SEC Filing | The Allstate Corporation

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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 7, 2018

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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).



		Emerging growth company	____

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ____

Section 2 – Financial Information

Item 2.02. Results of Operations and Financial Condition.

The Registrant’s press release dated February 7, 2018, announcing its financial results for the fourth quarter of 2017, and the Registrant’s fourth quarter 2017 investor supplement are furnished as Exhibits 99.1 and 99.2, respectively, 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 February 7, 2018

99.2 Fourth quarter 2017 Investor Supplement of The Allstate Corporation

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/ Eric K. Ferren
	Name: Eric K. Ferren
	Title: Senior Vice President, Controller and Chief Accounting Officer

Date: February 7, 2018

Exhibit

Exhibit 99.1

https://cdn.kscope.io/535072f965e27a00ddb74cf31dff24ae-earningsreleaseimagea10.jpg

FOR IMMEDIATE RELEASE

Contacts:

Greg Burns John Griek

Media Relations Investor Relations

(847) 402-5600 (847) 402-2800

Allstate Delivers Strong Results

Positioned for profitable growth in 2018

NORTHBROOK, Ill., February 7, 2018 – The Allstate Corporation (NYSE: ALL) today reported financial results for the fourth quarter of 2017.



The Allstate Corporation Consolidated Highlights
	Three months ended December 31,						Twelve months ended December 31,
($ in millions, except per share data and ratios)	2017		2016		% / pts Change		2017			2016			% / pts Change
Consolidated revenues	$	9,843	$	9,278	6.1		$	38,524		$	36,534		5.4
Net income applicable to common shareholders⁽¹⁾	1,220		811		50.4		3,073			1,761			74.5
per diluted common share	3.35		2.18		53.7		8.36			4.67			79.0
Adjusted net income*⁽²⁾	762		807		(5.6	)	2,467			1,838			34.2
per diluted common share*	2.09		2.17		(3.7	)	6.71			4.87			37.8
Return on common shareholders’ equity (trailing twelve months)
Net income applicable to common shareholders							15.5		%	9.5		%	6.0
Adjusted net income*							13.3		%	10.4		%	2.9
Book value per common share							57.58			50.77			13.4
Property-Liability combined ratio
Recorded	91.0		89.7		1.3		93.6			96.0			(2.4	)
Underlying combined ratio* (excludes catastrophes, prior year reserve reestimates and amortization of purchased intangibles)	85.7		87.4		(1.7	)	84.9			87.6			(2.7	)
Underlying combined ratio* as historically reported (includes Service Businesses)							85.6			87.9			(2.3	)
Catastrophe losses	599		303		97.7		3,234			2,572			25.7
Total policies in force (in thousands)							82,276			43,811			87.8


⁽¹⁾	2017 results include a tax legislation benefit of $506 million related to the Tax Cuts and Jobs Act of 2017, primarily due to the revaluation of Allstate’s deferred tax assets and liabilities. The impact of tax legislation is excluded from adjusted net income.


⁽²⁾	In the fourth quarter, Allstate discontinued the use of the term “operating income” and replaced the label with “adjusted net income”.


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

“In 2017, Allstate excelled at delivering strong current results and implementing multiple initiatives to drive long-term profitable growth,” said Tom Wilson, Chairman and Chief Executive Officer of The Allstate Corporation. “Policies in force reached 82.3 million, revenues grew 5% to $38.5 billion and net income was $3.07 billion due to strong performance from our market-facing businesses and investments. The Tax Cuts and Jobs Act resulted in a $506 million increase to net income and will provide future additional resources to accelerate the company’s strategies. Fourth quarter adjusted net income* was $762 million, excluding the impact of tax reform and goodwill impairment related to changes in reportable segments, as auto and homeowners insurance margins remained strong and

performance-based investments had outstanding results. Adjusted net income return on equity* was 13.3% for 2017 and book value per share increased by 13.4% for the year. Shareholders received cash returns of $1.9 billion in 2017, which was 6% of the average market capitalization, through a combination of dividends and share repurchases.”

“This operational strength will enable us to accelerate growth in 2018 while maintaining attractive returns. Allstate brand policies in force increased in the fourth quarter from the third quarter, reflecting a shift earlier in the year from improving auto insurance margins to growing profitably. We expect the underlying combined ratio* for the Property-Liability business to be between 86 and 88⁽¹⁾ for 2018, including additional growth investments as a result of the recent tax cuts. Investments in marketing, distribution, telematics, new products and technology are being accelerated. Allstate Benefits, SquareTrade and Esurance are also expected to contribute to growth in 2018. Reflecting this outlook and a reduction in the U.S. federal income tax rate, the quarterly dividend has been increased 24% to 46 cents per share for the first quarter of 2018.”

“The reduction in federal taxes also enables us to enhance the employee value proposition and improve local communities,” continued Wilson. “Employees will receive either $1,000 or $2,000 of ‘Choice Dollars’ in 2018, which can be taken as a cash bonus or contributed to a 401(k) or health savings account. This structure of employee choice will be incorporated into future benefit design. Allstate will also increase employee training in technology literacy to support sustainable employability. An additional $34 million was contributed to The Allstate Foundation in 2017 to expand existing programs and Allstate agency support for local causes. Allstate will remain focused on creating prosperity for all of our stakeholders,” concluded Wilson.

Operating Results: Fourth Quarter 2017


•	Total revenue of $9.8 billion in the fourth quarter of 2017 increased 6.1% compared to the prior year quarter.


◦	Property and casualty insurance premiums increased 3.8%.


◦	Life premiums and contract charges increased 4.7%.


◦	Net investment income increased 14.0%.


◦	Realized capital gains were $127 million compared to $2 million in the prior year quarter.

•

Net income applicable to common shareholders was $1.22 billion, or $3.35 per diluted share, in the fourth quarter of 2017, compared to $811 million, or $2.18 per diluted share, in the fourth quarter of 2016, primarily driven by the reduction to income tax expense following the passage of the Tax Cuts and Jobs Act. The creation of new segments for financial reporting led to goodwill impairment of $125 million related to goodwill that was reallocated to the new Allstate Annuities segment, as previously disclosed. Adjusted net income* was $762 million in the fourth quarter of 2017, compared to $807 million in the fourth quarter of 2016, as improved underlying performance and favorable prior year reserve reestimates were offset by higher catastrophe losses and expenses.


•	The 2017 full year underlying combined ratio* for the Property-Liability and Service Businesses of 85.6 was better than the annual outlook range of 87-89.


•	Property-Liability underwriting income of $715 million was $86 million below the prior year quarter, primarily due to higher catastrophe losses and increased compensation costs. These costs partially offset the positive impact of increased premiums earned, lower underlying loss costs and higher favorable prior year reserve reestimates.


◦	The underlying combined ratio* of 85.7 for the fourth quarter was 1.7 points lower than the prior year period, reflecting improvement in the auto insurance underlying combined ratio for all three underwritten brands.


◦	Non-catastrophe prior year reserve releases of $175 million in the fourth quarter of 2017 included Allstate brand releases of $169 million, primarily driven by Allstate brand auto injury coverages.

_________

⁽¹⁾ A reconciliation of this non-GAAP measure to the combined ratio, a GAAP measure, is not possible on a forward-looking basis because it is not possible to provide a reliable forecast of catastrophes, and 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.



Property-Liability Results
	Three months ended December 31,				Twelve months ended December 31,
(% to earned premiums)	2017	2016	pts Change		2017	2016	pts Change
Recorded Combined Ratio	91.0	89.7	1.3		93.6	96.0	(2.4	)
Allstate Brand Auto	91.9	95.3	(3.4	)	93.2	98.7	(5.5	)
Allstate Brand Homeowners	85.4	68.7	16.7		89.4	83.7	5.7
Allstate Brand Other Personal Lines	84.5	87.1	(2.6	)	93.1	89.6	3.5
Esurance	100.2	105.0	(4.8	)	103.3	107.5	(4.2	)
Encompass	106.4	90.0	16.4		103.0	99.9	3.1
Underlying Combined Ratio*	85.7	87.4	(1.7	)	84.9	87.6	(2.7	)
Allstate Brand Auto	94.2	96.2	(2.0	)	92.2	96.5	(4.3	)
Allstate Brand Homeowners	59.9	59.1	0.8		60.5	59.5	1.0
Allstate Brand Other Personal Lines	77.8	76.7	1.1		80.4	78.5	1.9
Esurance	99.8	105.0	(5.2	)	100.2	105.2	(5.0	)
Encompass	86.4	90.7	(4.3	)	86.5	90.3	(3.8	)


◦	Allstate brand auto net written premium grew 4.2% in the fourth quarter of 2017, reflecting a 4.5% increase in average premium compared to the prior year quarter, which was partially offset by a 0.8% decline in policies in force. Policies in force grew 0.3% compared to the third quarter of 2017 on continued improvement in the renewal ratio and new issued applications.


▪	The recorded combined ratio of 91.9 in the fourth quarter of 2017 was 3.4 points better than the prior year quarter due to a broad-based decline in accident frequency, increased premiums earned and higher favorable prior year reserve reestimates. The underlying combined ratio* in the current quarter was 2.0 points better than the prior year quarter.


◦	Allstate brand homeowners net written premium increased 3.4% in the fourth quarter of 2017 compared to the prior year quarter, reflecting an increase in average premium. Policies in force declined 0.5% compared to the prior year quarter, but grew 0.3% compared to the third quarter of 2017. The renewal ratio of 87.5 was unchanged and new issued applications grew.


▪	The recorded combined ratio of 85.4 in the fourth quarter of 2017 includes the impact of increased catastrophe losses, while the underlying combined ratio* of 59.9 continued to reflect strong underlying profitability.


◦	Allstate brand other personal lines net written premium of $410 million increased 4.3% in the fourth quarter of 2017 compared to the prior year quarter. The recorded combined ratio of 84.5 was 2.6 points better than the prior year quarter, primarily driven by lower catastrophe losses. The underlying combined ratio* was 77.8 in the fourth quarter of 2017.

◦

Esurance net written premium growth of 2.8% compared to the prior year quarter reflects increased average premium in auto and homeowners insurance, partially offset by a decline in auto policies in force. The strategy to drive higher growth across all lines of business continued to make progress as homeowners insurance policies in force increased 36.2%, with written premium of $79 million in 2017.


▪	The recorded combined ratio of 100.2 in the fourth quarter of 2017 improved 4.8 points compared to the prior year quarter, primarily driven by a lower expense ratio. The underlying combined ratio* of 99.8 was 5.2 points better than the prior year quarter, as both auto and homeowners insurance results improved.

◦

Encompass net written premium declined 7.6% in the fourth quarter of 2017 compared to the prior year quarter, reflecting the continued execution of profit improvement plans. The recorded combined ratio of 106.4 in the fourth quarter of 2017 was 16.4 points higher than the prior year quarter, due to catastrophe losses from California wildfires which was partially offset by lower underlying loss costs. The underlying combined ratio* of 86.4 for the fourth quarter was 4.3 points lower than the prior year quarter.

•

Service Businesses, a new reportable segment, offers a broad range of products and services that expand and enhance customer value propositions. Our strategy to deliver superior value propositions and build strategic platforms continued in the fourth quarter as policies in force grew to 43.5 million, an increase of 4.6 million compared to the third quarter of 2017, driven by growth in SquareTrade.


◦	Adjusted net loss of $24 million in the fourth quarter of 2017 was primarily due to investments in Arity’s research and development, a SquareTrade restructuring charge and the deployment of a new digital platform in Allstate Roadside Services.



Service Businesses Results
	Three months ended December 31,								Twelve months ended December 31,
($ in millions)	2017			2016			% Change		2017			2016			% Change
Total Revenues	$	264		$	181		45.9		$	993		$	698		42.3
SquareTrade	89			—			—		296			—			—
Allstate Roadside Services	72			81			(11.1	)	300			340			(11.8	)
Allstate Dealer Services	83			75			10.7		318			283			12.4
Arity	20			25			(20.0	)	79			75			5.3
Adjusted Net (Loss) / Income	(24		)	1			NM		(59		)	3			NM
SquareTrade	(11		)	—			—		(22		)	—			—
Allstate Roadside Services	(7		)	(5		)	40.0		(20		)	(12		)	66.7
Allstate Dealer Services	—			2			(100.0	)	(2		)	4			(150.0	)
Arity	(6		)	4			NM		(15		)	11			NM

NM = not meaningful


◦	SquareTrade revenue was $89 million in the fourth quarter, and policies in force grew to 38.7 million, an increase of 4.6 million policies compared to the third quarter of 2017. Adjusted net loss was $11 million in the fourth quarter of 2017.


◦	Allstate Roadside Services revenue in the fourth quarter of 2017 declined 11.1% compared to the prior year quarter, reflecting non-renewal of unprofitable third-party contracts. An adjusted net loss of $7 million was realized as the new digital platform, which reduces response time, is not yet profitable.


◦	Allstate Dealer Services revenue grew 10.7% compared to the fourth quarter of 2016 and adjusted net income broke even.


◦	Arity affiliate revenues were $20 million in the fourth quarter of 2017, generating an adjusted net loss of $6 million.

•

Allstate Life adjusted net income was $57 million in the fourth quarter of 2017, $9 million lower than the prior year quarter, primarily due to increased contract benefits and operating expenses partially offset by higher premiums. Premiums and contract charges increased 1.9% in the fourth quarter compared to the prior year quarter, primarily related to higher traditional life insurance renewal premiums and lower levels of reinsurance premiums ceded.


•	Allstate Benefits adjusted net income was $20 million in the fourth quarter of 2017, $3 million lower than the prior year quarter, primarily due to higher contract benefits and operating expenses, partially offset by higher premiums. Premiums and contract charges increased 8.3% in the fourth quarter compared to the prior year quarter, due to 7.4% growth in policies in force in 2017.


•	Allstate Annuities adjusted net income was $55 million in the fourth quarter of 2017, $14 million higher than the prior year quarter, primarily due to higher performance-based investment income. Policies in force declined 8.0% in 2017 as the business continues to run off.


•	Allstate Investments $83 billion portfolio generated net investment income of $913 million in the fourth quarter, which was 14.0% above the prior year quarter.



Allstate Investment Results
	Three months ended December 31,							Twelve months ended December 31,
($ in millions, except ratios)	2017			2016			% / pts Change	2017			2016			% / pts Change
Net investment income	$	913		$	801		14.0	$	3,401		$	3,042		11.8
Market-based investment income⁽¹⁾	664			654			1.5	2,656			2,598			2.2
Performance-based investment income⁽¹⁾	296			182			62.6	917			579			58.4
Realized capital gains and losses	127			2			NM	445			(90		)	NM
Change in unrealized net capital gains, pre-tax	(120		)	(1,245		)	NM	857			745			15.0
Total return on investment portfolio	1.1		%	(0.7		)%	1.8	5.9		%	4.4		%	1.5

⁽¹⁾Investment expenses are not allocated between market-based and performance-based portfolios with the exception of investee level expenses.

NM = not meaningful


◦	Market-based investments contributed stable earnings, primarily from fixed income securities. Market-based investment income of $664 million in the fourth quarter of 2017 increased over the prior year quarter, reflecting higher invested assets and stable portfolio yields.


◦	Performance-based investments generated income of $296 million in the fourth quarter of 2017, which increased 62.6% over the prior year quarter, reflecting asset appreciation, sales of underlying investments and the continued growth of the portfolio, across private equity and real estate.


◦	Net realized capital gains were $127 million in the fourth quarter of 2017, compared to gains of $2 million in the prior year quarter. Net realized gains on sales of $146 million were partially offset by impairments of $13 million and derivative losses of $6 million.


◦	Unrealized net capital gains decreased $120 million in the fourth quarter of 2017 as lower fixed income valuations offset positive equity markets.

◦

Total return on the investment portfolio included approximately 1% per quarter from investment income, as well as changes in the portfolio value between quarters. Total return was 1.1% for the fourth quarter, with positive equity returns offset by lower fixed income valuations. Beginning in 2018, equity valuation changes will be included in net income due to the adoption of new accounting standards.

Full Year 2017 Financial Highlights


•	Allstate delivered on all five 2017 Operating Priorities which focus on both near-term performance and long-term value creation.

◦

Better Serve Our Customers: The Net Promoter Score, which measures how likely customers are to recommend us, increased throughout 2017. Allstate brand auto insurance retention improved in the second half of 2017, and Esurance auto and homeowners insurance retention increased 2.1 points and 2.9 points, respectively, for the full year compared to 2016. If favorable trends in customer retention continue in 2018, this will support higher future growth.

◦

Achieve Target Economic Returns on Capital: The Property-Liability recorded combined ratio of 93.6 generated $2.0 billion in underwriting income for the year. Auto insurance underwriting income increased $1.1 billion in 2017 from the prior year, due to lower accident frequency, higher premiums and favorable prior year reserve reestimates of $490 million. Allstate brand homeowners insurance posted a combined ratio of 89.4, despite significant catastrophe events. The homeowners recorded combined ratio has been below 100 for six consecutive years, but underwriting income declined by $373 million versus the prior year partially offsetting gains in auto insurance. Net investment income increased 11.8% to $3.4 billion when combined with strong underwriting income, resulted in an adjusted net income return on shareholders’ equity* of 13.3%.


◦	Grow Customer Base: Consolidated policies in force grew to 82.3 million in 2017, with positive contributions from SquareTrade and Allstate Benefits. Allstate Protection policies in force declined due to the impact of profit improvement actions.

◦

Proactively Manage Investments: Total return on the $83 billion investment portfolio was 5.9% for 2017, reflecting equity and fixed income market appreciation and increased allocations to performance-based investments over the last five years. Net investment income of $3.4 billion was 11.8% higher than 2016, primarily due to strong asset appreciation and sales of underlying investments in the performance-based portfolio. The portfolio also benefited from higher market-based income, reflecting an increase in invested assets and stable portfolio yields.


◦	Build Long-Term Growth Platforms: Allstate Benefits continued its 17-year track record of growth, with policies in force increasing 7.4% in 2017. SquareTrade’s first-year performance was very strong, with growth in premium and policies in force accelerating each quarter throughout 2017. Arity signed its first third-party insurance customer to expand its platform outside of Allstate entities.

Tax Cuts and Jobs Act of 2017


•	Allstate anticipates an effective tax rate of 19%-20% in 2018.


•	Allstate will utilize the tax reform benefits to accelerate growth initiatives, further enhance our employee value proposition, improve local communities and raise shareholder returns by increasing the target quarterly dividend per common share.


•	Future insurance rate filings will be impacted by lower tax rates, but the targeted after-tax return on equity will not change. Tax reform affects only the profit provision component of the rate filings, and the impact will differ by state. As a result, this is not expected to have a material impact on Allstate’s near-term operating results or competitive position.


•	The passage of the Tax Cuts and Jobs Act resulted in a revaluation of deferred tax assets and liabilities, which primarily led to a $506 million reduction to income tax expense in the fourth quarter of 2017, or a $1.38 per share benefit to our earnings per diluted share in 2017.


◦	The tax benefit was driven by the reduction in our net deferred tax liability principally relating to deferred acquisition costs and unrealized investment gains.

Proactive Capital Management

“Allstate continued to proactively manage shareholders’ capital by returning $713 million during the fourth quarter through a combination of $134 million in common stock dividends and repurchasing $579 million of outstanding shares. For the full year we returned a total of $1.9 billion to shareholders. As of December 31, 2017, there was $1.27 billion remaining on the $2.0 billion common share repurchase program, which would represent 3.7% of shares outstanding at the current share price,” said Mario Rizzo, Chief Financial Officer. “In addition, the quarterly dividend per common share was increased 24% to 46 cents, payable in cash on April 2, 2018, to stockholders of record at the close of business on March 5, 2018.”

Visit www.allstateinvestors.com to view additional information about Allstate’s results, including a webcast of its quarterly conference call and the call presentation. The conference call will be held at 9 a.m. ET on Thursday, February 8.

The Allstate Corporation (NYSE: ALL) is the nation’s largest publicly held personal lines insurer, protecting people from life’s uncertainties with 82 million proprietary policies. Allstate offers a broad array of protection products through multiple brands and diverse distribution channels, including auto, home, life and other insurance offered through its Allstate, Esurance, Encompass and Answer Financial brands. The company provides additional protection products and services through Allstate Benefits, Allstate Roadside Services, Allstate Dealer Services, Arity and SquareTrade. Allstate is widely known from the slogan “You’re In Good Hands With Allstate^®.” Allstate agencies are in virtually every local community in America. The Allstate Foundation, Allstate, its employees and agency owners have a proud history of caring for local communities.

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. 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.



