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): October 29, 2014

THE ALLSTATE CORPORATION

(Exact name of registrant as specified in its charter)

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 October 29, 2014, the registrant issued a press release announcing its financial results for the third quarter of 2014, and the availability of the registrant’s third 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

99.1                                                Registrant’s press release dated October 29, 2014

99.2                                                Third 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.

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Exhibit 99.1

FOR IMMEDIATE RELEASE

Allstate Reports Broad-Based Growth and Strong Profitability

NORTHBROOK, Ill., October 29, 2014 – The Allstate Corporation (NYSE: ALL) today reported financial results for the third quarter of 2014. The financial highlights were:

“Allstate grew across brands and customer segments while generating excellent profitability, despite a significant increase in losses from severe weather. The combination of a unique strategy and operational focus continues to improve our competitive position and create value for shareholders,” said Thomas J. Wilson, chairman, president and CEO of The Allstate Corporation. “Over the last year, we added 790,000 policies in force, a 2.4% improvement, and net written premiums increased by $1.4 billion for the trailing twelve months. The Allstate brand increased both auto and homeowners policies, reflecting the execution of a comprehensive growth plan. Esurance continued to increase its market share of the self-serve branded segment, although policy growth moderated to 14.1% in the third quarter given profit improvement initiatives. Similarly, policy growth at Encompass slowed to 3.1% over the prior year quarter,” continued Wilson.

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“Profitability was also strong and consistent with our strategic direction and a proactive approach to managing risk and return. Net income was $750 million and operating income was $598 million for the quarter, as the underlying combined ratio was better than the annual outlook range of 87 - 89 and limited partnership results were higher than the prior year. The strategic decision to deploy capital out of the life and annuity businesses is progressing well, but resulted in lower Allstate Life and Retirement operating income. Shareholders continued to realize good returns, with an operating income return on equity of 13.0% and $1.05 billion of dividends and share repurchases in the third quarter.”

Third Quarter 2014 Financial Results

·                  Written premiums for the trailing twelve months ended September 30, 2014 increased by $1.4 billion to $29.3 billion, or 5.1%, over the trailing twelve months ended September 30, 2013 of $27.9 billion. Allstate Protection written premiums were $367 million higher in the quarter versus the third quarter of 2013. Allstate brand written premiums increased $303 million, or 4.5%, Esurance premiums rose $50 million, or 14.0%, and Encompass premiums increased $14 million, or 4.3%, compared to third quarter 2013. Allstate Financial premiums and contract charges of $512 million declined by 12.3% for the third quarter of 2014 from the year-earlier period due to the sale of Lincoln Benefit Life Company (LBL).

·                  Third quarter 2014 net income available to common shareholders was $750 million, or $1.74 per diluted common share, compared to $310 million, or $0.66 per diluted common share, in the third quarter of 2013. The quarterly comparison was affected by a number of after-tax items in the 2013 quarter, including a $475 million estimated loss on the disposition of LBL and a $118 million postretirement benefits curtailment gain.

·                  Operating income was $598 million, or $1.39 per diluted common share, in the third quarter of 2014, compared to $713 million, or $1.53 per diluted common share, in the same period of 2013. The decrease in operating income was driven by catastrophe losses of $517 million, pre-tax, which were $389 million higher than the prior year quarter.

·                  The recorded Property-Liability combined ratio was 93.5 for the third quarter of 2014, 3.5 points unfavorable to the prior year quarter due to greater catastrophe losses. The underlying combined ratio of 86.1 for the third quarter was 0.8 points better than the same period of last year, reflecting the continued strong performance of the Allstate brand. While Esurance’s loss ratio improved from the prior year quarter, growth investments continue to impact the combined ratio and recorded earnings. Encompass is also continuing its profit improvement initiatives.

·                  Allstate Financial recorded net income of $116 million in the third quarter, compared to a net loss of $360 million in the prior year quarter, which included the initial estimated loss on the disposition of LBL. Operating income declined 1.6% to $125 million from the same quarter a year ago as the absence of $55 million of income from the disposed LBL business was offset by lower deferred acquisition cost unlocking charges in 2014.

·                  Total net investment income was $823 million in the third quarter of 2014, and included $162 million from limited partnership interests. Property-Liability net investment income increased by $35 million, or 11.3% in the third quarter of 2014 compared to the prior year quarter, due to higher limited partnership income, partially offset by lower fixed income yields due to rate risk reduction actions. Allstate Financial net investment income declined by $160 million in the third quarter of 2014 compared to the same period of 2013 on lower investment balances resulting from the sale of LBL and continuing run-off of deferred annuities.

2014 Operating Priorities

Grow insurance policies in force. Allstate Protection insurance policies in force increased by 790,000, or 2.4%, in the third quarter of 2014 versus the same period last year, reflecting broad-based geographic growth across customer segments and product offerings.

