- Total Revenues: $18.6 billion, up 11.8% from the second quarter of 2025.
- Net Income: $3.2 billion for the second quarter.
- Adjusted Net Income: $2.3 billion, or $8.99 per diluted share.
- Adjusted Net Income (First Half): $5.1 billion, or $19.65 per diluted share.
- Adjusted Net Income Return on Equity: 44.2% over the last 12 months.
- Net Premiums Written: Increased 2.6%.
- Net Investment Income: Increased 33.8% to $1 billion.
- Property-Liability Net Premiums Earned: Increased 4% to $14.9 billion.
- Property-Liability Combined Ratio: Improved 4.5 points to 86.6%.
- Property-Liability Underlying Combined Ratio: 79.4%, in line with the prior year quarter.
- Auto Insurance Combined Ratio: 83.3%, improving 2.7 points from the prior year.
- Homeowners Insurance Combined Ratio: 94.6%, improving 7.4 points.
- Underwriting Income: $2 billion, an increase of nearly 57% from the prior year.
- Auto Claim Reserve Releases: Totaled $1.5 billion this year.
- Auto Premium per Policy: $1,486 in the second quarter, down slightly from the second quarter of 2025.
- Adjusted Underlying Loss and Expense per Policy (Auto): $1,337.
- Advertising Investment: $1.1 billion in the first half of the year.
- Auto Insurance New Business: Increased to 2.3 million items in the quarter.
- Homeowners Insurance New Business: Increased by 46.8% to 411,000 policies.
- Auto Insurance Policy Growth: 2.8% this quarter.
- Homeowners Insurance Policy Growth: 2.9% this quarter.
- Total Policies in Force: Increased 3.8% to $215.9 million.
- Protection Services Policies in Force: 177 million.
- Protection Services Revenue: $3.4 billion in the last 12 months.
- Protection Services Adjusted Net Income: Over $200 million in the last 12 months.
- Capital Returned to Shareholders: $1.3 billion during the quarter, including $1 billion of common shares repurchased.
- Deployable Capital at Holding Company: Increased to $9.5 billion, or approximately $37 per common share outstanding.
Release Date: August 06, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Allstate Corp ALL delivered exceptional Q2 2026 results with net income of $3.2 billion and adjusted net income of $2.3 billion ($8.99 per share), reflecting strong operational performance.
- Property-Liability combined ratio improved by 4.5 points to 86.6%, driven by a 2.7-point improvement in auto (83.3%) and a 7.4-point improvement in homeowners (94.6%), showcasing superior underwriting discipline.
- Net premiums written grew 2.6% with a 9.9% increase in issued applications, and total policies in force rose 3.8% to 215.9 million, indicating successful market share gains.
- Net investment income surged 33.8% to $1 billion, supported by a larger portfolio, lengthened duration, and increased performance-based income, contributing to a 44.2% adjusted net income return on equity over the last 12 months.
- The company returned $1.3 billion to shareholders in Q2, including $1 billion in share repurchases, with $2.6 billion remaining under the $4 billion authorization, and deployable capital at the holding company increased to $9.5 billion.
- Allstate Corp (ALL) continues to leverage its technology-driven strategy, including the ALLIE AI ecosystem, to enhance customer value, lower costs, and drive growth, with over 250 analytical models and 40 petabytes of data.
Negative Points
- The Property-Liability expense ratio increased by 1 point in Q2, with about half attributed to higher advertising and the remainder from nonrecurring legal expenses, which could pressure margins.
- Auto insurance rate changes were flat in Q2 (net impact of zero), and the company faces competitive pressure, potentially limiting future pricing power.
- Bodily injury severity trends remain elevated, and the company acknowledges uncertainty in forward-looking severity, which could impact future loss ratios.
- The company's growth in homeowners insurance, while strong, increases exposure to catastrophe losses, and management noted the need to manage this risk carefully.
- Despite strong reserve releases, the company cautions that it does not assume future releases, and the volatility in prior-year reserve estimates could create earnings unpredictability.
- The transition to new CFO Chris Lown and ongoing technology investments, including ALLIE, may involve execution risks and could lead to higher costs in the near term.
Q & A Highlights
Q: Can you provide perspective on how you're managing the costs and measuring the ROI of your technology initiatives, including ALLIE, and whether you will eventually move off all legacy systems?