THE ALLSTATE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

($ in millions, except per share data)	Three months ended December 31,						Twelve months ended December 31,
	2017			2016			2017			2016
	(unaudited)						(unaudited)
Revenues
Property and casualty insurance premiums	$	8,202		$	7,901		$	32,300		$	31,307
Life premiums and contract charges	601			574			2,378			2,275
Net investment income	913			801			3,401			3,042
Realized capital gains and losses:
Total other-than-temporary impairment (“OTTI”) losses	(11		)	(72		)	(146		)	(313		)
OTTI losses reclassified to (from) other comprehensive income	(2		)	2			(4		)	10
Net OTTI losses recognized in earnings	(13		)	(70		)	(150		)	(303		)
Sales and other realized capital gains and losses	140			72			595			213
Total realized capital gains and losses	127			2			445			(90		)
	9,843			9,278			38,524			36,534

Costs and expenses
Property and casualty insurance claims and claims expense	5,279			5,083			21,929			22,221
Life contract benefits	507			464			1,923			1,857
Interest credited to contractholder funds	168			168			690			726
Amortization of deferred policy acquisition costs	1,239			1,157			4,784			4,550
Operating costs and expenses	1,257			1,063			4,658			4,106
Restructuring and related charges	32			9			109			30
Goodwill impairment	125			—			125			—
Interest expense	84			77			335			295
	8,691			8,021			34,553			33,785

Gain on disposition of operations	5			1			20			5

Income from operations before income tax expense	1,157			1,258			3,991			2,754

Income tax (benefit) expense	(92		)	418			802			877

Net income	1,249			840			3,189			1,877

Preferred stock dividends	29			29			116			116

Net income applicable to common shareholders	$	1,220		$	811		$	3,073		$	1,761

Earnings per common share:

Net income applicable to common shareholders per common share – Basic	$	3.41		$	2.20		$	8.49		$	4.72

Weighted average common shares – Basic	357.5			368.0			362.0			372.8

Net income applicable to common shareholders per common share – Diluted	$	3.35		$	2.18		$	8.36		$	4.67

Weighted average common shares – Diluted	363.8			372.5			367.8			377.3

Cash dividends declared per common share	$	0.37		$	0.33		$	1.48		$	1.32



THE ALLSTATE CORPORATION
BUSINESS RESULTS
($ in millions, except ratios)	Three months ended December 31,						Twelve months ended December 31,
	2017			2016			2017			2016
Property-Liability
Premiums written	$	7,838		$	7,565		$	31,648		$	30,891
Premiums earned	$	7,971		$	7,756		$	31,433		$	30,727
Claims and claims expense	(5,190		)	(5,024		)	(21,566		)	(21,968		)
Amortization of deferred policy acquisition costs	(1,091		)	(1,029		)	(4,205		)	(4,053		)
Operating costs and expenses	(957		)	(893		)	(3,559		)	(3,457		)
Restructuring and related charges	(18		)	(9		)	(91		)	(29		)
Underwriting income	715			801			2,012			1,220
Net investment income	415			334			1,478			1,253
Income tax expense on operations	(373		)	(385		)	(1,119		)	(812		)
Realized capital gains and losses, after-tax	73			10			272			—
Gain on disposition of operations, after-tax	2			—			9			—
Tax Legislation expense	(65		)	—			(65		)	—
Net income applicable to common shareholders	$	767		$	760		$	2,587		$	1,661
Catastrophe losses	$	598		$	302		$	3,228		$	2,571
Amortization of purchased intangible assets	$	2		$	5		$	7		$	32
Operating ratios:
Claims and claims expense ratio	65.1			64.8			68.6			71.5
Expense ratio	25.9			24.9			25.0			24.5
Combined ratio	91.0			89.7			93.6			96.0
Effect of catastrophe losses on combined ratio	7.5			3.9			10.3			8.4
Effect of prior year reserve reestimates on combined ratio	(2.3		)	(1.8		)	(1.6		)	(0.1		)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio	(0.1		)	(0.1		)	—			—
Effect of amortization of purchased intangible assets on combined ratio	—			0.1			—			0.1
Effect of Discontinued Lines and Coverages on combined ratio	—			0.1			0.3			0.3

Services Businesses
Premiums written	$	309		$	158		$	1,094		$	709
Premiums earned	231			145			867			580
Intersegment insurance premiums and service fees	28			32			110			105
Net investment income	5			4			16			13
Claims and claims expense	(90		)	(60		)	(369		)	(258		)
Amortization of deferred policy acquisition costs	(79		)	(57		)	(296		)	(214		)
Operating costs and expenses	(116		)	(65		)	(401		)	(223		)
Restructuring and related charges	(11		)	—			(13		)	—
Income tax benefit on operations	8			2			27			—
Adjusted net (loss) income	(24		)	1			(59		)	3
Amortization of purchased intangible assets, after-tax	(15		)	—			(60		)	—
Tax Legislation benefit	134			—			134			—
Net income applicable to common shareholders	$	95		$	1		$	15		$	3

Allstate Life
Premiums and contract charges	$	324		$	318		$	1,280		$	1,250
Net investment income	127			124			489			482
Contract benefits	(210		)	(188		)	(765		)	(742		)
Interest credited to contractholder funds	(71		)	(72		)	(282		)	(285		)
Amortization of deferred policy acquisition costs	(27		)	(32		)	(119		)	(125		)
Operating costs and expenses	(65		)	(56		)	(238		)	(225		)
Restructuring and related charges	(1		)	—			(2		)	(1		)
Income tax expense on operations	(20		)	(28		)	(110		)	(107		)
Adjusted net income	57			66			253			247
Realized capital gains and losses, after-tax	—			(7		)	2			(24		)
DAC and DSI amortization relating to realized capital gains and losses, after-tax	(2		)	(1		)	(10		)	(4		)
Tax Legislation benefit	332			—			332			—
Net income applicable to common shareholders	$	387		$	58		$	577		$	219



THE ALLSTATE CORPORATION
BUSINESS RESULTS
($ in millions, except ratios)	Three months ended December 31,						Twelve months ended December 31,
	2017			2016			2017			2016
Allstate Benefits
Premiums and contract charges	$	273		$	252		$	1,084		$	1,011
Net investment income	18			17			72			71
Contract benefits	(143		)	(129		)	(564		)	(509		)
Interest credited to contractholder funds	(9		)	(8		)	(35		)	(36		)
Amortization of deferred policy acquisition costs	(37		)	(36		)	(142		)	(145		)
Operating costs and expenses	(70		)	(62		)	(266		)	(240		)
Restructuring and related charges	(2		)	—			(3		)	—
Income tax expense on operations	(10		)	(11		)	(51		)	(52		)
Adjusted net income	20			23			95			100
Realized capital gains and losses, after-tax	(1		)	(1		)	—			(4		)
Tax Legislation benefit	51			—			51			—
Net income applicable to common shareholders	$	70		$	22		$	146		$	96

Allstate Annuities
Contract charges	$	4		$	4		$	14		$	14
Net investment income	338			312			1,305			1,181
Contract benefits	(154		)	(147		)	(594		)	(606		)
Interest credited to contractholder funds	(90		)	(97		)	(372		)	(402		)
Amortization of deferred policy acquisition costs	(2		)	(2		)	(7		)	(7		)
Operating costs and expenses	(9		)	(9		)	(35		)	(32		)
Income tax expense on operations	(32		)	(20		)	(107		)	(47		)
Adjusted net income	55			41			204			101
Realized capital gains and losses, after-tax	22			—			28			(26		)
Valuation changes on embedded derivatives not hedged, after-tax	2			6			—			(2		)
Gain on disposition of operations, after-tax	1			—			4			3
Tax Legislation benefit	182			—			182			—
Net income applicable to common shareholders	$	262		$	47		$	418		$	76

Corporate and Other
Net investment income	$	10		$	10		$	41		$	42
Operating costs and expenses	(128		)	(86		)	(488		)	(324		)
Income tax benefit on operations	43			29			164			106
Preferred stock dividends	(29		)	(29		)	(116		)	(116		)
Adjusted net loss	(104		)	(76		)	(399		)	(292		)
Realized capital gains and losses, after-tax	(4		)	(1		)	(4		)	(2		)
Business combination expenses, after-tax	—			—			(14		)	—
Goodwill impairment	(125		)	—			(125		)	—
Tax Legislation expense	(128		)	—			(128		)	—
Net loss applicable to common shareholders	$	(361	)	$	(77	)	$	(670	)	$	(294	)

Consolidated net income applicable to common shareholders	$	1,220		$	811		$	3,073		$	1,761



THE ALLSTATE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

($ in millions, except par value data)	December 31, 2017			December 31, 2016
Assets	(unaudited)
Investments:
Fixed income securities, at fair value (amortized cost $57,525 and $56,576)	$	58,992		$	57,839
Equity securities, at fair value (cost $5,461 and $5,157)	6,621			5,666
Mortgage loans	4,534			4,486
Limited partnership interests	6,740			5,814
Short-term, at fair value (amortized cost $1,944 and $4,288)	1,944			4,288
Other	3,972			3,706
Total investments	82,803			81,799
Cash	617			436
Premium installment receivables, net	5,786			5,597
Deferred policy acquisition costs	4,191			3,954
Reinsurance recoverables, net	8,921			8,745
Accrued investment income	569			567
Property and equipment, net	1,072			1,065
Goodwill	2,181			1,219
Other assets	2,838			1,835
Separate Accounts	3,444			3,393
Total assets	$	112,422		$	108,610
Liabilities
Reserve for property and casualty insurance claims and claims expense	$	26,325		$	25,250
Reserve for life-contingent contract benefits	12,549			12,239
Contractholder funds	19,434			20,260
Unearned premiums	13,473			12,583
Claim payments outstanding	875			879
Deferred income taxes	782			487
Other liabilities and accrued expenses	6,639			6,599
Long-term debt	6,350			6,347
Separate Accounts	3,444			3,393
Total liabilities	89,871			88,037
Shareholders’ equity
Preferred stock and additional capital paid-in, $1 par value, 72.2 thousand shares issued and outstanding, $1,805 aggregate liquidation preference	1,746			1,746
Common stock, $.01 par value, 900 million issued, 355 million and 366 million shares outstanding	9			9
Additional capital paid-in	3,313			3,303
Retained income ⁽¹⁾	43,211			40,678
Deferred ESOP expense	(3		)	(6		)
Treasury stock, at cost (545 million and 534 million shares)	(25,982		)	(24,741		)
Accumulated other comprehensive income:
Unrealized net capital gains and losses:
Unrealized net capital gains and losses on fixed income securities with OTTI	70			57
Other unrealized net capital gains and losses	1,634			1,091
Unrealized adjustment to DAC, DSI and insurance reserves	(332		)	(95		)
Unrealized net capital gains and losses ⁽¹⁾	1,372			1,053
Unrealized foreign currency translation adjustments ⁽¹⁾	(3		)	(50		)
Unrecognized pension and other postretirement benefit cost ⁽¹⁾	(1,112		)	(1,419		)
Total accumulated other comprehensive income (loss) ⁽¹⁾	257			(416		)
Total shareholders’ equity	22,551			20,573
Total liabilities and shareholders’ equity	$	112,422		$	108,610

⁽¹⁾In January 2018, the FASB issued a Proposed Accounting Standards Update titled “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” requiring reclassification of the impact of the newly enacted tax rates on the unrealized balances presented net of tax in accumulated other comprehensive income to retained income. We plan to early adopt the new guidance as of December 31, 2017, when finalized. The impact of the adoption will decrease retained income by $49 million, increase unrealized net capital gains and losses by $290 million, decrease unrealized foreign currency translation adjustments by $6 million and decrease unrecognized pension and other postretirement benefit cost by $235 million.



THE ALLSTATE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in millions)	Twelve months ended December 31,
	2017			2016
Cash flows from operating activities	(unaudited)
Net income	$	3,189		$	1,877
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and other non-cash items	483			382
Realized capital gains and losses	(445		)	90
Gain on disposition of operations	(20		)	(5		)
Interest credited to contractholder funds	690			726
Goodwill Impairment	125			—
Changes in:
Policy benefits and other insurance reserves	302			631
Unearned premiums	463			362
Deferred policy acquisition costs	(214		)	(165		)
Premium installment receivables, net	(131		)	(42		)
Reinsurance recoverables, net	(211		)	(264		)
Income taxes	(245		)	417
Other operating assets and liabilities	328			(16		)
Net cash provided by operating activities	4,314			3,993
Cash flows from investing activities
Proceeds from sales
Fixed income securities	25,341			25,061
Equity securities	6,504			5,546
Limited partnership interests	1,125			881
Other investments	274			262
Investment collections
Fixed income securities	4,194			4,533
Mortgage loans	600			501
Other investments	642			421
Investment purchases
Fixed income securities	(31,145		)	(27,990		)
Equity securities	(6,585		)	(5,950		)
Limited partnership interests	(1,440		)	(1,450		)
Mortgage loans	(646		)	(646		)
Other investments	(999		)	(885		)
Change in short-term investments, net	2,610			(2,446		)
Change in other investments, net	(30		)	(51		)
Purchases of property and equipment, net	(299		)	(313		)
Acquisition of operations	(1,356		)	—
Net cash used in investing activities	(1,210		)	(2,526		)
Cash flows from financing activities
Proceeds from issuance of long-term debt	—			1,236
Repayments of long-term debt	—			(17		)
Contractholder fund deposits	1,025			1,049
Contractholder fund withdrawals	(1,890		)	(2,087		)
Dividends paid on common stock	(525		)	(486		)
Dividends paid on preferred stock	(116		)	(116		)
Treasury stock purchases	(1,495		)	(1,337		)
Shares reissued under equity incentive plans, net	135			164
Excess tax benefits on share-based payment arrangements	—			32
Other	(57		)	36
Net cash used in financing activities	(2,923		)	(1,526		)
Net increase (decrease) in cash	181			(59		)
Cash at beginning of year	436			495
Cash at end of year	$	617		$	436

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.

Adjusted net income is net income applicable 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 adjusted net income,


•	valuation changes on embedded derivatives 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 not hedged, after-tax,


•	business combination expenses and the 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 applicable to common shareholders is the GAAP measure that is most directly comparable to adjusted net income.

We use adjusted net 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 not hedged, business combination expenses and the 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 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, adjusted net 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 adjusted net 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. Business combination expenses are excluded because they are non-recurring in nature and the 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, adjusted net 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 adjusted net 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. Adjusted net income is used by management along with the other components of net income applicable to common shareholders to assess our performance. We use adjusted measures of adjusted net income in incentive compensation. Therefore, we believe it is useful for investors to evaluate net income applicable to common shareholders, adjusted net 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 adjusted net 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 adjusted net income as the denominator. Adjusted net income should not be considered a substitute for net income applicable to common shareholders and does not reflect the overall profitability of our business.

The following tables reconcile net income applicable to common shareholders and adjusted net income. Taxes on adjustments to reconcile net income applicable to common shareholders and adjusted net income generally use a 35% effective tax rate and are reported net with the reconciling adjustment, except for goodwill impairment that has no tax benefit and Tax Legislation expense (benefit) that is all tax.



($ in millions, except per share data)	Three months ended December 31,
	Property-Liability						Consolidated						Per diluted common share
	2017			2016			2017			2016			2017			2016
Net income applicable to common shareholders	$	767		$	760		$	1,220		$	811		$	3.35		$	2.18
Realized capital gains and losses, after-tax	(73		)	(10		)	(90		)	(1		)	(0.25		)	—
Valuation changes on embedded derivatives not hedged, after-tax	—			—			(2		)	(6		)	(0.01		)	(0.02		)
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax	—			—			2			1			0.01			—
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax	(1		)	(2		)	(1		)	(2		)	—			—
Business combination expenses and the amortization of purchased intangible assets, after-tax	2			4			17			4			0.05			0.01
Gain on disposition of operations, after-tax	(2		)	—			(3		)	—			(0.01		)	—
Goodwill impairment	—			—			125			—			0.34			—
Tax Legislation expense (benefit)	65			—			(506		)	—			(1.39		)	—
Adjusted net income*	$	758		$	752		$	762		$	807		$	2.09		$	2.17

	Twelve months ended December 31,
	Property-Liability						Consolidated						Per diluted common share
	2017			2016			2017			2016			2017			2016
Net income applicable to common shareholders	$	2,587		$	1,661		$	3,073		$	1,761		$	8.36		$	4.67
Realized capital gains and losses, after-tax	(272		)	—			(298		)	56			(0.81		)	0.15
Valuation changes on embedded derivatives not hedged, after-tax	—			—			—			2			—			—
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax	—			—			10			4			0.03			0.01
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax	(3		)	(3		)	(3		)	(3		)	(0.01		)	(0.01		)
Business combination expenses and the amortization of purchased intangible assets, after-tax	5			21			79			21			0.22			0.06
Gain on disposition of operations, after-tax	(9		)	—			(13		)	(3		)	(0.04		)	(0.01		)
Goodwill impairment	—			—			125			—			0.34			—
Tax Legislation expense (benefit)	65			—			(506		)	—			(1.38		)	—
Adjusted net income*	$	2,373		$	1,679		$	2,467		$	1,838		$	6.71		$	4.87

Adjusted net income return on common shareholders’ equity is a ratio that uses a non-GAAP measure. It is calculated by dividing the rolling 12-month adjusted net 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 adjusted net income as the numerator for the same reasons we use adjusted net 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 applicable 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 adjusted net 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 adjusted net income return on common shareholders’ equity in incentive compensation. Therefore, we believe it is useful for investors to have adjusted net 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 adjusted net 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. Adjusted net 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.

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



($ in millions)	For the twelve months ended December 31,
	2017			2016
Return on common shareholders’ equity
Numerator:
Net income applicable to common shareholders	$	3,073		$	1,761
Denominator:
Beginning common shareholders’ equity ⁽¹⁾	$	18,827		$	18,279
Ending common shareholders’ equity ⁽¹⁾	20,805			18,827
Average common shareholders’ equity	$	19,816		$	18,553
Return on common shareholders’ equity ⁽²⁾	15.5		%	9.5		%



($ in millions)	For the twelve months ended December 31,
	2017			2016
Adjusted net income return on common shareholders’ equity
Numerator:
Adjusted net income	$	2,467		$	1,838

Denominator:
Beginning common shareholders’ equity	$	18,827		$	18,279
Less: Unrealized net capital gains and losses	1,053			620
Adjusted beginning common shareholders’ equity	17,774			17,659

Ending common shareholders’ equity	20,805			18,827
Less: Unrealized net capital gains and losses	1,372			1,053
Adjusted ending common shareholders’ equity	19,433			17,774
Average adjusted common shareholders’ equity	$	18,604		$	17,717
Adjusted net income return on common shareholders’ equity *⁽²⁾⁽³⁾	13.3		%	10.4		%

_____________

⁽¹⁾ Excludes equity related to preferred stock of $1,746 million.

⁽²⁾ The Tax Legislation adjustment recorded in fourth quarter 2017 increased return on equity by 2.4 points and decreased adjusted net income return on equity by 0.1 points.

⁽³⁾ In January 2018,the FASB issued a Proposed Accounting Standards Update titled “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” requiring reclassification of the impact of the newly enacted tax rates on the unrealized balances presented net of tax in accumulated other comprehensive income to retained income. We plan to early adopt the new guidance as of December 31, 2017, when finalized. The impact of the adoption will increase the adjusted net income return on equity calculation by 0.1 points.

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 tables reconcile the respective combined ratio to the underlying combined ratio.



Property-Liability	Three months ended December 31,				Twelve months ended December 31,
	2017		2016		2017		2016
Combined ratio	91.0		89.7		93.6		96.0
Effect of catastrophe losses	(7.5	)	(3.9	)	(10.3	)	(8.4	)
Effect of prior year non-catastrophe reserve reestimates	2.2		1.7		1.6		0.1
Effect of amortization of purchased intangible assets	—		(0.1	)	—		(0.1	)
Underlying combined ratio*	85.7		87.4		84.9		87.6

Effect of prior year catastrophe reserve reestimates	(0.1	)	(0.1	)	—		—

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



Property-Liability as historically reported ⁽¹⁾	Three months ended December 31,				Twelve months ended December 31,
	2017		2016		2017		2016
Combined ratio	92.0		89.9		94.4		96.1
Effect of catastrophe losses	(7.3	)	(3.8	)	(10.0	)	(8.2	)
Effect of prior year non-catastrophe reserve reestimates	2.1		1.6		1.5		0.1
Effect of amortization of purchased intangible assets	(0.3	)	—		(0.3	)	(0.1	)
Underlying combined ratio*	86.5		87.7		85.6		87.9

Effect of prior year catastrophe reserve reestimates	(0.1	)	(0.1	)	(0.1	)	—


⁽¹⁾	Property-Liability, as historically reported, includes Allstate Protection, Services Businesses and Discontinued Lines and Coverages segment results.



Allstate brand - Total	Three months ended December 31,				Twelve months ended December 31,
	2017		2016		2017		2016
Combined ratio	89.9		88.7		92.3		94.8
Effect of catastrophe losses	(7.4	)	(4.1	)	(10.4	)	(8.7	)
Effect of prior year non-catastrophe reserve reestimates	2.3		1.6		2.0		0.4
Underlying combined ratio*	84.8		86.2		83.9		86.5

Effect of prior year catastrophe reserve reestimates	(0.1	)	(0.1	)	—		—



Allstate brand - Auto Insurance	Three months ended December 31,				Twelve months ended December 31,
	2017		2016		2017		2016
Combined ratio	91.9		95.3		93.2		98.7
Effect of catastrophe losses	(0.7	)	(1.2	)	(3.4	)	(2.8	)
Effect of prior year non-catastrophe reserve reestimates	3.0		2.1		2.4		0.6
Underlying combined ratio*	94.2		96.2		92.2		96.5

Effect of prior year catastrophe reserve reestimates	—		—		(0.1	)	(0.1	)



Allstate brand - Homeowners Insurance	Three months ended December 31,				Twelve months ended December 31,
	2017		2016		2017		2016
Combined ratio	85.4		68.7		89.4		83.7
Effect of catastrophe losses	(27.8	)	(10.8	)	(30.7	)	(24.6	)
Effect of prior year non-catastrophe reserve reestimates	2.3		1.2		1.8		0.4
Underlying combined ratio*	59.9		59.1		60.5		59.5

Effect of prior year catastrophe reserve reestimates	(0.3	)	(0.5	)	(0.1	)	0.1



Allstate brand - Other Personal Lines	Three months ended December 31,				Twelve months ended December 31,
	2017		2016		2017		2016
Combined ratio	84.5		87.1		93.1		89.6
Effect of catastrophe losses	(4.8	)	(9.7	)	(12.2	)	(11.8	)
Effect of prior year non-catastrophe reserve reestimates	(1.9	)	(0.7	)	(0.5	)	0.7
Underlying combined ratio*	77.8		76.7		80.4		78.5

Effect of prior year catastrophe reserve reestimates	(0.5	)	(0.2	)	0.2		(0.2	)



Esurance brand - Total	Three months ended December 31,				Twelve months ended December 31,
	2017		2016		2017		2016
Combined ratio	100.2		105.0		103.3		107.5
Effect of catastrophe losses	(0.2	)	(1.2	)	(2.9	)	(2.2	)
Effect of prior year non-catastrophe reserve reestimates	—		2.1		—		1.3
Effect of amortization of purchased intangible assets	(0.2	)	(0.9	)	(0.2	)	(1.4	)
Underlying combined ratio*	99.8		105.0		100.2		105.2

Effect of prior year catastrophe reserve reestimates	—		—		(0.1	)	—



Encompass brand - Total	Three months ended December 31,				Twelve months ended December 31,
	2017		2016		2017		2016
Combined ratio	106.4		90.0		103.0		99.9
Effect of catastrophe losses	(23.4	)	(3.1	)	(17.7	)	(9.2	)
Effect of prior year non-catastrophe reserve reestimates	3.4		3.8		1.2		(0.4	)
Underlying combined ratio*	86.4		90.7		86.5		90.3

Effect of prior year catastrophe reserve reestimates	(0.4	)	—		(0.1	)	—

# # # # #

allcorp123117investorsup

EXHIBIT 99.2 Measures used in these financial statements and exhibits that are not based on generally accepted accounting principles ("non-GAAP") are denoted with an asterisk (*). 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 2017 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.

Exec - 1 THE ALLSTATE CORPORATION Investor Supplement - Fourth Quarter 2017 Updated to Reflect Changes in Reportable Segments Beginning in the fourth quarter of 2017, Allstate will be reporting its financial performance in the following segments: Allstate Protection, Discontinued Lines and Coverages, Service Businesses, Allstate Life, Allstate Benefits, Allstate Annuities, and Corporate and Other. These segments align with the Company’s key product and service offerings, including the acquisition of SquareTrade and the strategic focus and expansion of Arity and other service businesses. We have updated all periods presented in our Fourth Quarter 2017 Investor Supplement to be consistent with our new reportable segments.