·                  The Allstate brand grew insurance policies in force by 572,000, or 1.9% in the third quarter of 2014 compared to the prior year quarter, after reflecting a comprehensive plan to generate profitable growth. This growth was driven by an increase of 504,000 Allstate auto policies, 2.6% higher than the third quarter of 2013, and a modest increase of 5,000 or 0.1% in Allstate

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homeowners policies.  Allstate brand other personal lines increased by 70,000 policies in the third quarter of 2014, 1.7% higher than the 2013 quarter, reflecting the ongoing focus on providing complete household solutions through a broad range of products.

·                  Esurance grew insurance policies in force by 14.1%, or 179,000 policies, in the third quarter of 2014 versus the same period a year ago. Esurance’s rate of policy growth has continued to slow from prior quarters due to the impact of ongoing profit improvement actions designed to improve the underlying loss ratio and the increased size of the business.

·                  Encompass grew insurance policies in force by 3.1%, or 39,000 policies, in the third quarter of 2014 compared with the same quarter of 2013.

Maintain the underlying combined ratio. The Property-Liability underlying combined ratio of 86.1 in the third quarter of 2014 was 0.8 points better than in the prior year quarter.

·                  The Allstate brand combined ratio was 89.8 in the third quarter, with an underlying combined ratio of 84.2, 1.2 points better than in the prior year quarter. Allstate brand auto had a third quarter 2014 combined ratio of 93.1 and an underlying combined ratio of 92.9, 1.4 points better than in the prior year quarter. Allstate brand homeowners recorded a combined ratio of 81.2 and an underlying combined ratio of 60.0, 1.8 points better than in the third quarter of 2013.

·                  Esurance recorded a third quarter 2014 combined ratio of 116.6 and an underlying combined ratio of 112.3, 0.8 points higher than the prior year quarter. Esurance profitability continues to be negatively impacted by growth initiatives, including aggressive advertising and expansion into renters, motorcycle and homeowners product lines and new geographic markets. The Esurance underlying loss ratio* was 75.3 for the third quarter of 2014, 2.1 points better than the same period of 2013, benefiting from ongoing profit improvement actions.

·                  In the Encompass brand, the third quarter combined ratio was 109.7, 16.1 points higher than the third quarter of 2013, due to higher catastrophe losses. The underlying combined ratio of 95.6 was 3.1 points higher than the third quarter of 2013. The Encompass team continues to implement pricing, underwriting and agency management actions to achieve its desired returns.

Proactively manage our investments to generate attractive risk-adjusted returns. Net investment income was 13.4% lower than the third quarter of 2013 due to a $12 billion reduction in the portfolio associated with the LBL divestiture, the decision to shorten the Property-Liability fixed income portfolio duration, and lower prepayment fees and litigation proceeds.

·                  The annualized portfolio yield in the third quarter of 2014 was 4.4%, essentially flat from the prior year quarter, as strong limited partnership results more than offset a lower contribution from the interest-bearing portfolio. Portfolio total return for the third quarter of 2014 was 0.4%, and 4.7% for the first nine months of 2014.

·                  Limited partnership interests contributed income of $162 million in the third quarter, 52.8% higher than the prior year quarter, due to continued favorable valuations and strong cash distributions.

·                  Allstate’s consolidated investment portfolio totaled $80.7 billion at September 30, 2014 compared to $81.2 billion at December 31, 2013, which excluded LBL investments held for sale.

Operational priorities. Allstate is making progress on modernizing its operating model and building long-term growth platforms.

·                  The Allstate brand continues to evolve its agency force to a trusted advisor model and is expanding into more local markets.

·                  Investments are being made to improve customer value propositions by enhancing customer service and lowering costs. This includes simplifying technology applications and using continuous improvement programs to improve effectiveness and efficiency.

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·                  Esurance continued to expand its geographic reach and product portfolio, offering auto insurance in 43 states, renters insurance in 18 states, homeowners insurance in 11 states and motorcycle insurance in 10 states as of September 30, 2014.

·                  We enhanced the Drivewise® telematics offering with the addition of a mobile phone-based application in 16 states.

Creating Shareholder Value Through Capital Management

“We continued to create shareholder value through capital management,” said Steve Shebik, chief financial officer. “During the third quarter, we returned $1.05 billion to shareholders through common stock dividends and repurchasing 3.6% of our outstanding shares. Book value per diluted common share increased 11.0% from a year ago, to $48.28 at the end of the third quarter of 2014.”

Statutory surplus at September 30, 2014 was an estimated $18.0 billion for the combined insurance operating companies, an increase of $0.7 billion from September 30, 2013. Property-Liability statutory surplus was an estimated $15.1 billion of this total, with Allstate Financial companies accounting for the remainder. During the third quarter, Allstate repaid $650 million of 5.0% senior notes from available capital resources.

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, October 30.

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 its Allstate, Encompass, Esurance and Answer Financial brand names and Allstate Financial business segment. 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.

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THE ALLSTATE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

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THE ALLSTATE CORPORATION

BUSINESS RESULTS

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THE ALLSTATE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

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THE ALLSTATE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

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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 and operating income per diluted common share 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.

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