A: Thomas Wilson (Chairman, President, and CEO): We are a technology and analytics-driven company, and AI is another step along that continuum. We are not facing barriers to investing and getting good returns. Regarding legacy systems, we are moving to the "Connected Customer Cloud" (C3) to standardize platforms, but the orchestration layer built during transformative growth allows us to access legacy systems via APIs without needing to eliminate them all. Token costs are not an issue for us.
Q: Given the strong capital position with $9.5 billion in deployable capital, is it prudent to continue aggressive share repurchases, or should you hold cash for potential acquisitions?
A: Thomas Wilson (Chairman, President, and CEO): We are committed to completing the $4 billion repurchase authorization. We manage capital holistically, considering organic growth, investments, and acquisitions. We have a strong track record of deploying capital effectively, such as with Square Trade and National General, and we generate enough capital to pursue multiple value-creation opportunities simultaneously.
Q: How should we think about the normalization of auto insurance profitability given the current underlying combined ratio of 88.5% year-to-date versus your mid-90s target?
A: Thomas Wilson (Chairman, President, and CEO): Slide 8 demonstrates our ability to adapt quickly, as we improved the combined ratio by over 7 points in a year during the inflationary period. We don't have a specific goal to reach the mid-90s; we aim to grow as fast as possible while earning attractive returns. We are currently growing and generating excellent returns on capital, which is good for shareholders.
Q: Can you discuss the competitive environment for monoline auto versus bundled home and auto, and whether there is a divergence in growth opportunities?
A: Thomas Wilson (Chairman, President, and CEO): We focus on the customer and meeting all their needs, not just individual products. The nonstandard auto market is competitive, but National General has given us expertise there. In bundled products, we are strong, with record cross-line sales from Allstate agents. Jesse Merten (President, Property-Liability) added that go-to-market teams, like in Illinois, optimize across all channels—exclusive agents, direct, and independent agents—to maximize growth and meet customers where they are.
Q: Given the favorable severity development, is it fair to say there is not much loss pressure pushing the combined ratio higher, and will this continue?
A: Jesse Merten (President, Property-Liability): We don't provide forward-looking severity guidance, but the pure premium trend was down for the quarter. While physical damage severities are moderating, bodily injury severity trends remain at relatively high levels. We are managing claims operationally, but inflation impacts on parts and labor, along with BI severity, will determine future margins. Currently, we have solid margins based on the gap between average premium and pure premium trend.
Q: How do you expect the results of ALLIE to show up in the income statement, particularly between expense, loss ratio, and growth?
A: Thomas Wilson (Chairman, President, and CEO): ALLIE should positively impact all areas. It will help reduce expenses by taking work out of agent offices and improving efficiency. It will enhance pricing and claims accuracy, and Agentic AI will connect our sophisticated capabilities to improve growth effectiveness. While we can't provide specific numbers, we are optimistic about the opportunities.
Q: Where do you see new application growth in personal auto moving, given the current high single-digit growth versus 25% last year?
A: Jesse Merten (President, Property-Liability): We believe we can continue to fuel growth in new issued applications across all three channels. We are investing in direct channel sophistication, improving exclusive agent productivity, and gaining traction in the independent agent channel with bundled products like Custom 360. We feel confident in our ability to drive new business going forward.
Q: How has personal auto retention been trending, and have you seen benefits from programs like SAVE?
A: Jesse Merten (President, Property-Liability): Retention has stabilized recently. While there are many shoppers, it's not more than a year ago. Programs like SAVE have had a retention benefit for targeted customers. At a granular level, by segment and product type, retention trends are stable, and SAVE was the right decision.
Q: Can you continue to grow homeowners policies at this fast pace without adding material catastrophe load, and what is your appetite for monoline homeowners?
A: Thomas Wilson (Chairman, President, and CEO): We are good at homeowners and have room to gain market share. We manage catastrophe risk well with a robust reinsurance program and have no restrictions on accessing capital. We don't restrict monoline homeowners; we want each product to stand on its own and avoid subsidization. We are improving pricing accuracy and analytics to continue growing in this line.
Q: What is generating the favorable prior year reserve reestimates in auto, and can this continue?
A: Thomas Wilson (Chairman, President, and CEO): We believe our reserves are as accurate as possible each quarter. Releases occur when estimates are higher than actuals, often due to declining inflationary trends, such as tort reform in Florida. We are hopeful for continued positive trends. John Dugenske (President, Investments and Corporate Strategy) added that the post-COVID inflationary period was volatile, and our consistent estimation process, with external auditors, has allowed us to adjust aggressively as new data emerges.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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