Exec - 2 THE ALLSTATE CORPORATION Investor Supplement - Fourth Quarter 2017 Reportable Segments Products and Strategies

Exec - 3 THE ALLSTATE CORPORATION Investor Supplement - Fourth Quarter 2017 Reportable Segments Products and Strategies (continued)

Exec - 4 THE ALLSTATE CORPORATION Investor Supplement - Fourth Quarter 2017 Reportable Segments Products and Strategies (continued)

Exec - 5 (1) (2) (3) Allstate Protection and Discontinued Lines and Coverages segments comprise Property-Liability. The Company does not allocate investment income, realized capital gains and losses, or investment assets to the Allstate Protection and Discontinued Lines and Coverages segments. THE ALLSTATE CORPORATION Investor Supplement - Fourth Quarter 2017 Revenue by Reportable Segments The Discontinued Lines and Coverages and Corporate and Other segments do not have recurring premiums or contract charges. Excludes $110 million of intersegment premiums and service fees, which are eliminated in the consolidated financial statements. Premiums $32,300 Premiums and Contract Charges $2,378 Total Premiums Earned and Contract Charges $34,678 (1) Allstate Protection $31,433 Service Businesses $867 (2) Allstate Life $1,280 Allstate Benefits $1,084 Allstate Annuities $14 $ in millions, for the year ended December 31, 2017 Net Investment Income $3,401 Realized Capital Gains and Losses $445 Total Net Investment Income and Realized Capital Gains and Losses $3,846 $ in millions, for the year ended December 31, 2017 Property-Liability $1,478 (3) Service Businesses $16 Allstate Life $489 Allstate Benefits $72 Allstate Annuities $1,305 Corporate and Other $41 Property-Liability $401 (3) Service Businesses $0 Allstate Life $5 Allstate Benefits $1 Allstate Annuities $44 Corporate and Other $(6)

Exec - 6 Property-Liability As Historically Reported Property-Liability Change (2) Premiums earned $ 32,300 $ 31,433 $ (867) Incurred losses (21,929) (21,566) 363 Expenses (8,553) (7,855) 698 Underwriting income $ 1,818 $ 2,012 $ 194 Catastrophe losses $ 3,234 $ 3,228 $ (6) Non-catastrophe prior year reserve reestimates (485) (487) (2) Amortization of purchased intangible assets 99 7 (92) Combined Ratio 94.4 93.6 (0.8) Effect of catastrophe losses on combined ratio (10.0) (10.3) (0.3) Effect of prior year non-catastrophe prior year reserve reestimates 1.5 1.6 0.1 Effect of amortization of purchased intangible assets on combined ratio (0.3) - 0.3 Underlying combined ratio * 85.6 84.9 (0.7) (1) Allstate Protection and Discontinued Lines and Coverages segments comprise Property-Liability. (2) Excludes intersegment insurance premiums and services fees of $110 mllion and the related incurred losses of $6 million and expenses of $104 million. THE ALLSTATE CORPORATION CHANGES IN REPORTABLE SEGMENTS AND COMBINED RATIO CALCULATION Property-Liability(1) Combined Ratio and Underlying Combined Ratio* Property-Liability includes Allstate Protection and Discontinued Lines and Coverages segment results. Property-Liability, as historically reported, included Allstate Protection, Service Businesses and Discontinued Lines and Coverages segment results. The change column represents the impact of the Service Businesses segment, which includes SquareTrade, Arity, Allstate Roadside Services and Allstate Dealer Services and is no longer included in Allstate Protection. For the twelve months ended December 31, 2017

Table of Contents Consolidated Operations Allstate Life Operations Statements of Operations 1 Segment Results and Other Statistics 40 Contribution to Income 2 Analysis of Net Income 41 Revenues 3 Return on Equity 42 Segment Results 4,5 Reserves and Contractholder Funds 43 Historical Segment Results 6 Condensed Statements of Financial Position 7 Allstate Benefits Operations Book Value Per Common Share 8 Segment Results and Other Statistics 44 Return on Common Shareholders' Equity 9 Segment Premium and Other Statistics 45 Debt to Capital 10 Return on Equity 46 Statements of Cash Flows 11 Analysis of Deferred Policy Acquisition Costs 12,13 Allstate Annuities Operations Historical Summary of Consolidated Operating and Financial Position Data 14 Segment Results and Other Statistics 47 Policies in Force 15 Analysis of Net Income 48 Premiums Written For Allstate Protection and Service Businesses 16 Return on Equity 49 Catastrophe Losses 17 Reserves and Contractholder Funds 50 Prior Year Reserve Reestimates 18 Historical Prior Year Reserve Reestimates 19 Historical Loss Reserves 20 Property-Liability Operations Corporate and Other Segment Results 51 Results 21 Historical Results 22 Investments Underwriting Results by Area of Business 23 Consolidated Investments 52 Catastrophe Experience 24 Investments by Segment 53 Allstate Protection Unrealized Net Capital Gains and Losses on Security Portfolio by Type 54 Impact of Net Rate Changes Approved on Premiums Written 25 Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-tax) 55 Allstate Brand Profitability Measures 26 Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-tax) by Segment 56 Allstate Brand Statistics 27 Consolidated Investment Position and Results by Strategy 57 Allstate Brand Auto Claim Frequency Analysis 28,29 Investment Position and Results by Strategy by Segment 58 Esurance Brand Profitability Measures and Statistics 30 Performance-Based Investments 59 Encompass Brand Profitability Measures and Statistics 31 Limited Partnership Interests 60 Historical Underwriting Results by Area of Business 32 Auto Profitability Measures 33 Definitions of Non-GAAP Measures 61,62 Homeowners Profitability Measures 34 Other Personal Lines Profitability Measures 35 Commercial Lines Profitability Measures 36 Discontinued Lines and Coverages Reserves 37 Service Businesses Operations Segment Results 38 SquareTrade Results 39 THE ALLSTATE CORPORATION Investor Supplement - Fourth Quarter 2017

1 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Revenues Property and casualty insurance premiums (1) $ 8,202 $ 8,121 $ 8,018 $ 7,959 $ 7,901 $ 7,869 $ 7,814 $ 7,723 $ 32,300 $ 31,307 Life premiums and contract charges (2) 601 593 591 593 574 571 564 566 2,378 2,275 Net investment income 913 843 897 748 801 748 762 731 3,401 3,042 Realized capital gains and losses: Total other-than-temporary impairment ("OTTI") losses (11) (26) (47) (62) (72) (73) (77) (91) (146) (313) OTTI losses reclassified to (from) other comprehensive income (2) (2) (3) 3 2 - (2) 10 (4) 10 Net OTTI losses recognized in earnings (13) (28) (50) (59) (70) (73) (79) (81) (150) (303) Sales and other realized capital gains and losses 140 131 131 193 72 106 103 (68) 595 213 Total realized capital gains and losses 127 103 81 134 2 33 24 (149) 445 (90) Total revenues 9,843 9,660 9,587 9,434 9,278 9,221 9,164 8,871 38,524 36,534 Costs and expenses Property and casualty insurance claims and claims expense 5,279 5,545 5,689 5,416 5,083 5,553 5,901 5,684 21,929 22,221 Life contract benefits 507 456 486 474 464 484 454 455 1,923 1,857 Interest credited to contractholder funds 168 174 175 173 168 183 185 190 690 726 Amortization of deferred policy acquisition costs 1,239 1,200 1,176 1,169 1,157 1,138 1,126 1,129 4,784 4,550 Operating costs and expenses 1,257 1,218 1,086 1,097 1,063 1,021 1,040 982 4,658 4,106 Restructuring and related charges 32 14 53 10 9 5 11 5 109 30 Goodwill impairment 125 - - - - - - - 125 - Interest expense 84 83 83 85 77 73 72 73 335 295 Total costs and expenses 8,691 8,690 8,748 8,424 8,021 8,457 8,789 8,518 34,553 33,785 Gain on disposition of operations 5 1 12 2 1 1 1 2 20 5 Income from operations before income tax expense 1,157 971 851 1,012 1,258 765 376 355 3,991 2,754 Income tax (benefit) expense (92) (4) 305 272 317 418 245 105 109 802 (4) 877 Net income $ 1,249 $ 666 $ 579 $ 695 $ 840 $ 520 $ 271 $ 246 $ 3,189 $ 1,877 Preferred stock dividends 29 29 29 29 29 29 29 29 116 116 Net income applicable to common shareholders $ 1,220 $ 637 $ 550 $ 666 $ 811 $ 491 $ 242 $ 217 $ 3,073 $ 1,761 Earnings per common share: (3) Net income applicable to common shareholders per common share - Basic $ 3.41 $ 1.76 $ 1.51 $ 1.82 $ 2.20 $ 1.32 $ 0.65 $ 0.57 $ 8.49 $ 4.72 Weighted average common shares - Basic 357.5 361.3 363.6 365.7 368.0 371.5 373.6 378.1 362.0 372.8 Net income applicable to common shareholders per common share - Diluted $ 3.35 $ 1.74 $ 1.49 $ 1.79 $ 2.18 $ 1.31 $ 0.64 $ 0.57 $ 8.36 $ 4.67 Weighted average common shares - Diluted 363.8 367.1 369.0 371.3 372.5 375.9 378.1 382.9 367.8 377.3 Cash dividends declared per common share $ 0.37 $ 0.37 $ 0.37 $ 0.37 $ 0.33 $ 0.33 $ 0.33 $ 0.33 $ 1.48 $ 1.32 (1) (2) (3) (4) Includes a $506 million benefit related to Tax Legislation. Life premiums and contract charges are reported in the Allstate Life, Allstate Benefits and Allstate Annuities results and include life insurance, voluntary accident and health insurance, and annuity products. In accordance with GAAP, the quarter and year-to-date per share amounts are calculated discretely. Therefore, the sum of each quarter may not equal the year-to-date amount. THE ALLSTATE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS ($ in millions, except per share data) Three months ended Twelve months ended Property and casualty insurance premiums are reported in the Property-Liability and Service Businesses results and include auto, homeowners and other personal lines insurance products, as well as consumer product protection plans, roadside assistance, and finance and insurance products.

2 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Contribution to income Net income applicable to common shareholders $ 1,220 $ 637 $ 550 $ 666 $ 811 $ 491 $ 242 $ 217 $ 3,073 $ 1,761 Realized capital gains and losses, after-tax (90) (67) (53) (88) (1) (22) (17) 96 (298) 56 Valuation changes on embedded derivatives not hedged, after-tax (2) 1 1 - (6) - 4 4 - 2 DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax 2 2 3 3 1 1 1 1 10 4 Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax (1) (1) (1) - (2) - - (1) (3) (3) Business combination expenses and the amortization of purchased intangible assets, after-tax 17 17 16 29 4 5 6 6 79 21 Gain on disposition of operations, after-tax (3) (2) (6) (2) - (1) (1) (1) (13) (3) Goodwill impairment 125 - - - - - - - 125 - Tax Legislation benefit (506) - - - - - - - (506) - Adjusted net income * $ 762 $ 587 $ 510 $ 608 $ 807 $ 474 $ 235 $ 322 $ 2,467 $ 1,838 Income per common share - Diluted Net income applicable to common shareholders $ 3.35 $ 1.74 $ 1.49 $ 1.79 $ 2.18 $ 1.31 $ 0.64 $ 0.57 $ 8.36 $ 4.67 Realized capital gains and losses, after-tax (0.25) (0.18) (0.14) (0.24) - (0.06) (0.04) 0.25 (0.81) 0.15 Valuation changes on embedded derivatives not hedged, after-tax (0.01) - - - (0.02) - 0.01 0.01 - - DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax 0.01 0.01 0.01 0.01 - - - - 0.03 0.01 Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax - - - - - - - - (0.01) (0.01) Business combination expenses and the amortization of purchased intangible assets, after-tax 0.05 0.04 0.04 0.08 0.01 0.01 0.01 0.01 0.22 0.06 Gain on disposition of operations, after-tax (0.01) (0.01) (0.02) - - - - - (0.04) (0.01) Goodwill impairment 0.34 - - - - - - - 0.34 - Tax Legislation benefit (1.39) - - - - - - - (1.38) - Adjusted net income * $ 2.09 $ 1.60 $ 1.38 $ 1.64 $ 2.17 $ 1.26 $ 0.62 $ 0.84 $ 6.71 $ 4.87 Weighted average common shares - Diluted 363.8 367.1 369.0 371.3 372.5 375.9 378.1 382.9 367.8 377.3 THE ALLSTATE CORPORATION CONTRIBUTION TO INCOME ($ in millions, except per share data) Three months ended Twelve months ended

3 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Property-Liability (1) Insurance premiums $ 7,971 $ 7,896 $ 7,807 $ 7,759 $ 7,756 $ 7,719 $ 7,672 $ 7,580 $ 31,433 $ 30,727 Net investment income 415 368 387 308 334 307 313 299 1,478 1,253 Realized capital gains and losses 99 82 85 135 14 53 26 (99) 401 (6) Total Property-Liability revenues 8,485 8,346 8,279 8,202 8,104 8,079 8,011 7,780 33,312 31,974 Service Businesses Insurance premiums 231 225 211 200 145 150 142 143 867 580 Intersegment insurance premiums and service fees (2) 28 26 28 28 32 33 33 7 110 105 Net investment income 5 4 4 3 4 3 3 3 16 13 Realized capital gains and losses - - - - - - - - - - Total Service Businesses revenues 264 255 243 231 181 186 178 153 993 698 Allstate Life Premiums and contract charges 324 316 319 321 318 310 310 312 1,280 1,250 Net investment income 127 119 123 120 124 120 118 120 489 482 Realized capital gains and losses 1 2 1 1 (13) (10) (3) (12) 5 (38) Total Allstate Life revenues 452 437 443 442 429 420 425 420 1,774 1,694 Allstate Benefits Premiums and contract charges 273 273 269 269 252 257 251 251 1,084 1,011 Net investment income 18 18 19 17 17 18 18 18 72 71 Realized capital gains and losses - 1 - - 1 (1) - (5) 1 (5) Total Allstate Benefits revenues 291 292 288 286 270 274 269 264 1,157 1,077 Allstate Annuities Contract charges 4 4 3 3 4 4 3 3 14 14 Net investment income 338 324 354 289 312 289 299 281 1,305 1,181 Realized capital gains and losses 33 18 (5) (2) 1 (10) 3 (32) 44 (38) Total Allstate Annuities revenues 375 346 352 290 317 283 305 252 1,363 1,157 Corporate and Other Net investment income 10 10 10 11 10 11 11 10 41 42 Realized capital gains and losses (6) - - - (1) 1 (2) (1) (6) (3) Total Corporate and Other revenues 4 10 10 11 9 12 9 9 35 39 Intersegment eliminations (2) (28) (26) (28) (28) (32) (33) (33) (7) (110) (105) Consolidated revenues $ 9,843 $ 9,660 $ 9,587 $ 9,434 $ 9,278 $ 9,221 $ 9,164 $ 8,871 $ 38,524 $ 36,534 (1) (2) Allstate Protection and Discontinued Lines and Coverages segments comprise Property-Liability. THE ALLSTATE CORPORATION REVENUES ($ in millions) Twelve months endedThree months ended Intersegment insurance premiums and service fees are primarily related to Allstate Roadside Services and Arity and are eliminated in the consolidated financial statements.

4 Discontinued Total Allstate Lines and Property- Service Allstate Allstate Allstate Corporate Intersegment Three months ended December 31, 2017 Protection Coverages Liability Businesses Life Benefits Annuities and Other Eliminations Consolidated Premiums and contract charges $ 7,971 $ - $ 7,971 $ 231 $ 324 $ 273 $ 4 $ - $ - $ 8,803 Intersegment insurance premiums and service fees - - - 28 - - - - (28) - Claims and claims expense (5,187) (3) (5,190) (90) - - - - 1 (5,279) Contract benefits and interest credited to contractholder funds - - - - (281) (152) (242) - - (675) Amortization of deferred policy acquisition costs (1,091) - (1,091) (79) (30) (37) (2) - - (1,239) Operating costs and expenses (956) (1) (957) (139) (65) (70) (9) (44) 27 (1,257) Restructuring and related charges (18) - (18) (11) (1) (2) - - - (32) Goodwill impairment - - - - - - - (125) - (125) Interest expense - - - - - - - (84) - (84) Underwriting income (loss) $ 719 $ (4) 715 Net investment income 415 5 127 18 338 10 - 913 Realized capital gains and losses 99 - 1 - 33 (6) - 127 Gain on disposition of operations 4 - - - 1 - - 5 Income tax (expense) benefit (466) 150 312 40 139 (83) - 92 Preferred stock dividends - - - - - (29) - (29) Net income (loss) applicable to common shareholders $ 767 $ 95 $ 387 $ 70 $ 262 $ (361) $ - $ 1,220 Realized capital gains and losses, after-tax (73) - - 1 (22) 4 - (90) Valuation changes on embedded derivatives not hedged, after-tax - - - - (2) - - (2) DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax - - 2 - - - - 2 Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax (1) - - - - - - (1) Business combination expenses and the amortization of purchased intangible assets, after-tax 2 15 - - - - - 17 Gain on disposition of operations, after-tax (2) - - - (1) - - (3) Goodwill impairment - - - - - 125 - 125 Tax Legislation expense (benefit) 65 (134) (332) (51) (182) 128 - (506) Adjusted net income (loss) * $ 758 $ (24) (1) $ 57 (1) $ 20 (1) $ 55 (1) $ (104) (1) $ - $ 762 Discontinued Total Allstate Lines and Property- Service Allstate Allstate Allstate Corporate Intersegment Three months ended December 31, 2016 Protection Coverages Liability Businesses Life Benefits Annuities and Other Eliminations Consolidated Premiums and contract charges $ 7,756 $ - $ 7,756 $ 145 $ 318 $ 252 $ 4 $ - $ - $ 8,475 Intersegment insurance premiums and service fees - - - 32 - - - - (32) - Claims and claims expense (5,021) (3) (5,024) (60) - - - - 1 (5,083) Contract benefits and interest credited to contractholder funds - - - - (260) (137) (235) - - (632) Amortization of deferred policy acquisition costs (1,029) - (1,029) (57) (33) (36) (2) - - (1,157) Operating costs and expenses (893) - (893) (65) (56) (62) (9) (9) 31 (1,063) Restructuring and related charges (9) - (9) - - - - - - (9) Interest expense - - - - - - - (77) - (77) Underwriting income (loss) $ 804 $ (3) 801 - - - - - - Net investment income 334 4 124 17 312 10 - 801 Realized capital gains and losses 14 - (13) 1 1 (1) - 2 Gain on disposition of operations - - - - 1 - - 1 Income tax (expense) benefit (389) 2 (22) (13) (25) 29 - (418) Preferred stock dividends - - - - - (29) - (29) Net income (loss) applicable to common shareholders $ 760 $ 1 $ 58 $ 22 $ 47 $ (77) $ - $ 811 Realized capital gains and losses, after-tax (10) - 7 1 - 1 - (1) Valuation changes on embedded derivatives not hedged, after-tax - - - - (6) - - (6) DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax - - 1 - - - - 1 Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax (2) - - - - - - (2) Business combination expenses and the amortization of purchased intangible assets, after-tax 4 - - - - - - 4 Gain on disposition of operations, after-tax - - - - - - - - Adjusted net income (loss) * $ 752 $ 1 (1) $ 66 (1) $ 23 (1) $ 41 (1) $ (76) (1) $ - $ 807 (1) THE ALLSTATE CORPORATION CONSOLIDATING SEGMENT RESULTS ($ in millions) Adjusted net income is the segment measure used for each business.

5 Discontinued Total Allstate Lines and Property- Service Allstate Allstate Allstate Corporate Intersegment Twelve months ended December 31, 2017 Protection Coverages Liability Businesses Life Benefits Annuities and Other Eliminations Consolidated Premiums and contract charges $ 31,433 $ - $ 31,433 $ 867 $ 1,280 $ 1,084 $ 14 $ - $ - $ 34,678 Intersegment insurance premiums and service fees - - - 110 - - - - (110) - Claims and claims expense (21,470) (96) (21,566) (369) - - - - 6 (21,929) Contract benefits and interest credited to contractholder funds - - - - (1,047) (599) (967) - - (2,613) Amortization of deferred policy acquisition costs (4,205) - (4,205) (296) (134) (142) (7) - - (4,784) Operating costs and expenses (3,555) (3) (3,558) (493) (238) (266) (35) (172) 104 (4,658) Restructuring and related charges (91) - (91) (13) (2) (3) - - - (109) Goodwill impairment - - - - - - - (125) - (125) Interest expense (1) - (1) - - - - (334) - (335) Underwriting income (loss) $ 2,111 $ (99) 2,012 Net investment income 1,478 16 489 72 1,305 41 - 3,401 Realized capital gains and losses 401 - 5 1 44 (6) - 445 Gain on disposition of operations 14 - - - 6 - - 20 Income tax (expense) benefit (1,318) 193 224 (1) 58 42 - (802) Preferred stock dividends - - - - - (116) - (116) Net income (loss) applicable to common shareholders $ 2,587 $ 15 $ 577 $ 146 $ 418 $ (670) $ - $ 3,073 Realized capital gains and losses, after-tax (272) - (2) - (28) 4 - (298) Valuation changes on embedded derivatives not hedged, after-tax - - - - - - - - DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax - - 10 - - - - 10 Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax (3) - - - - - - (3) Business combination expenses and the amortization of purchased intangible assets, after-tax 5 60 - - - 14 - 79 Gain on disposition of operations, after-tax (9) - - - (4) - - (13) Goodwill impairment - - - - - 125 - 125 Tax Legislation expense (benefit) 65 (134) (332) (51) (182) 128 - (506) Adjusted net income (loss) * $ 2,373 $ (59) (1) $ 253 (1) $ 95 (1) $ 204 (1) $ (399) (1) $ - $ 2,467 Discontinued Total Allstate Lines and Property- Service Allstate Allstate Allstate Corporate Intersegment Twelve months ended December 31, 2016 Protection Coverages Liability Businesses Life Benefits Annuities and Other Eliminations Consolidated Premiums and contract charges $ 30,727 $ - $ 30,727 $ 580 $ 1,250 $ 1,011 $ 14 $ - $ - $ 33,582 Intersegment insurance premiums and service fees - - - 105 - - - - (105) - Claims and claims expense (21,863) (105) (21,968) (258) - - - - 5 (22,221) Contract benefits and interest credited to contractholder funds - - - - (1,027) (545) (1,011) - - (2,583) Amortization of deferred policy acquisition costs (4,053) - (4,053) (214) (131) (145) (7) - - (4,550) Operating costs and expenses (3,455) (2) (3,457) (223) (225) (240) (32) (29) 100 (4,106) Restructuring and related charges (29) - (29) - (1) - - - - (30) Interest expense - - - - - - - (295) - (295) Underwriting income (loss) $ 1,327 $ (107) 1,220 Net investment income 1,253 13 482 71 1,181 42 - 3,042 Realized capital gains and losses (6) - (38) (5) (38) (3) - (90) Gain on disposition of operations - - - - 5 - - 5 Income tax (expense) benefit (806) - (91) (51) (36) 107 - (877) Preferred stock dividends - - - - - (116) - (116) Net income (loss) applicable to common shareholders $ 1,661 $ 3 $ 219 $ 96 $ 76 $ (294) $ - $ 1,761 Realized capital gains and losses, after-tax - - 24 4 26 2 - 56 Valuation changes on embedded derivatives not hedged, after-tax - - - - 2 - - 2 DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax - - 4 - - - - 4 Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax (3) - - - - - - (3) Business combination expenses and the amortization of purchased intangible assets, after-tax 21 - - - - - - 21 Gain on disposition of operations, after-tax - - - - (3) - - (3) Adjusted net income (loss) * $ 1,679 $ 3 (1) $ 247 (1) $ 100 (1) $ 101 (1) $ (292) (1) $ - $ 1,838 (1) THE ALLSTATE CORPORATION CONSOLIDATING SEGMENT RESULTS ($ in millions) Adjusted net income is the segment measure used for each business.

