credit ratings have been affirmed by AM Best, with a Financial Strength Rating of A+ (Superior) and Long-Term Issuer Credit Ratings of "aa-" (Superior). The company's robust balance sheet, strong operating performance, and effective enterprise risk management were key factors in the affirmation. However, economic challenges and catastrophic events have negatively affected its financial results, and certain subsidiaries have a negative outlook.

AM Best, a leading global credit rating agency, has affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of "aa-" (Superior) for Allstate Corporation (Allcorp) [NYSE: ALL]. This affirmation underscores the company's robust balance sheet, strong operating performance, and effective enterprise risk management [1].

The ratings reflect Allstate's favorable market position in the private passenger auto and homeowners' markets. The organization's extensive reach and distribution capabilities have historically contributed to sustained profitability and robust cash flow. However, economic challenges and increased pressures from catastrophic events have adversely affected Allstate's underwriting and financial results in 2022 and 2023 [1].

In response to these challenges, Allstate has implemented a comprehensive profit improvement plan, which includes increasing rates, enhancing underwriting standards, and expense reductions. These measures have resulted in materially improved margins in 2024 and through the first six months of 2025 [1].

As a result of stronger earnings, Allstate's risk-adjusted capitalization has benefited from almost 30% statutory surplus growth in 2024. The risk-adjusted capitalization as measured by Best Capital Adequacy Ratio (BCAR) improved compared to 2023 levels, though it remains below historical levels [1].

AM Best also affirmed the FSR of A- (Excellent) and the Long-Term ICR of "a-" (Excellent) for the ASMI Auto Group members, reflecting their very strong balance sheet strength and adequate operating performance. The ratings of First Colonial Insurance Company (FCIC) in Jacksonville, FL, were affirmed at A (Excellent) and "a" (Excellent), benefiting from the explicit and implicit support provided by Allcorp [1].

The ratings of National Health Insurance Company in Dallas, TX, reflect their strongest balance sheet strength, adequate operating performance, and neutral business profile. National General Insurance Ltd. (NGIL) in Bermuda received an affirmation at A (Excellent) and "a+" (Excellent), reflecting its very strong balance sheet strength and adequate operating performance [1].

Allstate New Jersey Insurance Group, headquartered in Bridgewater, NJ, received a negative outlook due to operating results falling below the strong level in the last several years. Castle Key Group, based in Northbrook, IL, saw its Long-Term ICR outlook revised to positive from stable, reflecting improvements in operating performance metrics [1].

AM Best's ratings provide a comprehensive assessment of Allstate's financial health, highlighting its strengths and areas for improvement. The company's ability to adapt to economic challenges and maintain strong financial flexibility will be critical to sustaining its positive credit ratings [1].

References:
[1] https://www.marketscreener.com/news/am-best-affirms-credit-ratings-of-the-allstate-corporation-and-its-core-subsidiaries-ce7c50dcda8af623