6 Discontinued Total Allstate Lines and Property- Service Allstate Allstate Allstate Corporate Intersegment Twelve months ended December 31, 2015 Protection Coverages Liability Businesses Life Benefits Annuities and Other Eliminations Consolidated Premiums and contract charges $ 29,748 $ - $ 29,748 $ 561 $ 1,223 $ 921 $ 14 $ - $ - $ 32,467 Intersegment insurance premiums and service fees - - - 42 - - - - (42) - Claims and claims expense (20,718) (53) (20,771) (277) - - - - 14 (21,034) Contract benefits and interest credited to contractholder funds - - - - (1,031) (488) (1,045) - - (2,564) Amortization of deferred policy acquisition costs (3,933) - (3,933) (169) (133) (124) (5) - - (4,364) Operating costs and expenses (3,437) (2) (3,439) (164) (212) (222) (38) (34) 28 (4,081) Restructuring and related charges (39) - (39) - (1) - 1 - - (39) Interest expense - - - - - - - (292) - (292) Underwriting income (loss) $ 1,621 $ (55) 1,566 Net investment income 1,226 11 490 71 1,323 35 - 3,156 Realized capital gains and losses (237) - 2 1 264 - - 30 (Loss) gain on disposition of operations - - (1) - 4 - - 3 Income tax (expense) benefit (867) (2) (108) (55) (188) 109 - (1,111) Preferred stock dividends - - - - - (116) - (116) Net income applicable to common shareholders $ 1,688 $ 2 $ 229 $ 104 $ 330 $ (298) $ - $ 2,055 Realized capital gains and losses, after-tax 154 - (1) - (172) - - (19) Valuation changes on embedded derivatives not hedged, after-tax - - - - 1 - - 1 DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax - - 4 - (1) - - 3 Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax (2) - - - - - - (2) Business combination expenses and the amortization of purchased intangible assets, after-tax 32 - - - - - - 32 (Loss) gain on disposition of operations, after-tax - - 1 - (3) - - (2) Change in accounting for investments in qualified affordable housing projects, after-tax 28 - 6 - 11 - - 45 Adjusted net income (loss) * $ 1,900 $ 2 (1) $ 239 (1) $ 104 (1) $ 166 (1) $ (298) (1) $ - $ 2,113 (1) Adjusted net income is the segment measure used for each business. THE ALLSTATE CORPORATION HISTORICAL CONSOLIDATING SEGMENT RESULTS ($ in millions)

7 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec 31, Sept. 30, June 30, March 31, Dec. 31, 2017 2017 2017 2017 2016 2017 2017 2017 2017 2016 Assets Liabilities Investments Reserve for property and casualty insurance claims and Fixed income securities, at fair value claims expense $ 26,325 $ 27,154 $ 25,884 $ 25,628 $ 25,250 (amortized cost $57,525, $57,608, Reserve for life-contingent contract benefits 12,549 12,227 12,234 12,223 12,239 $56,901, $57,194 and $56,576) $ 58,992 $ 59,391 $ 58,656 $ 58,636 $ 57,839 Contractholder funds 19,434 19,650 19,832 20,051 20,260 Equity securities, at fair value Unearned premiums 13,473 13,535 13,024 12,705 12,583 (cost $5,461, $5,468, $5,321, Claim payments outstanding 875 959 939 845 879 $5,026 and $5,157) 6,621 6,434 6,117 5,685 5,666 Deferred income taxes 782 1,249 1,104 833 487 Mortgage loans 4,534 4,322 4,336 4,349 4,486 Other liabilities and accrued expenses 6,639 6,968 6,583 7,018 6,599 Limited partnership interests 6,740 6,600 6,206 5,982 5,814 Long-term debt 6,350 6,349 6,348 6,346 6,347 Short-term, at fair value Separate Accounts 3,444 3,422 3,416 3,436 3,393 (amortized cost $1,944, $2,198, Total liabilities 89,871 91,513 89,364 89,085 88,037 $2,175, $2,753 and $4,288) 1,944 2,198 2,175 2,753 4,288 Other 3,972 3,826 3,815 3,738 3,706 Equity Total investments 82,803 82,771 81,305 81,143 81,799 Preferred stock and additional capital paid-in, 72.2 thousand shares outstanding 1,746 1,746 1,746 1,746 1,746 Common stock, 355 million, 360 million, 361 million, 365 million and 366 million shares outstanding (2) 9 9 9 9 9 Additional capital paid-in 3,313 3,330 3,269 3,285 3,303 Cash 617 690 482 442 436 Retained income 43,211 (3) 42,125 41,622 41,208 40,678 Premium installment receivables, net 5,786 5,922 5,693 5,649 5,597 Deferred ESOP expense (3) (6) (6) (6) (6) Deferred policy acquisition costs 4,191 4,147 4,037 3,988 3,954 Treasury stock, at cost (545 million, 540 million, 539 million, Reinsurance recoverables, net (1) 8,921 9,748 8,722 8,723 8,745 535 million and 534 million shares) (25,982) (25,413) (25,241) (24,887) (24,741) Accrued investment income 569 590 573 577 567 Accumulated other comprehensive income: Property and equipment, net 1,072 1,067 1,072 1,067 1,065 Unrealized net capital gains and losses 1,372 (3) 1,651 1,526 1,256 1,053 Goodwill 2,181 2,309 2,309 2,295 1,219 Unrealized foreign currency translation adjustments (3) (3) (14) (42) (53) (50) Other assets 2,838 2,966 3,256 2,923 1,835 Unrecognized pension and other postretirement benefit cost (1,112) (3) (1,309) (1,382) (1,400) (1,419) Separate Accounts 3,444 3,422 3,416 3,436 3,393 Total accumulated other comprehensive income (loss) 257 (3) 328 102 (197) (416) Total shareholders' equity 22,551 22,119 21,501 21,158 20,573 Total assets $ 112,422 $ 113,632 $ 110,865 $ 110,243 $ 108,610 Total liabilities and shareholders' equity $ 112,422 $ 113,632 $ 110,865 $ 110,243 $ 108,610 (1) (2) (3) In January 2018, the FASB issued a Proposed Accounting Standards Update titled “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” requiring reclassification of the impact of the newly enacted tax rates on the unrealized balances presented net of tax in accumulated other comprehensive income to retained income. We plan to early adopt the new guidance as of December 31, 2017, when finalized. The impact of the adoption will decrease retained income by $49 million, increase unrealized net capital gains and losses by $290 million, decrease unrealized foreign currency translation adjustments by $6 million and decrease unrecognized pension and other postretirement benefit cost by $235 million. Common shares outstanding were 354,690,536; 359,787,293; 361,280,366; 365,015,746 and 365,771,746 as of December 31, 2017, September 30, 2017, June 30, 2017, March 31, 2017 and December 31, 2016, respectively. Reinsurance recoverables of unpaid losses related to Allstate Protection, Discontinued Lines and Coverages and Service Businesses segments were $6.47 billion, $7.26 billion, $6.21 billion, $6.18 billion and $6.18 billion as of December 31, 2017, September 30, 2017, June 30, 2017, March 31, 2017 and December 31, 2016, respectively. THE ALLSTATE CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION ($ in millions)

8 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2017 2017 2017 2017 2016 2016 2016 2016 Book value per common share Numerator: Common shareholders' equity (1) $ 20,805 $ 20,373 $ 19,755 $ 19,412 $ 18,827 $ 19,188 $ 18,807 $ 18,594 Denominator: Common shares outstanding and dilutive potential common shares outstanding 361.3 365.8 367.0 370.4 370.8 372.7 375.8 380.3 Book value per common share $ 57.58 $ 55.69 $ 53.83 $ 52.41 $ 50.77 $ 51.48 $ 50.05 $ 48.89 Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities Numerator: Common shareholders' equity $ 20,805 $ 20,373 $ 19,755 $ 19,412 $ 18,827 $ 19,188 $ 18,807 $ 18,594 Unrealized net capital gains and losses on fixed income securities 622 (2) 1,028 1,013 831 727 1,506 1,407 993 Adjusted common shareholders' equity $ 20,183 $ 19,345 $ 18,742 $ 18,581 $ 18,100 $ 17,682 $ 17,400 $ 17,601 Denominator: Common shares outstanding and dilutive potential common shares outstanding 361.3 365.8 367.0 370.4 370.8 372.7 375.8 380.3 Book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities * $ 55.86 (2) $ 52.88 $ 51.07 $ 50.16 $ 48.81 $ 47.44 $ 46.30 $ 46.28 (1) (2) THE ALLSTATE CORPORATION BOOK VALUE PER COMMON SHARE ($ in millions, except per share data) Excludes equity related to preferred stock of $1,746 million in each period. In January 2018, the FASB issued a Proposed Accounting Standards Update titled “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” requiring reclassification of the impact of the newly enacted tax rates on the unrealized balances presented net of tax in accumulated other comprehensive income to retained income. We plan to early adopt the new guidance as of December 31, 2017, when finalized. The impact of the adoption will increase the unrealized net capital gains and losses on fixed income securities by $135 million and decrease book value per common share, excluding the impact of unrealized net capital gains and losses on fixed income securities, by $0.37.

9 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2017 2017 2017 2017 2016 2016 2016 2016 Return on Common Shareholders' Equity Numerator: Net income applicable to common shareholders (1) $ 3,073 $ 2,664 $ 2,518 $ 2,210 $ 1,761 $ 1,410 $ 1,540 $ 1,624 Denominator: Beginning common shareholders' equity $ 18,827 $ 19,188 $ 18,807 $ 18,594 $ 18,279 $ 18,758 $ 19,552 $ 20,433 Ending common shareholders' equity 20,805 20,373 19,755 19,412 18,827 19,188 18,807 18,594 Average common shareholders' equity (2) $ 19,816 $ 19,781 $ 19,281 $ 19,003 $ 18,553 $ 18,973 $ 19,180 $ 19,514 Return on common shareholders' equity (3) 15.5 % 13.5 % 13.1 % 11.6 % 9.5 % 7.4 % 8.0 % 8.3 % Adjusted Net Income Return on Common Shareholders' Equity Numerator: Adjusted net income * (1) $ 2,467 $ 2,512 $ 2,399 $ 2,124 $ 1,838 $ 1,656 $ 1,792 $ 1,819 Denominator: Beginning common shareholders' equity $ 18,827 $ 19,188 $ 18,807 $ 18,594 $ 18,279 $ 18,758 $ 19,552 $ 20,433 Less: Unrealized net capital gains and losses 1,053 1,817 1,624 1,200 620 879 1,419 2,137 Adjusted beginning common shareholders' equity 17,774 17,371 17,183 17,394 17,659 17,879 18,133 18,296 Ending common shareholders' equity 20,805 20,373 19,755 19,412 18,827 19,188 18,807 18,594 Less: Unrealized net capital gains and losses 1,372 1,651 1,526 1,256 1,053 1,817 1,624 1,200 Adjusted ending common shareholders' equity 19,433 18,722 18,229 18,156 17,774 17,371 17,183 17,394 Average adjusted common shareholders' equity (2) $ 18,604 $ 18,047 $ 17,706 $ 17,775 $ 17,717 $ 17,625 $ 17,658 $ 17,845 Adjusted net income return on common shareholders' equity *(3)(4) 13.3 % 13.9 % 13.5 % 11.9 % 10.4 % 9.4 % 10.1 % 10.2 % (1) (2) (3) (4) The Tax Legislation adjustment recorded in fourth quarter 2017 increased return on common shareholders' equity by 2.4 points and decreased adjusted net income return on common shareholders' equity by 0.1 points. In January 2018, the FASB issued a Proposed Accounting Standards Update titled “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” requiring reclassification of the impact of the newly enacted tax rates on the unrealized balances presented net of tax in accumulated other comprehensive income to retained income. We plan to early adopt the new guidance as of December 31, 2017, when finalized. The impact of the adoption will increase the adjusted net income return on equity calculation by 0.1 points. 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. THE ALLSTATE CORPORATION RETURN ON COMMON SHAREHOLDERS' EQUITY ($ in millions) Twelve months ended Net income applicable to common shareholders and adjusted net income reflect a trailing twelve-month period.

10 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2017 2017 2017 2017 2016 2016 2016 2016 Debt Short-term debt $ - $ - $ - $ - $ - $ - $ - $ - Long-term debt 6,350 6,349 6,348 6,346 6,347 5,110 5,109 5,108 Total debt $ 6,350 $ 6,349 $ 6,348 $ 6,346 $ 6,347 $ 5,110 $ 5,109 $ 5,108 Capital resources Debt $ 6,350 $ 6,349 $ 6,348 $ 6,346 $ 6,347 $ 5,110 $ 5,109 $ 5,108 Shareholders' equity Preferred stock and additional capital paid-in 1,746 1,746 1,746 1,746 1,746 1,746 1,746 1,746 Common stock 9 9 9 9 9 9 9 9 Additional capital paid-in 3,313 3,330 3,269 3,285 3,303 3,237 3,203 3,237 Retained income 43,211 42,125 41,622 41,208 40,678 39,990 39,623 39,505 Deferred ESOP expense (3) (6) (6) (6) (6) (13) (13) (13) Treasury stock (25,982) (25,413) (25,241) (24,887) (24,741) (24,537) (24,310) (23,994) Unrealized net capital gains and losses 1,372 1,651 1,526 1,256 1,053 1,817 1,624 1,200 Unrealized foreign currency translation adjustments (3) (14) (42) (53) (50) (48) (41) (46) Unrecognized pension and other postretirement benefit cost (1,112) (1,309) (1,382) (1,400) (1,419) (1,267) (1,288) (1,304) Total shareholders' equity 22,551 22,119 21,501 21,158 20,573 20,934 20,553 20,340 Total capital resources $ 28,901 $ 28,468 $ 27,849 $ 27,504 $ 26,920 $ 26,044 $ 25,662 $ 25,448 Ratio of debt to shareholders' equity 28.2 % 28.7 % 29.5 % 30.0 % 30.9 % 24.4 % 24.9 % 25.1 % Ratio of debt to capital resources 22.0 % 22.3 % 22.8 % 23.1 % 23.6 % 19.6 % 19.9 % 20.1 % THE ALLSTATE CORPORATION DEBT TO CAPITAL ($ in millions)

11 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 1,249 $ 666 $ 579 $ 695 $ 840 $ 520 $ 271 $ 246 $ 3,189 $ 1,877 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, amortization and other non-cash items 125 120 119 119 97 97 97 91 483 382 Realized capital gains and losses (127) (103) (81) (134) (2) (33) (24) 149 (445) 90 Gain on disposition of operations (5) (1) (12) (2) (1) (1) (1) (2) (20) (5) Interest credited to contractholder funds 168 174 175 173 168 183 185 190 690 726 Goodwill impairment 125 - - - - - - - 125 - Changes in: Policy benefits and other insurance reserves (974) 1,048 45 183 (347) 401 118 459 302 631 Unearned premiums (62) 491 282 (248) (178) 478 267 (205) 463 362 Deferred policy acquisition costs (38) (111) (79) 14 (6) (87) (65) (7) (214) (165) Premium installment receivables, net 136 (216) (32) (19) 194 (209) (38) 11 (131) (42) Reinsurance recoverables, net 806 (1,023) (5) 11 156 (300) (80) (40) (211) (264) Income taxes (364) 161 (326) 284 387 206 (150) (26) (245) 417 Other operating assets and liabilities 61 660 (174) (219) (57) 129 64 (152) 328 (16) Net cash provided by operating activities 1,100 1,866 491 857 1,251 1,384 644 714 4,314 3,993 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sales Fixed income securities 5,833 4,987 7,438 7,083 5,929 6,543 6,373 6,216 25,341 25,061 Equity securities 1,325 1,749 829 2,601 1,477 1,582 823 1,664 6,504 5,546 Limited partnership interests 358 286 271 210 247 271 183 180 1,125 881 Mortgage loans - - - - - - (7) 7 - - Other investments 104 52 94 24 56 62 57 87 274 262 Investment collections Fixed income securities 1,156 975 1,034 1,029 1,103 1,292 1,189 949 4,194 4,533 Mortgage loans 123 172 82 223 98 253 71 79 600 501 Other investments 184 121 163 174 140 113 125 43 642 421 Investment purchases Fixed income securities (7,210) (6,721) (8,414) (8,800) (5,708) (9,335) (7,546) (5,401) (31,145) (27,990) Equity securities (1,289) (1,823) (1,090) (2,383) (1,837) (1,441) (939) (1,733) (6,585) (5,950) Limited partnership interests (358) (504) (310) (268) (322) (425) (433) (270) (1,440) (1,450) Mortgage loans (335) (163) (62) (86) (186) (196) (220) (44) (646) (646) Other investments (299) (168) (313) (219) (211) (225) (196) (253) (999) (885) Change in short-term investments, net 353 115 570 1,572 (2,540) 763 688 (1,357) 2,610 (2,446) Change in other investments, net (2) (135) 117 (10) 9 (21) (20) (19) (30) (51) Purchases of property and equipment, net (83) (70) (72) (74) (123) (70) (68) (52) (299) (313) Acquisition of operations - - - (1,356) - - - - (1,356) - Net cash (used in) provided by investing activities (140) (1,127) 337 (280) (1,868) (834) 80 96 (1,210) (2,526) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of long-term debt - - - - 1,236 - - - - 1,236 Repayments of long-term debt - - - - (1) - - (16) - (17) Contractholder fund deposits 258 252 258 257 264 263 261 261 1,025 1,049 Contractholder fund withdrawals (474) (459) (474) (483) (550) (524) (521) (492) (1,890) (2,087) Dividends paid on common stock (134) (134) (135) (122) (122) (124) (125) (115) (525) (486) Dividends paid on preferred stock (29) (29) (29) (29) (29) (29) (29) (29) (116) (116) Treasury stock purchases (647) (191) (393) (264) (183) (250) (448) (456) (1,495) (1,337) Shares reissued under equity incentive plans, net 3 24 41 67 41 51 42 30 135 164 Excess tax benefits on share-based payment arrangements - - - - 7 5 8 12 - 32 Other (10) 6 (56) 3 1 1 3 31 (57) 36 Net cash (used in) provided by financing activities (1,033) (531) (788) (571) 664 (607) (809) (774) (2,923) (1,526) NET (DECREASE) INCREASE IN CASH (73) 208 40 6 47 (57) (85) 36 181 (59) CASH AT BEGINNING OF PERIOD 690 482 442 436 389 446 531 495 436 495 CASH AT END OF PERIOD $ 617 $ 690 $ 482 $ 442 $ 436 $ 389 $ 446 $ 531 $ 617 $ 436 THE ALLSTATE CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS ($ in millions) Three months ended Twelve months ended

12 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 changes in capital gains balance Sept. 30, 2017 deferred adjustments (1)(2) not hedged (2) assumptions (2) and losses Dec. 31, 2017 Allstate Protection $ 1,511 $ 1,090 $ (1,091) $ - $ - $ - $ 1,510 Service Businesses 921 112 (79) - - - 954 Allstate Life Traditional life and accident and health 458 17 (10) - - - 465 Interest-sensitive life 684 17 (18) (2) - 6 687 Subtotal 1,142 34 (28) (2) - 6 1,152 Allstate Benefits Traditional life and accident and health 399 35 (31) - - - 403 Interest-sensitive life 139 6 (6) - - - 139 Subtotal 538 41 (37) - - - 542 Allstate Annuities Fixed annuity 35 - (2) - - - 33 Consolidated $ 4,147 $ 1,277 $ (1,237) $ (2) $ - $ 6 $ 4,191 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 changes in capital gains balance Sept. 30, 2016 deferred adjustments (1)(2) not hedged (2) assumptions (2) and losses Dec. 31, 2016 Allstate Protection $ 1,453 $ 1,008 $ (1,029) $ - $ - $ - $ 1,432 Service Businesses 733 80 (57) - - - 756 Allstate Life Traditional life and accident and health 432 16 (10) - - - 438 Interest-sensitive life 707 18 (22) (1) - 60 762 Subtotal 1,139 34 (32) (1) - 60 1,200 Allstate Benefits Traditional life and accident and health 378 35 (31) - - - 382 Interest-sensitive life 141 6 (5) - - 2 144 Subtotal 519 41 (36) - - 2 526 Allstate Annuities Fixed annuity 42 - (2) - - - 40 Consolidated $ 3,886 $ 1,163 $ (1,156) $ (1) $ - $ 62 $ 3,954 (1) (2) Included as a component of amortization of DAC on the Consolidated Statements of Operations. Change in Deferred Policy Acquisition Costs For the three months ended December 31, 2016 Amortization before adjustments reflects total DAC amortization before amortization/accretion related to realized capital gains and losses and valuation changes on embedded derivatives not hedged and amortization acceleration/deceleration for changes in assumptions. For the three months ended December 31, 2017 THE ALLSTATE CORPORATION ANALYSIS OF DEFERRED POLICY ACQUISITION COSTS ($ in millions) Change in Deferred Policy Acquisition Costs

13 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 Ending unrealized unrealized unrealized balance costs before embedded derivatives for changes in capital gains balance capital gains capital gains capital gains Dec. 31, 2016 deferred adjustments (1)(2) not hedged (2) assumptions (2) and losses Dec. 31, 2017 and losses and losses and losses Allstate Protection $ 1,432 $ 4,283 $ (4,205) $ - $ - $ - $ 1,510 $ 1,510 $ - $ 1,510 Service Businesses 756 494 (3) (296) - - - 954 954 - 954 Allstate Life Traditional life and accident and health 438 66 (39) - - - 465 465 - 465 Interest-sensitive life 762 66 (95) (14) 14 (46) 687 872 (185) 687 Subtotal 1,200 132 (134) (14) 14 (46) 1,152 1,337 (185) 1,152 Allstate Benefits Traditional life and accident and health 382 138 (117) - - - 403 403 - 403 Interest-sensitive life 144 20 (24) - (1) - 139 140 (1) 139 Subtotal 526 158 (141) - (1) - 542 543 (1) 542 Allstate Annuities Fixed annuity 40 - (7) - - - 33 33 - 33 Consolidated $ 3,954 $ 5,067 $ (4,783) $ (14) $ 13 $ (46) $ 4,191 $ 4,377 $ (186) $ 4,191 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 Ending unrealized unrealized unrealized balance costs before embedded derivatives for changes in capital gains balance capital gains capital gains capital gains Dec. 31, 2015 deferred adjustments (1)(2) not hedged (2) assumptions (2) and losses Dec. 31, 2016 and losses and losses and losses Allstate Protection $ 1,410 $ 4,075 $ (4,053) $ - $ - $ - $ 1,432 $ 1,432 $ - $ 1,432 Service Businesses 619 351 (214) - - - 756 756 - 756 Allstate Life Traditional life and accident and health 424 57 (43) - - - 438 438 - 438 Interest-sensitive life 847 77 (88) (6) 6 (74) 762 900 (138) 762 Subtotal 1,271 134 (131) (6) 6 (74) 1,200 1,338 (138) 1,200 Allstate Benefits Traditional life and accident and health 368 133 (119) - - - 382 382 - 382 Interest-sensitive life 146 24 (22) - (4) - 144 145 (1) 144 Subtotal 514 157 (141) - (4) - 526 527 (1) 526 Allstate Annuities Fixed annuity 47 - (7) - - - 40 40 - 40 Consolidated $ 3,861 $ 4,717 $ (4,546) $ (6) $ 2 $ (74) $ 3,954 $ 4,093 $ (139) $ 3,954 (1) (2) Included as a component of amortization of DAC on the Consolidated Statements of Operations. (3) Includes $66 million recorded in connection with the SquareTrade acquisition on January 3, 2017. For the twelve months ended December 31, 2017 Acquisition Costs as of December 31, 2017 THE ALLSTATE CORPORATION ANALYSIS OF DEFERRED POLICY ACQUISITION COSTS ($ in millions) Change in Deferred Policy Acquisition Costs Reconciliation of Deferred Policy Change in Deferred Policy Acquisition Costs Reconciliation of Deferred Policy For the twelve months ended December 31, 2016 Acquisition Costs as of December 31, 2016 Amortization before adjustments reflects total DAC amortization before amortization/accretion related to realized capital gains and losses and valuation changes on embedded derivatives not hedged and amortization acceleration/deceleration for changes in assumptions.

14 2017 2016 2015 2014 2013 Consolidated statement of operations data: Insurance premiums and contract charges $ 34,678 $ 33,582 $ 32,467 $ 31,086 $ 29,970 Net investment income 3,401 3,042 3,156 3,459 3,943 Realized capital gains and losses 445 (90) 30 694 594 Total revenues $ 38,524 $ 36,534 $ 35,653 $ 35,239 $ 34,507 Net income applicable to common shareholders $ 3,073 $ 1,761 $ 2,055 $ 2,746 $ 2,263 Realized capital gains and losses, after-tax (298) 56 (19) (451) (385) Valuation changes on embedded derivatives not hedged, after-tax - 2 1 15 16 DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax 10 4 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 (3) (3) (2) (7) 7 Amortization of purchased intangible assets, after-tax 79 21 32 45 55 (Gain) loss on disposition of operations, after-tax (13) (3) (2) 16 515 Loss on extinguishment of debt, after-tax - - - - 319 Postretirement benefits curtailment gain, after-tax - - - - (118) Change in accounting for investments in qualified affordable housing projects - - 45 - - Goodwill impairment 125 - - - - Tax Legislation benefit (506) - - - - Adjusted net income * $ 2,467 $ 1,838 $ 2,113 $ 2,367 $ 2,670 Income per common share - Diluted Net income applicable to common shareholders $ 8.36 $ 4.67 $ 5.05 $ 6.27 $ 4.81 Realized capital gains and losses, after-tax (0.81) 0.15 (0.05) (1.03) (0.82) Valuation changes on embedded derivatives not hedged, after-tax - - - 0.03 0.03 DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives not hedged, after-tax 0.03 0.01 - 0.01 0.01 DAC and DSI unlocking relating to realized capital gains and losses, after-tax - - - - (0.01) Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax (0.01) (0.01) - (0.02) 0.01 Amortization of purchased intangible assets, after-tax 0.22 0.06 0.08 0.10 0.12 (Gain) loss on disposition of operations, after-tax (0.04) (0.01) - 0.04 1.10 Loss on extinguishment of debt, after-tax - - - - 0.68 Postretirement benefits curtailment gain, after-tax - - - - (0.25) Change in accounting for investments in qualified affordable housing projects - - 0.11 - - Goodwill impairment 0.34 Tax Legislation benefit (1.38) Adjusted net income * $ 6.71 $ 4.87 $ 5.19 $ 5.40 $ 5.68 Net income applicable to common shareholders per share - Basic $ 8.49 $ 4.72 $ 5.12 $ 6.37 $ 4.87 Consolidated statement of financial position data: Investments $ 82,803 $ 81,799 $ 77,758 $ 81,113 $ 81,155 Total assets 112,422 108,610 104,656 108,479 123,460 Reserves for claims and claims expense, life-contingent contract benefits and contractholder funds 58,308 57,749 57,411 57,832 58,547 Debt 6,350 6,347 5,124 5,140 6,141 Shareholders' equity 22,551 20,573 20,025 22,304 21,480 Book value per share 57.58 50.77 47.34 48.24 45.31 Operating ratio: Annual statutory premiums written to surplus ratio (U.S. property-liability operations) 1.7x 1.9x 1.9x 1.8x 1.6x Other operating data: Total employees (1) 42,900 43,500 41,600 40,200 39,400 Total Allstate agencies (1)(2) 12,400 12,200 12,300 11,900 11,600 (1) (2) Total Allstate agencies represents exclusive Allstate agencies and financial representatives in the United States and employee producers in Canada. As of or for the Year Ended December 31, THE ALLSTATE CORPORATION HISTORICAL CONSOLIDATED OPERATING AND FINANCIAL POSITION DATA ($ in millions except per share data) Rounded to the nearest hundred.

15 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Policies in Force statistics (in thousands) 2017 2017 2017 2017 2016 2016 2016 2016 Allstate Protection (1) Allstate brand Auto 19,580 19,513 19,548 19,565 19,742 19,852 20,061 20,145 Homeowners 6,088 6,071 6,075 6,090 6,120 6,131 6,158 6,176 Landlord 694 697 703 710 716 720 726 732 Renter 1,588 1,578 1,564 1,563 1,568 1,557 1,554 1,556 Condominium 663 662 662 663 666 665 667 667 Other 1,278 1,275 1,270 1,264 1,264 1,260 1,256 1,253 Other personal lines 4,223 4,212 4,199 4,200 4,214 4,202 4,203 4,208 Commercial lines 245 251 262 272 285 296 308 318 Total 30,136 30,047 30,084 30,127 30,361 30,481 30,730 30,847 Esurance brand Auto 1,352 1,369 1,388 1,400 1,391 1,395 1,409 1,428 Homeowners 79 76 69 63 58 52 44 37 Other personal lines 44 45 47 48 47 47 47 46 Total 1,475 1,490 1,504 1,511 1,496 1,494 1,500 1,511 Encompass brand Auto 530 548 571 595 622 649 676 701 Homeowners 254 262 273 284 295 305 318 329 Other personal lines 85 88 91 94 98 101 105 108 Total 869 898 935 973 1,015 1,055 1,099 1,138 Allstate Protection Policies in Forces 32,480 32,435 32,523 32,611 32,872 33,030 33,329 33,496 Service Businesses (1) SquareTrade (2) 38,719 34,078 31,258 29,907 - - - - Allstate Roadside Services 699 708 724 743 768 797 824 856 Allstate Dealer Services 4,088 4,130 4,139 4,150 4,142 4,125 4,059 3,987 Total 43,506 38,916 36,121 34,800 4,910 4,922 4,883 4,843 Allstate Life (1) 2,026 2,019 2,020 2,017 2,023 2,019 2,022 2,021 Allstate Benefits (1) 4,033 4,035 4,064 3,992 3,755 3,733 3,752 3,726 Allstate Annuities (1) 231 236 240 246 251 256 261 267 Total Policies in Force 82,276 77,641 74,968 73,666 43,811 43,960 44,247 44,353 Agency Data (3) Total Allstate agencies (4) 12,400 12,200 12,200 12,200 12,200 12,200 12,200 12,100 Licensed sales professionals (5) 24,800 23,900 24,000 23,600 23,800 23,600 23,800 24,000 Allstate independent agencies (6) 2,400 2,400 2,300 2,200 2,200 2,200 2,000 2,100 (1) (2) • • (3) • (4) • (5) (6) • • • A multi-car customer would generate multiple item (policy) counts, even if all cars were insured under one policy. Non-proprietary products offered by Ivantage (insurance agency) and Answer Financial (independent insurance agency) are Allstate Roadside Services reflects memberships in force and do not include their wholesale partners as the customer Allstate Dealer Services reflects service contracts and other products sold in conjunction with auto lending and vehicle sales transactions and do not include their third party administrators (“TPAs”) as the customer relationship is managed by the TPAs. SquareTrade represents active consumer product protection plans. Allstate Life insurance policies and Allstate 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. THE ALLSTATE CORPORATION POLICIES IN FORCE AND OTHER STATISTICS Allstate Benefits reflects certificate counts as opposed to group counts. not included. SquareTrade had PIF of 28.5 million, 25.8 million, 24.4 million and 23.0 million at December 31, 2016, September 30, 2016, June 30, 2016, and March 31, 2016, respectively. These numbers are prior to the acquisition of SquareTrade on January 3, 2017, so they are not reflected in the periods above. relationship is managed by the wholesale partner. Includes 703 and 488 engaged Allstate independent agencies (“AIAs”) as of December 31, 2017 and December 31, 2016, respectively. Engaged AIAs, as currently determined, include those that achieve a minimum number of new policies written. Rounded to the nearest hundred. Employees of Allstate agencies who are licensed to sell Allstate products. Total Allstate agencies represents exclusive Allstate agencies and financial representatives in the United States and employee producers in Canada. Policy counts are based on items rather than customers.

16 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Allstate Protection Allstate brand (1) Auto $ 4,956 $ 5,096 $ 4,925 $ 4,882 $ 4,756 $ 4,940 $ 4,767 $ 4,746 $ 19,859 $ 19,209 Homeowners 1,694 1,921 1,847 1,403 1,638 1,869 1,831 1,392 6,865 6,730 Landlord 132 138 130 120 133 141 133 122 520 529 Renter 68 86 75 67 68 84 75 67 296 294 Condominium 65 71 68 55 63 70 67 53 259 253 Other 145 159 168 126 129 152 153 111 598 545 Other personal lines 410 454 441 368 393 447 428 353 1,673 1,621 Commercial lines 125 116 124 123 115 123 135 126 488 499 Total 7,185 7,587 7,337 6,776 6,902 7,379 7,161 6,617 28,885 28,059 Esurance brand Auto 389 427 386 439 382 428 376 439 1,641 1,625 Homeowners 19 24 20 16 15 16 14 11 79 56 Other personal lines 2 2 2 2 2 2 2 2 8 8 Total 410 453 408 457 399 446 392 452 1,728 1,689 Encompass brand Auto 128 141 148 125 138 153 162 138 542 591 Homeowners 95 108 112 91 103 121 126 104 406 454 Other personal lines 20 22 25 20 22 25 27 21 87 95 Total 243 271 285 236 263 299 315 263 1,035 1,140 Total Allstate Protection Auto 5,473 5,664 5,459 5,446 5,276 5,521 5,305 5,323 $ 22,042 $ 21,425 Homeowners 1,808 2,053 1,979 1,510 1,756 2,006 1,971 1,507 7,350 7,240 Other personal lines 432 478 468 390 417 474 457 376 1,768 1,724 Commercial lines 125 116 124 123 115 123 135 126 488 499 Total 7,838 8,311 8,030 7,469 7,564 8,124 7,868 7,332 31,648 30,888 Discontinued Lines and Coverages (2) - - - - 1 2 - - - 3 Total Property-Liability $ 7,838 $ 8,311 $ 8,030 $ 7,469 $ 7,565 $ 8,126 $ 7,868 $ 7,332 $ 31,648 $ 30,891 Service Businesses (3) SquareTrade $ 156 $ 104 $ 85 $ 81 $ - $ - $ - $ - $ 426 $ - Allstate Roadside Services 60 68 66 69 67 79 77 77 263 300 Allstate Dealer Services 93 100 108 104 91 106 106 106 405 409 Total $ 309 $ 272 $ 259 $ 254 $ 158 $ 185 $ 183 $ 183 $ 1,094 $ 709 Total premiums written $ 8,147 $ 8,583 $ 8,289 $ 7,723 $ 7,723 $ 8,311 $ 8,051 $ 7,515 $ 32,742 $ 31,600 Non-Proprietary Premiums Ivantage (4) $ 1,643 $ 1,609 $ 1,584 $ 1,566 $ 1,544 $ 1,531 $ 1,528 $ 1,504 $ 1,643 $ 1,544 Answer Financial (5) 137 153 148 153 140 158 150 151 591 599 (1) Canada premiums included in Allstate brand Auto $ 196 $ 236 $ 228 $ 171 $ 182 $ 220 $ 234 $ 164 $ 831 $ 800 Homeowners 59 69 65 44 52 64 64 41 237 221 Other personal lines 15 19 16 12 13 16 16 10 62 55 Total $ 270 $ 324 $ 309 $ 227 $ 247 $ 300 $ 314 $ 215 $ 1,130 $ 1,076 (2) (3) (4) (5) Primarily represents retrospective reinsurance premium recognized when billed. THE ALLSTATE CORPORATION PREMIUMS WRITTEN FOR ALLSTATE PROTECTION AND SERVICE BUSINESSES ($ in millions) Three months ended Twelve months ended There are no premiums written for Arity, which is part of the Service Businesses segment. 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. Fees for the three and twelve months ended December 31, 2017 were $40.4 million and $166.6 million, respectively. Represents non-proprietary premiums written for the period. Commissions earned for the three and twelve months ended December 31, 2017 were $17.3 million and $71.1 million, respectively.

17 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Allstate Protection Allstate brand Auto $ 33 $ 366 $ 208 $ 65 $ 59 $ 150 $ 195 $ 137 $ 672 $ 541 Homeowners 480 383 650 575 183 259 644 574 2,088 1,660 Other personal lines 20 65 57 59 39 24 62 63 201 188 Commercial lines 2 13 2 7 7 7 12 9 24 35 Total 535 827 917 706 288 440 913 783 2,985 2,424 Esurance brand Auto - 15 15 4 4 9 9 2 34 24 Homeowners 1 2 9 4 1 5 5 1 16 12 Other personal lines - - - - - - - - - - Total 1 17 24 8 5 14 14 3 50 36 Encompass brand Auto - 1 7 4 - 5 3 2 12 10 Homeowners 59 11 42 61 9 21 29 38 173 97 Other personal lines 3 - 3 2 - 1 2 1 8 4 Total 62 12 52 67 9 27 34 41 193 111 Total Allstate Protection Auto 33 382 230 73 63 164 207 141 718 575 Homeowners 540 396 701 640 193 285 678 613 2,277 1,769 Other personal lines 23 65 60 61 39 25 64 64 209 192 Commercial lines 2 13 2 7 7 7 12 9 24 35 Total 598 856 993 781 302 481 961 827 3,228 2,571 Discontinued Lines and Coverages - - - - - - - - - - Total Property-Liability $ 598 $ 856 $ 993 $ 781 $ 302 $ 481 $ 961 $ 827 $ 3,228 $ 2,571 Service Businesses (1) $ 1 $ 5 $ - $ - $ 1 $ - $ - $ - $ 6 $ 1 Total catastrophe losses $ 599 $ 861 $ 993 $ 781 $ 303 $ 481 $ 961 $ 827 $ 3,234 $ 2,572 (1) Catastrophe losses relate to Allstate Dealer Services. THE ALLSTATE CORPORATION CATASTROPHE LOSSES ($ in millions) Twelve months endedThree months ended

18 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Prior Year Reserve Reestimates (1) Allstate Protection Auto $ (154) $ (189) $ (61) $ (86) $ (114) $ (10) $ (36) $ 5 $ (490) $ (155) Homeowners (45) (42) (20) (24) (32) (4) 19 (7) (131) (24) Other personal lines 1 - (9) 9 (1) (2) (11) 5 1 (9) Commercial lines 12 7 (2) 2 6 13 23 20 19 62 Total (186) (224) (92) (99) (141) (3) (5) 23 (601) (126) Discontinued Lines and Coverages 3 88 3 2 3 99 2 1 96 105 Total Property-Liability $ (183) $ (136) $ (89) $ (97) $ (138) $ 96 $ (3) $ 24 $ (505) $ (21) Service Businesses $ 1 $ 1 $ - $ - $ 1 $ 3 $ - $ - $ 2 $ 4 Total prior year reserve reestimates $ (182) $ (135) $ (89) $ (97) $ (137) $ 99 $ (3) $ 24 $ (503) $ (17) Allstate Protection by Brand Allstate brand $ (176) $ (221) $ (83) $ (105) $ (121) $ - $ (2) $ 13 $ (585) $ (110) Esurance brand - (1) (1) - (9) (4) (4) (4) (2) (21) Encompass brand (10) (2) (8) 6 (11) 1 1 14 (14) 5 Total $ (186) $ (224) $ (92) $ (99) $ (141) $ (3) $ (5) $ 23 $ (601) $ (126) Catastrophe Losses included in Prior Year Reserve Reestimates Allstate Protection Allstate brand $ (7) $ (7) $ (4) $ 2 $ (7) $ 2 $ 15 $ (4) $ (16) $ 6 Esurance brand - - (1) - - - - - (1) - Encompass brand (1) - (2) 2 - 1 (2) 1 (1) - Total $ (8) $ (7) $ (7) $ 4 $ (7) $ 3 $ 13 $ (3) $ (18) $ 6 Effect of Prior Year Reserve Reestimates on Combined Ratio (1)(2) Allstate Protection Auto (1.9) (2.4) (0.8) (1.0) (1.4) (0.1) (0.5) - (1.5) (0.5) Homeowners (0.5) (0.5) (0.3) (0.3) (0.4) (0.1) 0.3 (0.1) (0.4) (0.1) Other personal lines - - (0.1) 0.1 - - (0.1) - - - Commercial lines 0.1 0.1 - - 0.1 0.2 0.3 0.3 - 0.2 Total (2.3) (2.8) (1.2) (1.2) (1.7) - - 0.2 (1.9) (0.4) Discontinued Lines and Coverages 0.1 1.1 0.1 - - 1.3 - 0.1 0.3 0.3 Total Property-Liability (2.2) (1.7) (1.1) (1.2) (1.7) 1.3 - 0.3 (1.6) (0.1) Service Businesses - - - - - - - - - - Total prior year reserve reestimates (2.2) (1.7) (1.1) (1.2) (1.7) 1.3 - 0.3 (1.6) (0.1) Allstate Protection by brand Allstate brand (2.2) (2.8) (1.1) (1.3) (1.5) - - 0.1 (1.8) (0.3) Esurance brand - - - - (0.1) - - (0.1) - (0.1) Encompass brand (0.1) - (0.1) 0.1 (0.1) - - 0.2 (0.1) - Total (2.3) (2.8) (1.2) (1.2) (1.7) - - 0.2 (1.9) (0.4) (1) (2) Calculated using the total premiums earned for Allstate Protection, Discontinued Lines and Coverages and Service Businesses for the respective period. Favorable reserve reestimates are shown in parentheses. THE ALLSTATE CORPORATION PRIOR YEAR RESERVE REESTIMATES ($ in millions) Twelve months endedThree months ended

19 2017 2016 2015 Prior Year Reserve Reestimates (1) Allstate brand $ (585) $ (110) $ 36 Esurance brand (2) (21) (17) Encompass brand (14) 5 7 Allstate Protection (601) (126) 26 Discontinued Lines and Coverages 96 105 53 Total Property-Liability $ (505) $ (21) $ 79 Service Businesses $ 2 $ 4 $ 2 Total prior year reserve reestimates $ (503) $ (17) $ 81 Effect of Prior Year Reserve Reestimates on Combined Ratio (1)(2) Allstate brand (1.8) (0.3) 0.1 Esurance brand - (0.1) - Encompass brand (0.1) - - Allstate Protection (1.9) (0.4) 0.1 Discontinued Lines and Coverages 0.3 0.3 0.2 Total Property-Liability (1.6) (0.1) 0.3 Service Businesses - - - Total prior year reserve reestimates (1.6) (0.1) 0.3 (1) (2) Favorable reserve reestimates are shown in parentheses. Calculated using the total premiums earned for Allstate Protection, Discontinued Lines and Coverages and Service Businesses for the respective period. THE ALLSTATE CORPORATION HISTORICAL PRIOR YEAR RESERVE REESTIMATES ($ in millions) Twelve months ended December 31,

20 2017 2016 2015 2014 2013 (net of reinsurance) Net reserve for claims and claims expense, beginning of year $ 19,066 $ 17,977 $ 17,229 $ 17,193 $ 17,278 Acquisitions 17 - - - - Claims and claims expense Provision attributable to the current year 22,432 22,238 20,953 19,512 18,032 Change in provision attributable to prior years (1) (503) (17) 81 (84) (121) Total claims and claims expense 21,929 22,221 21,034 19,428 17,911 Payments Claims and claims expense attributable to current year (14,194) (14,222) (13,660) (12,924) (11,658) Claims and claims expense attributable to prior years (6,964) (6,910) (6,626) (6,468) (6,338) Total payments (21,158) (21,132) (20,286) (19,392) (17,996) Net reserve for claims and claims expense, end of year (2) $ 19,854 $ 19,066 $ 17,977 $ 17,229 $ 17,193 Percent change in loss reserves 4.1 % 6.1 % 4.3 % 0.2 % (0.5) % (1) Reserve reestimates due to: Asbestos and environmental claims $ 71 $ 90 $ 40 $ 102 $ 104 All other property and casualty claims (574) (107) 41 (186) (225) Change in pre-tax reserve $ (503) $ (17) $ 81 $ (84) $ (121) (2) THE ALLSTATE CORPORATION HISTORICAL LOSS RESERVES ($ in millions) As of and for the twelve months ended December 31, Net reserves for claims and claims expense are net of expected reinsurance recoveries of $6.47 billion, $6.18 billion, $5.89 billion, $5.69 billion and $4.66 billion at December 31, 2017, 2016, 2015, 2014, and 2013, respectively.

21 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Premiums written $ 7,838 $ 8,311 $ 8,030 $ 7,469 $ 7,565 $ 8,126 $ 7,868 $ 7,332 $ 31,648 $ 30,891 Decrease (increase) in unearned premiums 139 (456) (239) 298 214 (416) (204) 225 (258) (181) Other (6) 41 16 (8) (23) 9 8 23 43 17 Premiums earned 7,971 7,896 7,807 7,759 7,756 7,719 7,672 7,580 31,433 30,727 Claims and claims expense (5,190) (5,441) (5,607) (5,328) (5,024) (5,484) (5,837) (5,623) (21,566) (21,968) Amortization of deferred policy acquisition costs (1,091) (1,060) (1,032) (1,022) (1,029) (1,013) (1,005) (1,006) (4,205) (4,053) Operating costs and expenses (957) (899) (852) (851) (893) (858) (883) (823) (3,559) (3,457) Restructuring and related charges (18) (12) (51) (10) (9) (5) (10) (5) (91) (29) Underwriting income (loss) 715 484 265 548 801 359 (63) 123 2,012 1,220 Net investment income 415 368 387 308 334 307 313 299 1,478 1,253 Income tax expense on operations (373) (271) (207) (268) (385) (218) (70) (139) (1,119) (812) Realized capital gains and losses, after-tax 73 54 56 89 10 36 18 (64) 272 - Gain on disposition of operations, after-tax 2 1 6 - - - - - 9 - Tax Legislation expense (65) - - - - - - - (65) - Net income applicable to common shareholders $ 767 $ 636 $ 507 $ 677 $ 760 $ 484 $ 198 $ 219 $ 2,587 $ 1,661 Catastrophe losses $ 598 $ 856 $ 993 $ 781 $ 302 $ 481 $ 961 $ 827 $ 3,228 $ 2,571 Amortization of purchased intangible assets $ 2 $ 2 $ 1 $ 2 $ 5 $ 9 $ 9 $ 9 $ 7 $ 32 Operating ratios Claims and claims expense ("loss") ratio 65.1 68.9 71.8 68.6 64.8 71.0 76.1 74.2 68.6 71.5 Expense ratio 25.9 25.0 24.8 24.3 24.9 24.3 24.7 24.2 25.0 24.5 Combined ratio 91.0 93.9 96.6 92.9 89.7 95.3 100.8 98.4 93.6 96.0 Loss ratio 65.1 68.9 71.8 68.6 64.8 71.0 76.1 74.2 68.6 71.5 Less: effect of catastrophe losses 7.5 10.9 12.7 10.1 3.9 6.2 12.5 10.9 10.3 8.4 effect of prior year non-catastrophe reserve reestimates (2.2) (1.6) (1.0) (1.3) (1.7) 1.2 (0.2) 0.4 (1.6) (0.1) Underlying loss ratio * 59.8 59.6 60.1 59.8 62.6 63.6 63.8 62.9 59.9 63.2 Expense ratio 25.9 25.0 24.8 24.3 24.9 24.3 24.7 24.2 25.0 24.5 Less: effect of amortization of purchased intangible assets - - - - 0.1 0.1 0.1 0.1 - 0.1 Expense ratio, excluding the effect of amortization of purchased intangible assets 25.9 25.0 24.8 24.3 24.8 24.2 24.6 24.1 25.0 24.4 Reconciliation of combined ratio to underlying combined ratio Combined ratio 91.0 93.9 96.6 92.9 89.7 95.3 100.8 98.4 93.6 96.0 Effect of catastrophe losses (7.5) (10.9) (12.7) (10.1) (3.9) (6.2) (12.5) (10.9) (10.3) (8.4) Effect of prior year non-catastrophe reserve reestimates 2.2 1.6 1.0 1.3 1.7 (1.2) 0.2 (0.4) 1.6 0.1 Effect of amortization of purchased intangible assets - - - - (0.1) (0.1) (0.1) (0.1) - (0.1) Underlying combined ratio * 85.7 84.6 84.9 84.1 87.4 87.8 88.4 87.0 84.9 87.6 Effect of restructuring and related charges on combined ratio 0.2 0.2 0.7 0.1 0.1 0.1 0.1 0.1 0.3 0.1 Effect of Discontinued Lines and Coverages on combined ratio - 1.1 0.1 - 0.1 1.3 - - 0.3 0.3 THE ALLSTATE CORPORATION PROPERTY-LIABILITY RESULTS ($ in millions) Three months ended Twelve months ended

22 2017 2016 2015 Premiums written $ 31,648 $ 30,891 $ 30,115 Increase in unearned premium (258) (181) (253) Other 43 17 (114) Premiums earned 31,433 30,727 29,748 Claims and claims expense (21,566) (21,968) (20,771) Amortization of deferred policy acquisition costs (4,205) (4,053) (3,933) Operating costs and expenses (3,559) (3,457) (3,439) Restructuring and related charges (91) (29) (39) Underwriting income 2,012 1,220 1,566 Net investment income 1,478 1,253 1,226 Income tax expense on operations (1,119) (812) (922) Realized capital gains and losses, after-tax 272 - (154) Gain on disposition of operations, after-tax 9 - - Change in accounting for investments in qualified affordable housing projects - - (28) Tax Legislation expense (65) - - Net income applicable to common shareholders $ 2,587 $ 1,661 $ 1,688 Catastrophe losses $ 3,228 $ 2,571 $ 1,719 Amortization of purchased intangible assets $ 7 $ 32 $ 50 Operating ratios Loss ratio 68.6 71.5 69.8 Expense ratio 25.0 24.5 24.9 Combined ratio 93.6 96.0 94.7 Loss ratio 68.6 71.5 69.8 Less: effect of catastrophe losses 10.3 8.4 5.8 effect of prior year non-catastrophe reserve reestimates (1.6) (0.1) 0.3 Underlying loss ratio * 59.9 63.2 63.7 Expense ratio 25.0 24.5 24.9 Less: effect of amortization of purchased intangible assets - 0.1 0.1 Expense ratio, excluding the effect of amortization of purchased intangible assets 25.0 24.4 24.8 Reconciliation of combined ratio to underlying combined ratio Combined ratio 93.6 96.0 94.7 Effect of catastrophe losses (10.3) (8.4) (5.8) Effect of prior year non-catastrophe reserve reestimates 1.6 0.1 (0.3) Effect of amortization of purchased intangible assets - (0.1) (0.1) Underlying combined ratio * 84.9 87.6 88.5 Effect of restructuring and related charges on combined ratio 0.3 0.1 0.1 Effect of Discontinued Lines and Coverages on the combined ratio 0.3 0.3 0.2 THE ALLSTATE CORPORATION HISTORICAL PROPERTY-LIABILITY RESULTS ($ in millions) Twelve months ended December 31,

23 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Property-Liability Underwriting Summary Allstate Protection $ 719 $ 572 $ 270 $ 550 $ 804 $ 459 $ (61) $ 125 $ 2,111 $ 1,327 Discontinued Lines and Coverages (4) (88) (5) (2) (3) (100) (2) (2) (99) (107) Underwriting income (loss) $ 715 $ 484 $ 265 $ 548 $ 801 $ 359 $ (63) $ 123 $ 2,012 $ 1,220 Allstate Protection Underwriting Summary Premiums written $ 7,838 $ 8,311 $ 8,030 $ 7,469 $ 7,564 $ 8,124 $ 7,868 $ 7,332 $ 31,648 $ 30,888 Premiums earned $ 7,971 $ 7,896 $ 7,807 $ 7,759 $ 7,756 $ 7,719 $ 7,672 $ 7,580 $ 31,433 $ 30,727 Claims and claims expense (5,187) (5,353) (5,604) (5,326) (5,021) (5,385) (5,835) (5,622) (21,470) (21,863) Amortization of deferred policy acquisition costs (1,091) (1,060) (1,032) (1,022) (1,029) (1,013) (1,005) (1,006) (4,205) (4,053) Operating costs and expenses (956) (899) (850) (851) (893) (857) (883) (822) (3,556) (3,455) Restructuring and related charges (18) (12) (51) (10) (9) (5) (10) (5) (91) (29) Underwriting income (loss) $ 719 $ 572 $ 270 $ 550 $ 804 $ 459 $ (61) $ 125 $ 2,111 $ 1,327 Catastrophe losses $ 598 $ 856 $ 993 $ 781 $ 302 $ 481 $ 961 $ 827 $ 3,228 $ 2,571 Operating ratios Loss ratio 65.1 67.8 71.8 68.6 64.7 69.7 76.1 74.2 68.3 71.2 Expense ratio 25.9 25.0 24.7 24.3 24.9 24.3 24.7 24.2 25.0 24.5 Combined ratio 91.0 92.8 96.5 92.9 89.6 94.0 100.8 98.4 93.3 95.7 Effect of catastrophe losses on combined ratio 7.5 10.9 12.7 10.1 3.9 6.2 12.5 10.9 10.3 8.4 Effect of restructuring and related charges on combined ratio 0.2 0.2 0.7 0.1 0.1 0.1 0.1 0.1 0.3 0.1 Effect of amortization of purchased intangible assets on combined ratio - - - - 0.1 0.1 0.1 0.1 - 0.1 Discontinued Lines and Coverages Underwriting Summary Premiums written $ - $ - $ - $ - $ 1 $ 2 $ - $ - $ - $ 3 Premiums earned $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Claims and claims expense (3) (88) (3) (2) (3) (99) (2) (1) (96) (105) Operating costs and expenses (1) - (2) - - (1) - (1) (3) (2) Underwriting loss $ (4) $ (88) $ (5) $ (2) $ (3) $ (100) $ (2) $ (2) $ (99) $ (107) Effect of Discontinued Lines and Coverages on the Property-Liability combined ratio - 1.1 - - 0.1 1.3 - - 0.3 0.3 Allstate Protection Underwriting Income (Loss) by Brand Allstate brand $ 737 $ 562 $ 308 $ 594 $ 798 $ 497 $ (7) $ 169 $ 2,201 $ 1,457 Esurance brand (1) (19) (26) (10) (21) (41) (37) (25) (56) (124) Encompass brand (17) 29 (12) (33) 29 5 (15) (18) (33) 1 Answer Financial - - - (1) (2) (2) (2) (1) (1) (7) Underwriting income (loss) $ 719 $ 572 $ 270 $ 550 $ 804 $ 459 $ (61) $ 125 $ 2,111 $ 1,327 THE ALLSTATE CORPORATION PROPERTY-LIABILITY UNDERWRITING RESULTS BY AREA OF BUSINESS ($ in millions) Three months ended Twelve months ended

24 Average Number Claims and Combined catastrophe Size of catastrophe of events claims expense ratio impact loss per event Greater than $250 million 1 5.0 % $ 347 58.0 % 4.4 $ 347 $101 million to $250 million - - - - - - $50 million to $100 million 2 10.0 158 26.4 2.0 79 Less than $50 million 17 85.0 98 16.4 1.2 6 Total 20 100.0 % 603 100.8 7.6 30 Prior year reserve reestimates (8) (1.3) (0.1) Prior quarter reserve reestimates 3 0.5 - Total catastrophe losses $ 598 100.0 % 7.5 Average Number Claims and Combined catastrophe Size of catastrophe of events claims expense ratio impact loss per event Greater than $250 million 2 1.8 % $ 806 25.0 % 2.6 $ 403 $101 million to $250 million 4 3.6 719 22.3 2.3 180 $50 million to $100 million 8 7.2 574 17.8 1.8 72 Less than $50 million 97 87.4 1,147 35.5 3.7 12 Total 111 100.0 % 3,246 100.6 10.4 29 Prior year reserve reestimates (18) (0.6) (0.1) Total catastrophe losses $ 3,228 100.0 % 10.3 Premiums Total Total Effect on the earned catastrophe catastrophe property and casualty Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year year-to-date losses by year losses by year combined ratio 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 2015 4.0 10.6 3.5 4.7 5.7 30,309 1,719 1,749 5.8 2016 10.9 12.5 6.2 3.9 8.4 30,727 2,571 2,419 7.9 2017 10.1 12.7 10.9 7.5 10.3 31,433 3,228 2,611 8.3 Average 7.2 13.9 8.8 5.3 8.7 7.5 (1) Catastrophe losses and the effect on the combined ratio were updated for 2017 and 2016 to remove Service Businesses from the calculation. The periods 2015 through 2008 include historical Property-Liability results, which include Allstate Protection, Discontinued Lines and Coverages and Service Businesses. The effect on the combined ratio is calculated using the total premiums earned. Effect of all catastrophe losses on the combined ratio THE ALLSTATE CORPORATION PROPERTY-LIABILITY CATASTROPHE EXPERIENCE CATASTROPHE BY SIZE OF EVENT ($ in millions) Three months ended December 31, 2017 EFFECT OF CATASTROPHE LOSSES ON THE COMBINED RATIO (1) Excludes the effect of catastrophe losses relating to earthquakes and hurricanes Twelve months ended December 31, 2017

25 Number of Location Number of Location Number of Location locations (7) Total brand (%) (8) specific (%) (9) locations Total brand (%) specific (%) locations Total brand (%) specific (%) Allstate brand Auto (2)(3)(4) 25 1.2 (10) 5.4 (10) 17 0.4 3.0 23 0.7 3.2 Homeowners (5)(6) 11 0.2 1.5 8 0.5 5.3 3 0.1 2.0 Esurance brand Auto 7 0.6 5.0 16 2.0 5.6 12 1.7 5.6 Homeowners 4 5.1 14.3 - - - - - - Encompass brand Auto 8 1.7 5.7 8 0.8 4.5 11 2.3 7.5 Homeowners 7 0.9 4.5 6 0.9 6.0 9 2.8 8.9 Number of Location Number of Location Number of Location locations Total brand (%) specific (%) locations Total brand (%) specific (%) locations Total brand (%) specific (%) Allstate brand Auto (2)(3)(4) 18 1.7 (10) 5.3 (10) 23 1.3 5.6 25 1.0 7.1 Homeowners (5)(6) 14 1.0 4.2 12 0.5 4.7 10 0.2 4.6 Esurance brand Auto 7 0.7 5.3 13 2.2 6.2 9 0.4 2.3 Homeowners - - - 1 (0.5) (10.0) N/A N/A N/A Encompass brand Auto 5 1.4 7.2 8 3.2 9.9 9 1.6 8.8 Homeowners 3 0.2 3.4 6 0.6 3.3 5 1.4 9.2 (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) THE ALLSTATE CORPORATION ALLSTATE PROTECTION IMPACT OF NET RATE CHANGES APPROVED ON PREMIUMS WRITTEN Three months ended Three months ended Three months ended Allstate brand auto rate changes were 4.0% 4.1%, 4.7%, 7.2%, 7.2% and 7.8% for the trailing twelve months ended December 31, 2017, September 30, 2017, June 30, 2017, March 31, 2017, December 31, 2016 and September 30, 2016, respectively. December 31, 2017 (1) September 30, 2017 June 30, 2017 Three months ended Three months ended Three months ended March 31, 2017 December 31, 2016 September 30, 2016 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 50 states, the District of Columbia and Canadian provinces, rate changes approved for Allstate brand, Esurance brand and Encompass brand for the three month period ending December 31, 2017 are estimated to total $258 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 a location. Impacts of Allstate brand auto effective rate changes as a percentage of total brand prior year-end premiums written were 0.5%, 0.4%, 1.8%, 1.1%, 1.1% and 1.5% for the three months ended December 31, 2017, September 30, 2017, June 30, 2017, March 31, 2017, December 31, 2016 and September 30, 2016, respectively. Rate changes are included in the effective calculations in the period the rate change is effective for renewal contracts. Includes a rate increase in California in first and fourth quarter 2017. Excluding California, Allstate brand auto total brand and location specific rate changes were 1.1% and 4.7%, respectively, in first quarter 2017 and 0.5% and 4.2%, respectively, in fourth quarter 2017. Allstate brand auto rate changes were cumulatively $3.0 billion or 16.5% for 2017, 2016 and 2015. Impacts of Allstate brand homeowners effective rate changes as a percentage of total brand prior year-end premiums written were 0.1%, 0.6%, 0.1%, 0.9%, 0.6% and 0.6% for the three months ended December 31, 2017, September 30, 2017, June 30, 2017, March 31, 2017, December 31, 2016 and September 30, 2016, respectively. Allstate brand homeowner rate changes were cumulatively $387 million or 5.7% in 2017 and 2016. Allstate brand auto and homeowners operates in 50 states, the District of Columbia, and 5 Canadian provinces. Esurance brand auto operates in 43 states and 2 Canadian provinces. Esurance brand homeowners operates in 31 states and 2 Canadian provinces. Encompass brand auto and homeowners operates in 39 states and the District of Columbia. Represents the impact in the states, the District of Columbia and Canadian provinces where rate changes were approved during the period as a percentage of total brand prior year-end premiums written. Represents the impact in the states, the District of Columbia 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.

26 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Net premiums written $ 7,185 $ 7,587 $ 7,337 $ 6,776 $ 6,902 $ 7,379 $ 7,161 $ 6,617 $ 28,885 $ 28,059 Net premiums earned Auto $ 5,003 $ 4,950 $ 4,884 $ 4,839 $ 4,826 $ 4,793 $ 4,745 $ 4,667 $ 19,676 $ 19,031 Homeowners 1,725 1,707 1,691 1,688 1,691 1,683 1,684 1,678 6,811 6,736 Other personal lines 419 414 411 405 403 399 397 393 1,649 1,592 Commercial lines 128 124 118 125 123 127 127 129 495 506 Total 7,275 7,195 7,104 7,057 7,043 7,002 6,953 6,867 28,631 27,865 Incurred losses Auto $ 3,289 $ 3,455 $ 3,442 $ 3,224 $ 3,417 $ 3,610 $ 3,634 $ 3,519 $ 13,410 $ 14,180 Homeowners 1,052 988 1,273 1,194 765 893 1,260 1,190 4,507 4,108 Other personal lines 226 312 258 265 234 236 256 261 1,061 987 Commercial lines 89 103 86 96 109 112 135 119 374 475 Total 4,656 4,858 5,059 4,779 4,525 4,851 5,285 5,089 19,352 19,750 Expenses Auto $ 1,310 $ 1,234 $ 1,228 $ 1,163 $ 1,184 $ 1,140 $ 1,174 $ 1,103 $ 4,935 $ 4,601 Homeowners 421 400 371 387 396 384 373 377 1,579 1,530 Other personal lines 128 120 115 112 117 113 106 103 475 439 Commercial lines 37 36 34 33 34 34 35 38 140 141 Other business lines (1) (14) (15) (11) (11) (11) (17) (13) (12) (51) (53) Total 1,882 1,775 1,737 1,684 1,720 1,654 1,675 1,609 7,078 6,658 Underwriting income (loss) Auto $ 404 $ 261 $ 214 $ 452 $ 225 $ 43 $ (63) $ 45 $ 1,331 $ 250 Homeowners 252 319 47 107 530 406 51 111 725 1,098 Other personal lines 65 (18) 38 28 52 50 35 29 113 166 Commercial lines 2 (15) (2) (4) (20) (19) (43) (28) (19) (110) Other business lines 14 15 11 11 11 17 13 12 51 53 Total 737 562 308 594 798 497 (7) 169 2,201 1,457 Loss ratio 64.0 67.5 71.2 67.7 64.3 69.3 76.0 74.1 67.6 70.9 Expense ratio 25.9 24.7 24.5 23.9 24.4 23.6 24.1 23.4 24.7 23.9 Combined ratio 89.9 92.2 95.7 91.6 88.7 92.9 100.1 97.5 92.3 94.8 Loss ratio 64.0 67.5 71.2 67.7 64.3 69.3 76.0 74.1 67.6 70.9 Less: effect of catastrophe losses 7.4 11.5 12.9 10.0 4.1 6.3 13.1 11.4 10.4 8.7 effect of prior year non-catastrophe reserve reestimates (2.3) (3.0) (1.1) (1.5) (1.6) - (0.2) 0.2 (2.0) (0.4) Underlying loss ratio * 58.9 59.0 59.4 59.2 61.8 63.0 63.1 62.5 59.2 62.6 Expense ratio 25.9 24.7 24.5 23.9 24.4 23.6 24.1 23.4 24.7 23.9 Less: effect of amortization of purchased intangible assets - - - - - - - - - - Expense ratio, excluding the effect of amortization of purchased intangible assets 25.9 24.7 24.5 23.9 24.4 23.6 24.1 23.4 24.7 23.9 Reconciliation of combined ratio to underlying combined ratio Combined ratio 89.9 92.2 95.7 91.6 88.7 92.9 100.1 97.5 92.3 94.8 Effect of catastrophe losses (7.4) (11.5) (12.9) (10.0) (4.1) (6.3) (13.1) (11.4) (10.4) (8.7) Effect of prior year non-catastrophe reserve reestimates 2.3 3.0 1.1 1.5 1.6 - 0.2 (0.2) 2.0 0.4 Effect of amortization of purchased intangible assets - - - - - - - - - - Underlying combined ratio * 84.8 83.7 83.9 83.1 86.2 86.6 87.2 85.9 83.9 86.5 Effect of prior year reserve reestimates on combined ratio (2.4) (3.1) (1.2) (1.5) (1.7) - - 0.2 (2.0) (0.4) Effect of advertising expenses on combined ratio 2.0 2.1 1.9 2.0 2.4 2.2 2.3 1.6 2.0 2.1 (1) Other business lines primarily include Ivantage and represents commissions earned and other costs and expenses. THE ALLSTATE CORPORATION ALLSTATE BRAND PROFITABILITY MEASURES ($ in millions) Three months ended Twelve months ended

27 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 New Issued Applications (in thousands) (2) Auto (3) 620 651 639 610 562 584 582 584 2,520 2,312 Homeowners (4) 177 198 195 163 167 188 193 164 733 712 Average Premium - Gross Written ($) (5) Auto 561 556 544 538 537 532 516 507 550 523 Homeowners 1,206 1,203 1,192 1,187 1,181 1,181 1,171 1,174 1,197 1,177 Average Premium - Net Earned ($) (6) Auto 512 507 499 492 487 479 471 461 503 474 Homeowners 1,131 1,119 1,106 1,106 1,105 1,099 1,090 1,082 1,115 1,094 Annualized Average Premium ($) (7) Auto 1,022 1,015 999 989 978 966 946 927 1,005 964 Homeowners 1,133 1,125 1,117 1,112 1,109 1,102 1,098 1,091 1,119 1,104 Average Underlying Loss (Incurred Pure Premium) and Expense * ($) (8) Auto 963 925 925 899 941 927 926 889 927 930 Homeowners 679 689 668 682 655 673 643 648 677 657 Renewal Ratio (%) (9) Auto (10) 87.8 87.7 87.4 87.4 87.4 87.5 88.0 88.0 87.6 87.8 Homeowners (11) 87.5 87.5 87.0 87.1 87.5 87.9 87.8 88.1 87.3 87.8 Auto Claim Frequency (12) (% change year-over-year) Bodily Injury Gross (2.9) (5.6) (4.7) (6.0) (2.0) 0.3 2.8 1.1 (4.8) 0.5 Bodily Injury Paid (13) (13.2) (9.1) (23.7) (20.5) (19.2) (19.6) 1.5 5.9 (17.4) (7.9) Property Damage Gross (4.1) (8.0) (5.2) (3.9) 1.2 3.9 5.6 2.1 (5.3) 3.1 Property Damage Paid (14) (5.2) (9.0) (3.4) (3.2) (1.2) 0.1 (0.1) 2.4 (5.2) 0.3 Auto Paid Claim Severity (15) (% change year-over-year) Bodily injury (13) 17.6 15.0 28.3 25.1 18.8 12.4 (2.3) (5.5) 22.0 4.7 Property damage 6.7 4.9 1.6 4.8 1.9 1.9 5.3 7.5 4.5 4.1 Homeowners Excluding Catastrophe Losses (% change year-over-year) Gross Claim frequency (12) (2.9) (2.6) 6.0 7.6 2.2 5.2 (12.5) (7.7) 1.9 (3.4) Paid Claim frequency (12) (3.7) (5.4) 7.1 2.3 (0.5) 0.7 (14.3) (2.0) (0.1) (4.3) Paid Claim severity 8.1 8.1 (0.2) 4.1 1.8 (0.5) 4.7 (2.7) 5.0 0.9 (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) Of our largest 10 states, 5 and 1 experienced increases in the renewal ratio in the fourth quarter and the twelve months of 2017, respectively, compared to the same periods of 2016. Paid claim frequency is calculated as annualized notice counts closed with payment in the period divided by the average of policies in force with the applicable coverage during the period. Gross claim frequency is calculated as annualized notice counts received in the period divided by the average of policies in force with the applicable coverage during the period. Gross claim frequency includes all actual notice counts, regardless of their current status (open or closed) or their ultimate disposition (closed with a payment or closed without payment). Frequency statistics exclude counts associated with catastrophe events. The percent change in paid or gross claim frequency is calculated as the amount of increase or decrease in the paid or gross claim frequency in the current period compared to the same period in the prior year; divided by the prior year paid or gross claim frequency. Bodily injury claim process changes in the second half of 2016 related to enhanced documentation of injuries and related medical treatments are having a related impact on paid claim frequency and severity due to payment mix and claim closure patterns. These process changes are beginning to normalize and the related impacts on the percent change in paid claim frequency and severity have begun to moderate. 42 states experienced a year over year decrease in property damage paid claim frequency in fourth quarter 2017 compared to fourth quarter 2016. Paid claim severity is calculated by dividing the sum of paid losses and loss expenses by claims closed with a payment during the period. The percent change in paid claim severity is calculated as the amount of increase or decrease in paid claim severity in the current period compared to the same period in the prior year; divided by the prior year paid claims severity. THE ALLSTATE CORPORATION ALLSTATE BRAND STATISTICS (1) Three months ended Twelve months ended 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. 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. 28 and 20 states in the fourth quarter and the twelve months of 2017, respectively, including 7 and 3 of our largest 10 states, experienced increases in the renewal ratio compared to the same periods of 2016. Statistics presented for Allstate brand exclude excess and surplus lines. 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. Allstate brand includes automobiles added by existing customers when they exceed the number allowed (currently 10) on a policy. 36 states, including 10 of our 10 largest states, experienced increases in new issued applications in the fourth quarter of 2017 compared to the same period of 2016. 38 states, including 9 of our 10 largest states, experienced increases in new issued applications in 2017 compared to 2016, with 20 states experiencing double digit increases. Of our largest 10 states, 5 and 6 experienced increases in new issued applications in the fourth quarter and the twelve months of 2017, respectively, compared to the same periods of 2016. 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. Calculated by annualizing net earned premium reported in the quarter and year-to-date divided by policies in force at quarter end. Average underlying loss (incurred pure premium) and expense is calculated as the underlying combined ratio multiplied by the annualized average premium.

28 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Change in auto claim frequency (2) (% change in frequency rate year over year) % Change in gross claim frequency -2.9% 1.2% -1.8% -3.1% -2.4% -1.1% 0.8% -1.7% -0.3% -2.8% -1.3% 4.0% 6.8% 6.8% 6.4% 3.9% 1.1% 2.8% 0.3% -2.0% -6.0% -4.7% -5.6% -2.9% % Change in paid claim frequency (3) -0.2% 1.1% -1.0% 0.7% -2.3% -2.7% -2.1% -4.7% -4.7% -3.8% 0.2% 4.7% 2.3% 6.0% 3.5% 0.0% 5.9% 1.5% -19.6% -19.2% -20.5% -23.7% -9.1% -13.2% (1) (2) (3) Bodily injury claim process changes in the second half of 2016 related to enhanced documentation of injuries and related medical treatments are having a related impact on paid claim frequency and severity due to payment mix and claim closure patterns. These process changes are beginning to normalize and the related impacts on the percent change in paid claim frequency and severity have begun to moderate. Paid claim frequency is calculated as annualized notice counts closed with payment in the period divided by the average of policies in force with the applicable coverage during the period. Gross claim frequency is calculated as annualized notice counts received in the period divided by the average of policies in force with the applicable coverage during the period. Gross claim frequency includes all actual notice counts, regardless of their current status (open or closed) or their ultimate disposition (closed with a payment or closed without payment). The percent change in paid or gross claim frequency is calculated as the amount of increase or decrease in the paid or gross claim frequency in the current period compared to the same period in the prior year; divided by the prior year paid or gross claim frequency. Frequency statistics exclude counts associated with catastrophe events. THE ALLSTATE CORPORATION ALLSTATE BRAND AUTO CLAIM FREQUENCY ANALYSIS (1) BODILY INJURY % CHANGE IN GROSS AND PAID CLAIM FREQUENCY RATE 2012 2013 2014 2015 2016 2017 -28.0% -24.0% -20.0% -16.0% -12.0% -8.0% -4.0% 0.0% 4.0% 8.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2012 2013 2014 2015 2016 2017 % c ha ng e ye ar -o ve r- ye ar Rates of change in auto bodily injury frequency % change in gross claim frequency % change in paid claim frequency

29 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Change in auto claim frequency (2) (% change in frequency rate year over year) % Change in gross claim frequency -4.8% 0.7% -1.8% -4.3% -0.7% -0.3% 0.6% 1.4% 5.1% -2.4% -1.0% 0.5% 2.1% 6.9% 8.9% 7.5% 2.1% 5.6% 3.9% 1.2% -3.9% -5.2% -8.0% -4.1% % Change in paid claim frequency -4.3% -0.3% -3.4% -4.1% -4.5% 0.5% 3.7% 0.8% 2.9% -0.4% 0.4% 2.5% 2.5% 4.2% 4.7% 3.7% 2.4% -0.1% 0.1% -1.2% -3.2% -3.4% -9.0% -5.2% (1) (2) Paid claim frequency is calculated as annualized notice counts closed with payment in the period divided by the average of policies in force with the applicable coverage during the period. Gross claim frequency is calculated as annualized notice counts received in the period divided by the average of policies in force with the applicable coverage during the period. Gross claim frequency includes all actual notice counts, regardless of their current status (open or closed) or their ultimate disposition (closed with a payment or closed without payment). The percent change in paid or gross claim frequency is calculated as the amount of increase or decrease in the paid or gross claim frequency in the current period compared to the same period in the prior year; divided by the prior year paid or gross claim frequency. Frequency statistics exclude counts associated with catastrophe events. THE ALLSTATE CORPORATION ALLSTATE BRAND AUTO CLAIM FREQUENCY ANALYSIS (1) PROPERTY DAMAGE % CHANGE IN GROSS AND PAID CLAIM FREQUENCY 2012 2013 2014 2015 2016 2017 -10.0% -8.0% -6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2012 2013 2014 2015 2016 2017 % c ha ng e ye ar -o ve r- ye ar Rates of change in auto property damage frequency % change in gross claim frequency % change in paid claim frequency

30 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Net premiums written $ 410 $ 453 $ 408 $ 457 $ 399 $ 446 $ 392 $ 452 $ 1,728 $ 1,689 Net premiums earned Auto $ 411 $ 411 $ 411 $ 403 $ 408 $ 405 $ 403 $ 394 $ 1,636 $ 1,610 Homeowners 19 19 16 14 13 11 10 8 68 42 Other personal lines 2 2 2 2 2 2 2 2 8 8 Total 432 432 429 419 423 418 415 404 1,712 1,660 Incurred losses Auto $ 322 $ 322 $ 324 $ 300 $ 310 $ 313 $ 308 $ 289 $ 1,268 $ 1,220 Homeowners 9 14 21 13 8 11 10 4 57 33 Other personal lines 1 1 1 1 1 2 1 1 4 5 Total 332 337 346 314 319 326 319 294 1,329 1,258 Expenses Auto $ 94 $ 104 $ 100 $ 107 $ 114 $ 111 $ 107 $ 123 $ 405 $ 455 Homeowners 6 9 8 8 10 22 25 11 31 68 Other personal lines 1 1 1 - 1 - 1 1 3 3 Total 101 114 109 115 125 133 133 135 439 526 Underwriting (loss) income Auto $ (5) $ (15) $ (13) $ (4) $ (16) $ (19) $ (12) $ (18) $ (37) $ (65) Homeowners 4 (4) (13) (7) (5) (22) (25) (7) (20) (59) Other personal lines - - - 1 - - - - 1 - Total (1) (19) (26) (10) (21) (41) (37) (25) (56) (124) Loss ratio 76.8 78.0 80.7 74.9 75.4 78.0 76.9 72.8 77.6 75.8 Expense ratio 23.4 26.4 25.4 27.5 29.6 31.8 32.0 33.4 25.7 31.7 Combined ratio 100.2 104.4 106.1 102.4 105.0 109.8 108.9 106.2 103.3 107.5 Loss ratio 76.8 78.0 80.7 74.9 75.4 78.0 76.9 72.8 77.6 75.8 Less: effect of catastrophe losses 0.2 3.9 5.6 1.9 1.2 3.3 3.4 0.7 2.9 2.2 effect of prior year non-catastrophe reserve reestimates - (0.2) - - (2.1) (1.0) (1.0) (1.0) - (1.3) Underlying loss ratio * 76.6 74.3 75.1 73.0 76.3 75.7 74.5 73.1 74.7 74.9 Expense ratio 23.4 26.4 25.4 27.5 29.6 31.8 32.0 33.4 25.7 31.7 Less: effect of amortization of purchased intangible assets 0.2 0.2 - 0.3 0.9 1.5 1.7 1.5 0.2 1.4 Expense ratio, excluding the effect of amortization of purchased intangible assets 23.2 26.2 25.4 27.2 28.7 30.3 30.3 31.9 25.5 30.3 Reconciliation of combined ratio to underlying combined ratio Combined ratio 100.2 104.4 106.1 102.4 105.0 109.8 108.9 106.2 103.3 107.5 Effect of catastrophe losses (0.2) (3.9) (5.6) (1.9) (1.2) (3.3) (3.4) (0.7) (2.9) (2.2) Effect of prior year non-catastrophe reserve reestimates - 0.2 - - 2.1 1.0 1.0 1.0 - 1.3 Effect of amortization of purchased intangible assets (0.2) (0.2) - (0.3) (0.9) (1.5) (1.7) (1.5) (0.2) (1.4) Underlying combined ratio * 99.8 100.5 100.5 100.2 105.0 106.0 104.8 105.0 100.2 105.2 Effect of prior year reserve reestimates on combined ratio - (0.2) (0.2) - (2.1) (1.0) (1.0) (1.0) (0.1) (1.3) Effect of advertising expenses on combined ratio 6.7 9.3 8.6 8.6 9.2 11.7 12.2 11.6 8.3 11.2 Policies in Force (in thousands) Auto 1,352 1,369 1,388 1,400 1,391 1,395 1,409 1,428 1,352 1,391 Homeowners 79 76 69 63 58 52 44 37 79 58 Other personal lines 44 45 47 48 47 47 47 46 44 47 1,475 1,490 1,504 1,511 1,496 1,494 1,500 1,511 1,475 1,496 New Issued Applications (in thousands) Auto 105 116 120 143 137 151 141 168 484 597 Homeowners 7 10 9 8 9 10 11 7 34 37 Other personal lines 6 6 7 8 8 9 8 10 27 35 118 132 136 159 154 170 160 185 545 669 Average Premium - Gross Written ($) Auto 586 574 564 571 555 546 538 547 574 547 Homeowners 901 924 910 919 861 872 855 891 917 875 Renewal Ratio (%) Auto 82.2 81.8 81.9 80.4 79.3 78.9 80.0 79.6 81.5 79.4 Homeowners 85.7 85.8 86.1 83.5 82.9 83.1 83.9 81.6 85.5 82.6 THE ALLSTATE CORPORATION ESURANCE PROFITABILITY MEASURES AND STATISTICS ($ in millions) Three months ended Twelve months ended

31 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Net premiums written $ 243 $ 271 $ 285 $ 236 $ 263 $ 299 $ 315 $ 263 $ 1,035 $ 1,140 Net premiums earned Auto $ 137 $ 140 $ 143 $ 146 $ 151 $ 155 $ 158 $ 159 $ 566 $ 623 Homeowners 104 106 108 113 115 119 121 124 431 479 Other personal lines 23 23 23 24 24 25 25 26 93 100 Total 264 269 274 283 290 299 304 309 1,090 1,202 Incurred losses Auto $ 88 $ 91 $ 105 $ 104 $ 104 $ 117 $ 130 $ 123 $ 388 $ 474 Homeowners 100 54 84 108 60 74 85 85 346 304 Other personal lines 11 13 10 21 13 17 16 31 55 77 Total 199 158 199 233 177 208 231 239 789 855 Expenses Auto $ 42 $ 43 $ 46 $ 43 $ 44 $ 44 $ 45 $ 45 $ 174 $ 178 Homeowners 33 32 34 33 33 34 36 36 132 139 Other personal lines 7 7 7 7 7 8 7 7 28 29 Total 82 82 87 83 84 86 88 88 334 346 Underwriting (loss) income Auto $ 7 $ 6 $ (8) $ (1) $ 3 $ (6) $ (17) $ (9) $ 4 $ (29) Homeowners (29) 20 (10) (28) 22 11 - 3 (47) 36 Other personal lines 5 3 6 (4) 4 - 2 (12) 10 (6) Total (17) 29 (12) (33) 29 5 (15) (18) (33) 1 Loss ratio 75.4 58.7 72.6 82.4 61.0 69.6 76.0 77.3 72.4 71.1 Expense ratio 31.0 30.5 31.8 29.3 29.0 28.7 28.9 28.5 30.6 28.8 Combined ratio 106.4 89.2 104.4 111.7 90.0 98.3 104.9 105.8 103.0 99.9 Loss ratio 75.4 58.7 72.6 82.4 61.0 69.6 76.0 77.3 72.4 71.1 Less: effect of catastrophe losses 23.4 4.5 19.0 23.7 3.1 9.0 11.2 13.3 17.7 9.2 effect of prior year non-catastrophe reserve reestimates (3.4) (0.8) (2.2) 1.4 (3.8) - 0.9 4.2 (1.2) 0.4 Underlying loss ratio * 55.4 55.0 55.8 57.3 61.7 60.6 63.9 59.8 55.9 61.5 Expense ratio 31.0 30.5 31.8 29.3 29.0 28.7 28.9 28.5 30.6 28.8 Less: effect of amortization of purchased intangible assets - - - - - - - - - - Expense ratio, excluding the effect of amortization of purchased intangible assets 31.0 30.5 31.8 29.3 29.0 28.7 28.9 28.5 30.6 28.8 Reconciliation of combined ratio to underlying combined ratio Combined ratio 106.4 89.2 104.4 111.7 90.0 98.3 104.9 105.8 103.0 99.9 Effect of catastrophe losses (23.4) (4.5) (19.0) (23.7) (3.1) (9.0) (11.2) (13.3) (17.7) (9.2) Effect of prior year non-catastrophe reserve reestimates 3.4 0.8 2.2 (1.4) 3.8 - (0.9) (4.2) 1.2 (0.4) Underlying combined ratio * 86.4 85.5 87.6 86.6 90.7 89.3 92.8 88.3 86.5 90.3 Effect of prior year reserve reestimates on combined ratio (3.8) (0.8) (2.9) 2.1 (3.8) 0.3 0.3 4.5 (1.3) 0.4 Effect of advertising expenses on combined ratio 0.4 0.4 - - 0.3 - 0.3 - 0.2 0.2 Policies in Force (in thousands) Auto 530 548 571 595 622 649 676 701 530 622 Homeowners 254 262 273 284 295 305 318 329 254 295 Other personal lines 85 88 91 94 98 101 105 108 85 98 869 898 935 973 1,015 1,055 1,099 1,138 869 1,015 New Issued Applications (in thousands) Auto 14 13 13 12 11 13 15 15 52 54 Homeowners 7 8 8 7 7 9 9 9 30 34 Average Premium - Gross Written ($) Auto 1,111 1,087 1,065 1,057 1,043 1,022 988 981 1,079 1,008 Homeowners 1,706 1,703 1,667 1,659 1,650 1,659 1,629 1,618 1,684 1,639 Renewal Ratio (%) Auto 72.6 72.0 74.2 73.1 73.1 73.1 75.5 76.1 73.0 74.4 Homeowners 77.6 77.7 78.7 78.2 78.3 77.9 79.9 81.5 78.1 79.4 THE ALLSTATE CORPORATION ENCOMPASS BRAND PROFITABILITY MEASURES AND STATISTICS ($ in millions) Three months ended Twelve months ended

32 Allstate Esurance Encompass Allstate brand brand brand Protection (1) Net premiums written $ 28,885 $ 1,728 $ 1,035 $ 31,648 Net premiums earned $ 28,631 $ 1,712 $ 1,090 $ 31,433 Incurred losses (19,352) (1,329) (789) (21,470) Expenses (7,078) (439) (334) (7,852) Underwriting income (loss) $ 2,201 $ (56) $ (33) $ 2,111 Loss ratio 67.6 77.6 72.4 68.3 Expense ratio 24.7 25.7 30.6 25.0 Reconciliation of combined ratio to underlying combined ratio Combined ratio 92.3 103.3 103.0 93.3 Effect of catastrophe losses (10.4) (2.9) (17.7) (10.3) Effect of prior year non-catastrophe reserve reestimates 2.0 - 1.2 1.8 Effect of amortization of purchased intangible assets - (0.2) - - Underlying combined ratio * 83.9 100.2 86.5 84.8 Allstate Esurance Encompass Allstate brand brand brand Protection (1) Net premiums written $ 28,059 $ 1,689 $ 1,140 $ 30,888 Net premiums earned $ 27,865 $ 1,660 $ 1,202 $ 30,727 Incurred losses (19,750) (1,258) (855) (21,863) Expenses (6,658) (526) (346) (7,537) Underwriting income (loss) $ 1,457 $ (124) $ 1 $ 1,327 Loss ratio 70.9 75.8 71.1 71.2 Expense ratio 23.9 31.7 28.8 24.5 Reconciliation of combined ratio to underlying combined ratio Combined ratio 94.8 107.5 99.9 95.7 Effect of catastrophe losses (8.7) (2.2) (9.2) (8.4) Effect of prior year non-catastrophe reserve reestimates 0.4 1.3 (0.4) 0.4 Effect of amortization of purchased intangible assets - (1.4) - (0.1) Underlying combined ratio * 86.5 105.2 90.3 87.6 Allstate Esurance Encompass Allstate brand brand brand Protection (1) Net premiums written $ 27,258 $ 1,613 $ 1,244 $ 30,115 Net premiums earned $ 26,891 $ 1,588 $ 1,269 $ 29,748 Incurred losses (18,593) (1,192) (933) (20,718) Expenses (6,479) (560) (362) (7,409) Underwriting income (loss) $ 1,819 $ (164) $ (26) $ 1,621 Loss ratio 69.1 75.1 73.5 69.7 Expense ratio 24.1 35.2 28.5 24.9 Reconciliation of combined ratio to underlying combined ratio Combined ratio 93.2 110.3 102.0 94.6 Effect of catastrophe losses (5.9) (0.9) (8.7) (5.8) Effect of prior year non-catastrophe reserve reestimates (0.2) 1.2 (0.7) (0.1) Effect of amortization of purchased intangible assets - (2.2) - (0.2) Underlying combined ratio * 87.1 108.4 92.6 88.5 (1) Includes Answer Financial underwriting loss of $1 million, $7 million and $8 million in 2017, 2016 and 2015, respectively. THE ALLSTATE CORPORATION For the twelve months ended December 31, 2016 For the twelve months ended December 31, 2015 ($ in millions) HISTORICAL UNDERWRITING RESULTS BY AREA OF BUSINESS For the twelve months ended December 31, 2017

33 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Allstate brand auto Net premiums written $ 4,956 $ 5,096 $ 4,925 $ 4,882 $ 4,756 $ 4,940 $ 4,767 $ 4,746 $ 19,859 $ 19,209 Net premiums earned $ 5,003 $ 4,950 $ 4,884 $ 4,839 $ 4,826 $ 4,793 $ 4,745 $ 4,667 $ 19,676 $ 19,031 Incurred losses (3,289) (3,455) (3,442) (3,224) (3,417) (3,610) (3,634) (3,519) (13,410) (14,180) Expenses (1,310) (1,234) (1,228) (1,163) (1,184) (1,140) (1,174) (1,103) (4,935) (4,601) Underwriting income (loss) $ 404 $ 261 $ 214 $ 452 $ 225 $ 43 $ (63) $ 45 $ 1,331 $ 250 Loss ratio 65.7 69.8 70.5 66.6 70.8 75.3 76.6 75.4 68.1 74.5 Less: effect of catastrophe losses 0.7 7.3 4.2 1.4 1.2 3.1 4.1 2.9 3.4 2.8 effect of prior year non-catastrophe reserve reestimates (3.0) (3.7) (1.2) (1.6) (2.1) - (0.7) 0.2 (2.4) (0.6) Underlying loss ratio * 68.0 66.2 67.5 66.8 71.7 72.2 73.2 72.3 67.1 72.3 Expense ratio 26.2 24.9 25.1 24.1 24.5 23.8 24.7 23.6 25.1 24.2 Combined ratio 91.9 94.7 95.6 90.7 95.3 99.1 101.3 99.0 93.2 98.7 Effect of catastrophe losses (0.7) (7.3) (4.2) (1.4) (1.2) (3.1) (4.1) (2.9) (3.4) (2.8) Effect of prior year non-catastrophe reserve reestimates 3.0 3.7 1.2 1.6 2.1 - 0.7 (0.2) 2.4 0.6 Underlying combined ratio * 94.2 91.1 92.6 90.9 96.2 96.0 97.9 95.9 92.2 96.5 Esurance brand auto Net premiums written $ 389 $ 427 $ 386 $ 439 $ 382 $ 428 $ 376 $ 439 $ 1,641 $ 1,625 Net premiums earned $ 411 $ 411 $ 411 $ 403 $ 408 $ 405 $ 403 $ 394 $ 1,636 $ 1,610 Incurred losses (322) (322) (324) (300) (310) (313) (308) (289) (1,268) (1,220) Expenses (94) (104) (100) (107) (114) (111) (107) (123) (405) (455) Underwriting (loss) income $ (5) $ (15) $ (13) $ (4) $ (16) $ (19) $ (12) $ (18) $ (37) $ (65) Loss ratio 78.3 78.3 78.9 74.4 76.0 77.3 76.4 73.4 77.5 75.8 Less: effect of catastrophe losses - 3.6 3.6 1.0 1.0 2.2 2.2 0.5 2.1 1.5 effect of prior year non-catastrophe reserve reestimates - - 0.3 - (2.2) (1.0) (1.0) (1.0) 0.1 (1.3) Underlying loss ratio * 78.3 74.7 75.0 73.4 77.2 76.1 75.2 73.9 75.3 75.6 Expense ratio 22.9 25.3 24.3 26.6 27.9 27.4 26.6 31.2 24.8 28.2 Combined ratio 101.2 103.6 103.2 101.0 103.9 104.7 103.0 104.6 102.3 104.0 Effect of catastrophe losses - (3.6) (3.6) (1.0) (1.0) (2.2) (2.2) (0.5) (2.1) (1.5) Effect of prior year non-catastrophe reserve reestimates - - (0.3) - 2.2 1.0 1.0 1.0 (0.1) 1.3 Effect of amortization of purchased intangible assets (0.2) (0.2) - (0.2) (0.9) (1.5) (1.8) (1.5) (0.2) (1.4) Underlying combined ratio * 101.0 99.8 99.3 99.8 104.2 102.0 100.0 103.6 99.9 102.4 Encompass brand auto Net premiums written $ 128 $ 141 $ 148 $ 125 $ 138 $ 153 $ 162 $ 138 $ 542 $ 591 Net premiums earned $ 137 $ 140 $ 143 $ 146 $ 151 $ 155 $ 158 $ 159 $ 566 $ 623 Incurred losses (88) (91) (105) (104) (104) (117) (130) (123) (388) (474) Expenses (42) (43) (46) (43) (44) (44) (45) (45) (174) (178) Underwriting income (loss) $ 7 $ 6 $ (8) $ (1) $ 3 $ (6) $ (17) $ (9) $ 4 $ (29) Loss ratio 64.2 65.0 73.4 71.2 68.9 75.5 82.3 77.4 68.6 76.1 Less: effect of catastrophe losses - 0.7 4.9 2.8 - 3.3 1.9 1.3 2.1 1.6 effect of prior year non-catastrophe reserve reestimates (3.6) - - - (2.7) (1.3) 3.8 1.3 (0.9) 0.4 Underlying loss ratio * 67.8 64.3 68.5 68.4 71.6 73.5 76.6 74.8 67.4 74.1 Expense ratio 30.7 30.7 32.2 29.5 29.1 28.4 28.5 28.3 30.7 28.6 Combined ratio 94.9 95.7 105.6 100.7 98.0 103.9 110.8 105.7 99.3 104.7 Effect of catastrophe losses - (0.7) (4.9) (2.8) - (3.3) (1.9) (1.3) (2.1) (1.6) Effect of prior year non-catastrophe reserve reestimates 3.6 - - - 2.7 1.3 (3.8) (1.3) 0.9 (0.4) Underlying combined ratio * 98.5 95.0 100.7 97.9 100.7 101.9 105.1 103.1 98.1 102.7 THE ALLSTATE CORPORATION AUTO PROFITABILITY MEASURES BY BRAND Twelve months ended ($ in millions) Three months ended

34 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Allstate brand homeowners Net premiums written $ 1,694 $ 1,921 $ 1,847 $ 1,403 $ 1,638 $ 1,869 $ 1,831 $ 1,392 $ 6,865 $ 6,730 Net premiums earned $ 1,725 $ 1,707 $ 1,691 $ 1,688 $ 1,691 $ 1,683 $ 1,684 $ 1,678 $ 6,811 $ 6,736 Incurred losses (1,052) (988) (1,273) (1,194) (765) (893) (1,260) (1,190) (4,507) (4,108) Expenses (421) (400) (371) (387) (396) (384) (373) (377) (1,579) (1,530) Underwriting income (loss) $ 252 $ 319 $ 47 $ 107 $ 530 $ 406 $ 51 $ 111 $ 725 $ 1,098 Loss ratio 61.0 57.9 75.3 70.8 45.3 53.1 74.8 70.9 66.2 61.0 Less: effect of catastrophe losses 27.8 22.4 38.4 34.1 10.8 15.4 38.3 34.2 30.7 24.6 effect of prior year non-catastrophe reserve reestimates (2.3) (2.3) (1.0) (1.7) (1.2) (0.6) 0.1 (0.2) (1.8) (0.4) Underlying loss ratio * 35.5 37.8 37.9 38.4 35.7 38.3 36.4 36.9 37.3 36.8 Expense ratio 24.4 23.4 21.9 22.9 23.4 22.8 22.2 22.5 23.2 22.7 Combined ratio 85.4 81.3 97.2 93.7 68.7 75.9 97.0 93.4 89.4 83.7 Effect of catastrophe losses (27.8) (22.4) (38.4) (34.1) (10.8) (15.4) (38.3) (34.2) (30.7) (24.6) Effect of prior year non-catastrophe reserve reestimates 2.3 2.3 1.0 1.7 1.2 0.6 (0.1) 0.2 1.8 0.4 Underlying combined ratio * 59.9 61.2 59.8 61.3 59.1 61.1 58.6 59.4 60.5 59.5 Esurance brand homeowners Net premiums written $ 19 $ 24 $ 20 $ 16 $ 15 $ 16 $ 14 $ 11 $ 79 $ 56 Net premiums earned $ 19 $ 19 $ 16 $ 14 $ 13 $ 11 $ 10 $ 8 $ 68 $ 42 Incurred losses (9) (14) (21) (13) (8) (11) (10) (4) (57) (33) Expenses (6) (9) (8) (8) (10) (22) (25) (11) (31) (68) Underwriting income (loss) $ 4 $ (4) $ (13) $ (7) $ (5) $ (22) $ (25) $ (7) $ (20) $ (59) Loss ratio 47.3 73.7 131.3 92.9 61.6 100.0 100.0 50.0 83.8 78.6 Less: effect of catastrophe losses 5.2 10.5 56.3 28.6 7.7 45.5 50.0 12.5 23.5 28.6 effect of prior year non-catastrophe reserve reestimates - (5.2) - - - - - - (1.5) - Underlying loss ratio * 42.1 68.4 75.0 64.3 53.9 54.5 50.0 37.5 61.8 50.0 Expense ratio 31.6 47.4 50.0 57.1 76.9 200.0 250.0 137.5 45.6 161.9 Combined ratio 78.9 121.1 181.3 150.0 138.5 300.0 350.0 187.5 129.4 240.5 Effect of catastrophe losses (5.2) (10.5) (56.3) (28.6) (7.7) (45.5) (50.0) (12.5) (23.5) (28.6) Effect of prior year non-catastrophe reserve reestimates - 5.2 - - - - - - 1.5 - Underlying combined ratio * 73.7 115.8 125.0 121.4 130.8 254.5 300.0 175.0 107.4 211.9 Encompass brand homeowners Net premiums written $ 95 $ 108 $ 112 $ 91 $ 103 $ 121 $ 126 $ 104 $ 406 $ 454 Net premiums earned $ 104 $ 106 $ 108 $ 113 $ 115 $ 119 $ 121 $ 124 $ 431 $ 479 Incurred losses (100) (54) (84) (108) (60) (74) (85) (85) (346) (304) Expenses (33) (32) (34) (33) (33) (34) (36) (36) (132) (139) Underwriting (loss) income $ (29) $ 20 $ (10) $ (28) $ 22 $ 11 $ - $ 3 $ (47) $ 36 Loss ratio 96.2 50.9 77.8 95.6 52.2 62.2 70.2 68.6 80.3 63.5 Less: effect of catastrophe losses 56.7 10.3 38.9 54.0 7.8 17.6 24.0 30.7 40.1 20.3 effect of prior year non-catastrophe reserve reestimates 1.0 - - 0.9 (2.6) 0.9 0.8 (0.8) 0.5 (0.5) Underlying loss ratio * 38.5 40.6 38.9 40.7 47.0 43.7 45.4 38.7 39.7 43.7 Expense ratio 31.7 30.2 31.5 29.2 28.7 28.6 29.8 29.0 30.6 29.0 Combined ratio 127.9 81.1 109.3 124.8 80.9 90.8 100.0 97.6 110.9 92.5 Effect of catastrophe losses (56.7) (10.3) (38.9) (54.0) (7.8) (17.6) (24.0) (30.7) (40.1) (20.3) Effect of prior year non-catastrophe reserve reestimates (1.0) - - (0.9) 2.6 (0.9) (0.8) 0.8 (0.5) 0.5 Underlying combined ratio * 70.2 70.8 70.4 69.9 75.7 72.3 75.2 67.7 70.3 72.7 THE ALLSTATE CORPORATION HOMEOWNERS PROFITABILITY MEASURES BY BRAND ($ in millions) Three months ended Twelve months ended

35 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Allstate brand other personal lines Net premiums written $ 410 $ 454 $ 441 $ 368 $ 393 $ 447 $ 428 $ 353 $ 1,673 $ 1,621 Net premiums earned $ 419 $ 414 $ 411 $ 405 $ 403 $ 399 $ 397 $ 393 $ 1,649 $ 1,592 Incurred losses (226) (312) (258) (265) (234) (236) (256) (261) (1,061) (987) Expenses (128) (120) (115) (112) (117) (113) (106) (103) (475) (439) Underwriting income (loss) $ 65 $ (18) $ 38 $ 28 $ 52 $ 50 $ 35 $ 29 $ 113 $ 166 Loss ratio 53.9 75.3 62.8 65.4 58.1 59.2 64.5 66.4 64.3 62.0 Less: effect of catastrophe losses 4.8 15.7 13.9 14.6 9.7 6.0 15.6 16.0 12.2 11.8 effect of prior year non-catastrophe reserve reestimates 1.9 0.7 (0.2) (0.3) 0.7 (0.5) (1.7) (1.5) 0.5 (0.7) Underlying loss ratio * 47.2 58.9 49.1 51.1 47.7 53.7 50.6 51.9 51.6 50.9 Expense ratio 30.6 29.0 28.0 27.7 29.0 28.3 26.7 26.2 28.8 27.6 Combined ratio 84.5 104.3 90.8 93.1 87.1 87.5 91.2 92.6 93.1 89.6 Effect of catastrophe losses (4.8) (15.7) (13.9) (14.6) (9.7) (6.0) (15.6) (16.0) (12.2) (11.8) Effect of prior year non-catastrophe reserve reestimates (1.9) (0.7) 0.2 0.3 (0.7) 0.5 1.7 1.5 (0.5) 0.7 Underlying combined ratio * 77.8 87.9 77.1 78.8 76.7 82.0 77.3 78.1 80.4 78.5 Esurance brand other personal lines Net premiums written $ 2 $ 2 $ 2 $ 2 $ 2 $ 2 $ 2 $ 2 $ 8 $ 8 Net premiums earned $ 2 $ 2 $ 2 $ 2 $ 2 $ 2 $ 2 $ 2 $ 8 $ 8 Incurred losses (1) (1) (1) (1) (1) (2) (1) (1) (4) (5) Expenses (1) (1) (1) - (1) - (1) (1) (3) (3) Underwriting income (loss) $ - $ - $ - $ 1 $ - $ - $ - $ - $ 1 $ - Loss ratio 50.0 50.0 50.0 50.0 50.0 100.0 50.0 50.0 50.0 62.5 Less: effect of catastrophe losses - - - - - - - - - - effect of prior year non-catastrophe reserve reestimates - - (50.0) - - - - - (12.5) - Underlying loss ratio * 50.0 50.0 100.0 50.0 50.0 100.0 50.0 50.0 62.5 62.5 Expense ratio 50.0 50.0 50.0 - 50.0 - 50.0 50.0 37.5 37.5 Combined ratio 100.0 100.0 100.0 50.0 100.0 100.0 100.0 100.0 87.5 100.0 Effect of catastrophe losses - - - - - - - - - - Effect of prior year non-catastrophe reserve reestimates - - 50.0 - - - - - 12.5 - Underlying combined ratio * 100.0 100.0 150.0 50.0 100.0 100.0 100.0 100.0 100.0 100.0 Encompass brand other personal lines Net premiums written $ 20 $ 22 $ 25 $ 20 $ 22 $ 25 $ 27 $ 21 $ 87 $ 95 Net premiums earned $ 23 $ 23 $ 23 $ 24 $ 24 $ 25 $ 25 $ 26 $ 93 $ 100 Incurred losses (11) (13) (10) (21) (13) (17) (16) (31) (55) (77) Expenses (7) (7) (7) (7) (7) (8) (7) (7) (28) (29) Underwriting income (loss) $ 5 $ 3 $ 6 $ (4) $ 4 $ - $ 2 $ (12) $ 10 $ (6) Loss ratio 47.8 56.5 43.5 87.5 54.1 68.0 64.0 119.3 59.1 77.0 Less: effect of catastrophe losses 13.0 - 13.0 8.3 - 4.0 8.0 3.8 8.6 4.0 effect of prior year non-catastrophe reserve reestimates (21.7) (8.7) (26.1) 12.6 (16.7) 4.0 (16.0) 46.2 (10.8) 5.0 Underlying loss ratio * 56.5 65.2 56.6 66.6 70.8 60.0 72.0 69.3 61.3 68.0 Expense ratio 30.5 30.5 30.4 29.2 29.2 32.0 28.0 26.9 30.1 29.0 Combined ratio 78.3 87.0 73.9 116.7 83.3 100.0 92.0 146.2 89.2 106.0 Effect of catastrophe losses (13.0) - (13.0) (8.3) - (4.0) (8.0) (3.8) (8.6) (4.0) Effect of prior year non-catastrophe reserve reestimates 21.7 8.7 26.1 (12.6) 16.7 (4.0) 16.0 (46.2) 10.8 (5.0) Underlying combined ratio * 87.0 95.7 87.0 95.8 100.0 92.0 100.0 96.2 91.4 97.0 (1) Other personal lines include renter, condominium, landlord and other personal lines products in Allstate Protection. THE ALLSTATE CORPORATION OTHER PERSONAL LINES PROFITABILITY MEASURES BY BRAND (1) ($ in millions) Three months ended Twelve months ended

36 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Net premiums written $ 125 $ 116 $ 124 $ 123 $ 115 $ 123 $ 135 $ 126 $ 488 $ 499 Net premiums earned $ 128 $ 124 $ 118 $ 125 $ 123 $ 127 $ 127 $ 129 $ 495 $ 506 Incurred losses $ 89 $ 103 $ 86 $ 96 $ 109 $ 112 $ 135 $ 119 $ 374 $ 475 Expenses $ 37 $ 36 $ 34 $ 33 $ 34 $ 34 $ 35 $ 38 $ 140 $ 141 Underwriting income (loss) $ 2 $ (15) $ (2) $ (4) $ (20) $ (19) $ (43) $ (28) $ (19) $ (110) Loss ratio 69.5 83.1 72.9 76.8 88.6 88.2 106.3 92.2 75.5 93.9 Expense ratio 28.9 29.0 28.8 26.4 27.7 26.8 27.6 29.5 28.3 27.8 Combined ratio 98.4 112.1 101.7 103.2 116.3 115.0 133.9 121.7 103.8 121.7 Effect of catastrophe losses on combined ratio 1.6 10.5 1.7 5.6 5.7 5.5 9.5 7.0 4.8 6.9 Effect of prior year reserve reestimates on combined ratio 9.3 5.6 (1.7) 1.6 4.9 10.3 18.1 15.5 3.6 12.2 Effect of catastrophe losses included in prior year reserve reestimates on combined ratio - 0.8 (0.9) 0.8 0.8 - 0.8 2.4 0.2 1.0 (1) Commercial lines are all Allstate brand products. THE ALLSTATE CORPORATION COMMERCIAL LINES PROFITABILITY MEASURES (1) Three months ended Twelve months ended ($ in millions)

37 Dec. 31, Sept. 30, June 30, March 31, (net of reinsurance) 2017 2017 2017 2017 2017 2016 2015 2014 2013 Asbestos claims Beginning reserves $ 908 $ 867 $ 891 $ 912 $ 912 $ 960 $ 1,014 $ 1,017 $ 1,026 Incurred claims and claims expense - 61 - - 61 67 39 87 74 Claims and claims expense paid (24) (20) (24) (21) (89) (115) (93) (90) (83) Ending reserves $ 884 $ 908 $ 867 $ 891 $ 884 $ 912 $ 960 $ 1,014 $ 1,017 Claims and claims expense paid as a percent of ending reserves 2.7% 2.2% 2.8% 2.4% 10.1% 12.6% 9.7% 8.9% 8.2% Environmental claims Beginning reserves $ 175 $ 166 $ 178 $ 179 $ 179 $ 179 $ 203 $ 208 $ 193 Incurred claims and claims expense - 10 - - 10 23 1 15 30 Claims and claims expense paid (9) (1) (12) (1) (23) (23) (25) (20) (15) Ending reserves $ 166 $ 175 $ 166 $ 178 $ 166 $ 179 $ 179 $ 203 $ 208 Claims and claims expense paid as a percent of ending reserves 5.4% 0.6% 7.2% 0.6% 13.9% 12.8% 14.0% 9.9% 7.2% Other claims (1) Beginning reserves $ 363 $ 350 $ 349 $ 354 $ 354 $ 377 $ 395 $ 421 $ 418 Incurred claims and claims expense 3 17 3 2 25 15 13 11 38 Claims and claims expense paid (9) (4) (2) (7) (22) (38) (31) (37) (35) Ending reserves $ 357 $ 363 $ 350 $ 349 $ 357 $ 354 $ 377 $ 395 $ 421 Claims and claims expense paid as a percent of ending reserves 2.5% 1.1% 0.6% 2.0% 6.2% 10.7% 8.2% 9.4% 8.3% Total claims (2) Beginning reserves $ 1,446 $ 1,383 $ 1,418 $ 1,445 $ 1,445 $ 1,516 $ 1,612 $ 1,646 $ 1,637 Incurred claims and claims expense 3 88 3 2 96 105 53 113 142 Claims and claims expense paid (42) (25) (38) (29) (134) (176) (149) (147) (133) Ending reserves $ 1,407 $ 1,446 $ 1,383 $ 1,418 $ 1,407 $ 1,445 $ 1,516 $ 1,612 $ 1,646 Claims and claims expense paid as a percent of ending reserves 3.0% 1.7% 2.7% 2.0% 9.5% 12.2% 9.8% 9.1% 8.1% (1) (2) Other claims include other mass torts, workers' compensation, commercial and other. The 3-year survival ratio for the combined asbestos, environmental and other claims was 9.2, 9.2, 10.6, 12.0 and 14.2 for year-end 2017, 2016, 2015, 2014 and 2013, respectively, and is calculated by taking the ending reserves divided by net payments made during the year. THE ALLSTATE CORPORATION DISCONTINUED LINES AND COVERAGES RESERVES ($ in millions) Twelve months ended December 31,Three months ended

38 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Net premiums written $ 309 $ 272 $ 259 $ 254 $ 158 $ 185 $ 183 $ 183 $ 1,094 $ 709 Net premiums earned $ 231 $ 225 $ 211 $ 200 $ 145 $ 150 $ 142 $ 143 $ 867 $ 580 Intersegment insurance premiums and service fees 28 26 28 28 32 33 33 7 110 105 Net investment income 5 4 4 3 4 3 3 3 16 13 Claims and claims expense (90) (106) (83) (90) (60) (71) (65) (62) (369) (258) Amortization of deferred policy acquisition costs (79) (78) (72) (67) (57) (55) (52) (50) (296) (214) Operating costs and expenses (116) (98) (98) (89) (65) (61) (61) (36) (401) (223) Amortization of purchased intangible assets (23) (23) (23) (23) - - - - (92) - Restructuring and related charges (11) (1) (1) - - - - - (13) - Income tax benefit (expense) on operations 150 19 11 13 2 - - (2) 193 - Net income (loss) applicable to common shareholders 95 (32) (23) (25) 1 (1) - 3 15 3 Realized capital gains and losses, after-tax - - - - - - - - - - Amortization of purchased intangible assets, after-tax 15 15 15 15 - - - - 60 - Tax Legislation benefit (134) - - - - - - - (134) - Adjusted net (loss) income $ (24) $ (17) $ (8) $ (10) $ 1 $ (1) $ - $ 3 $ (59) $ 3 Allstate Roadside Services Net premiums written $ 60 $ 68 $ 66 $ 69 $ 67 $ 79 $ 77 $ 77 $ 263 $ 300 Net premiums earned 64 69 67 68 73 81 77 78 268 309 Intersegment insurance premiums and service fees 8 7 8 8 7 8 8 7 31 30 Net investment income - 1 - - 1 - - - 1 1 Claims and claims expense (35) (38) (35) (32) (39) (50) (43) (41) (140) (173) Amortization of deferred policy acquisition costs (4) (4) (5) (5) (5) (6) (6) (7) (18) (24) Operating costs and other expenses (44) (42) (42) (43) (44) (42) (38) (37) (171) (161) Restructuring and related charges - (1) (1) - - - - - (2) - Income tax benefit 8 3 3 1 2 3 1 - 15 6 Net loss $ (3) $ (5) $ (5) $ (3) $ (5) $ (6) $ (1) $ - $ (16) $ (12) Tax Legislation benefit (4) - - - - - - - (4) - Adjusted net loss $ (7) $ (5) $ (5) $ (3) $ (5) $ (6) $ (1) $ - $ (20) $ (12) Allstate Dealer Services Net premiums written $ 93 $ 100 $ 108 $ 104 $ 91 $ 106 $ 106 $ 106 $ 405 $ 409 Net premiums earned 79 78 74 73 72 69 65 65 304 271 Net investment income 4 3 4 3 3 3 3 3 14 12 Claims and claims expense (18) (27) (20) (22) (21) (21) (22) (21) (87) (85) Amortization of deferred policy acquisition costs (62) (63) (57) (54) (52) (49) (46) (43) (236) (190) Operating costs and other expenses (3) 2 2 - (1) - (3) 1 1 (3) Income tax benefit (expense) 70 3 (1) - 1 (1) 1 (2) 72 (1) Net (loss) income $ 70 $ (4) $ 2 $ - $ 2 $ 1 $ (2) $ 3 $ 68 $ 4 Tax Legislation benefit (70) - - - - - - - (70) - Adjusted net (loss) income $ - $ (4) $ 2 $ - $ 2 $ 1 $ (2) $ 3 $ (2) $ 4 Arity (2) Intersegment service fees $ 20 $ 19 $ 20 $ 20 $ 25 $ 25 $ 25 $ - $ 79 $ 75 Net investment income - - - - - - - - - - Operating costs and other expenses (25) (26) (27) (19) (20) (19) (20) - (97) (59) Income tax benefit (expense) (3) 3 1 - (1) (2) (2) - 1 (5) Net (loss) income $ (8) $ (4) $ (6) $ 1 $ 4 $ 4 $ 3 $ - $ (17) $ 11 Tax Legislation expense 2 - - - - - - - 2 - Adjusted net (loss) income $ (6) $ (4) $ (6) $ 1 $ 4 $ 4 $ 3 $ - $ (15) $ 11 (1) (2) There are no premiums written or earned for Arity. THE ALLSTATE CORPORATION SERVICE BUSINESSES SEGMENT RESULTS (1) ($ in millions) Three months ended Twelve months ended Service Businesses results include SquareTrade. SquareTrade was acquired on January 3, 2017 and is only included for the quarters and year-to-date periods of 2017. Further details related to SquareTrade results are on page 39.

39 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Net premiums written $ 156 $ 104 $ 85 $ 81 $ - $ - $ - $ - $ 426 $ - Net premiums earned $ 88 $ 78 $ 70 $ 59 $ - $ - $ - $ - $ 295 $ - Net investment income 1 - - - - - - - 1 - Realized capital gains and losses - - - - - - - - - - Claims and claims expense (37) (40) (29) (2) (36) - - - - (142) - Amortization of deferred policy acquisition costs (13) (11) (10) (8) - - - - (42) - Other costs and expenses (44) (33) (30) (27) - - - - (134) - Amortization of purchased intangible assets (23) (23) (23) (23) - - - - (92) - Restructuring and related charges (11) - - - - - - - (11) - Income tax benefit 75 10 8 12 - - - - 105 - Net income (loss) applicable to common shareholders $ 36 $ (19) $ (14) $ (23) $ - $ - $ - $ - $ (20) $ - Realized capital gains and losses, after-tax - - - - - - - - - - Amortization of purchased intangible assets, after-tax 15 15 15 15 - - - - 60 - Tax Legislation benefit (62) - - - - - - - (62) - Adjusted net (loss) income $ (11) $ (4) $ 1 $ (8) $ - $ - $ - $ - $ (22) $ - Fair value adjustments, after-tax (3) 3 2 3 4 - - - - 12 - Adjusted net (loss) income, excluding purchase accounting adjustments * $ (8) $ (2) $ 4 $ (4) $ - $ - $ - $ - $ (10) $ - Protection Plans in Force (in thousands) (4) (5) 38,719 34,078 31,258 29,907 - - - - 38,719 - New Issued Protection Plans (in thousands) (6) 8,210 5,122 3,586 3,840 - - - - 20,758 - (1) (2) (3) (4) (5) (6) In connection with the acquisition, purchase accounting adjustments made to recognize the acquired assets and liabilities at their fair value for unearned premiums, contractual liability insurance policy premium expenses, and commissions paid to retailers recorded as of the acquisition date are earned over the life of the in force contracts or approximately three years. SquareTrade had PIF of 28.5 million, 25.8 million, 24.4 million and 23.0 million at December 31, 2016, September 30, 2016, June 30, 2016, and March 31, 2016, respectively. These numbers are prior to the acquisition of SquareTrade on January 3, 2017 and are not reflected in the periods above. Protection plan terms generally range between one and five years with an average term of three years. SquareTrade had new issued protection plans of 5.1 million, 2.8 million, 2.6 million and 2.4 million at December 31, 2016, September 30, 2016, June 30, 2016, and March 31, 2016, respectively. These numbers are prior to the acquisition of SquareTrade on January 3, 2017 and are not reflected in the periods above. THE ALLSTATE CORPORATION SQUARETRADE RESULTS (1) ($ in millions) SquareTrade was acquired on January 3, 2017 and is only included for the quarters and year-to-date periods of 2017. Includes a $6 million favorable adjustment for loss experience. Three months ended Twelve months ended

40 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Premiums $ 149 $ 141 $ 140 $ 140 $ 140 $ 134 $ 131 $ 130 $ 570 $ 535 Contract charges 175 175 179 181 178 176 179 182 710 715 Net investment income 127 119 123 120 124 120 118 120 489 482 Contract benefits (210) (173) (187) (195) (188) (197) (177) (180) (765) (742) Interest credited to contractholder funds (71) (71) (71) (69) (72) (72) (71) (70) (282) (285) Amortization of deferred policy acquisition costs (27) (25) (35) (32) (32) (30) (32) (31) (119) (125) Operating costs and expenses (65) (56) (58) (59) (56) (59) (54) (56) (238) (225) Restructuring and related charges (1) (1) - - - - (1) - (2) (1) Income tax expense on operations (20) (35) (28) (27) (28) (21) (29) (29) (110) (107) Adjusted net income 57 74 63 59 66 51 64 66 253 247 Realized capital gains and losses, after-tax - 1 - 1 (7) (7) (2) (8) 2 (24) DAC and DSI amortization relating to realized capital gains and losses, after-tax (2) (2) (3) (3) (1) (1) (1) (1) (10) (4) Tax Legislation benefit 332 - - - - - - - 332 - Net income applicable to common shareholders $ 387 $ 73 $ 60 $ 57 $ 58 $ 43 $ 61 $ 57 $ 577 $ 219 Premiums and Contract Charges by Product Traditional life insurance premiums $ 148 $ 141 $ 139 $ 140 $ 140 $ 133 $ 130 $ 130 $ 568 $ 533 Accident and health insurance premiums 1 - 1 - - 1 1 - 2 2 Interest-sensitive life insurance contract charges 175 175 179 181 178 176 179 182 710 715 Total $ 324 $ 316 $ 319 $ 321 $ 318 $ 310 $ 310 $ 312 $ 1,280 $ 1,250 Proprietary Life Insurance Policies Sold by Allstate Agencies (1)(2) 43,318 28,962 31,447 25,970 38,614 27,481 29,839 25,458 129,697 121,392 Policies in Force (in thousands) (3) Life insurance Allstate agencies 1,903 1,893 1,891 1,887 1,889 1,884 1,883 1,880 1,903 1,889 Closed channels 121 123 126 127 131 132 136 138 121 131 Accident and health insurance 2 3 3 3 3 3 3 3 2 3 Total 2,026 2,019 2,020 2,017 2,023 2,019 2,022 2,021 2,026 2,023 (1) Policies sold reduced by lapses within twelve months of sale. (2) (3) Allstate exclusive agencies and exclusive financial specialists also sell non-proprietary retirement and investment products, including mutual funds, fixed and variable annuities, disability insurance, and long-term care insurance to provide a broad suite of protection and retirement products. As of December 31, 2017, Allstate agencies had approximately $16.8 billion of nonproprietary mutual funds and fixed and variable annuity account balances under management. New and additional deposits into these non-proprietary products were $2.1 billion in the twelve months ended December 31, 2017. Reflect the number of contracts in force. THE ALLSTATE CORPORATION ALLSTATE LIFE SEGMENT RESULTS AND OTHER STATISTICS ($ in millions) Three months ended Twelve months ended

41 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Benefit spread Premiums $ 149 $ 141 $ 140 $ 140 $ 140 $ 134 $ 131 $ 130 $ 570 $ 535 Cost of insurance contract charges (1) 119 121 123 124 121 120 122 125 487 488 Contract benefits (210) (173) (187) (195) (188) (197) (177) (180) (765) (742) Total benefit spread 58 89 76 69 73 57 76 75 292 281 Investment spread Net investment income 127 119 123 120 124 120 118 120 489 482 Interest credited to contractholder funds (71) (71) (71) (69) (72) (72) (71) (70) (282) (285) Total investment spread 56 48 52 51 52 48 47 50 207 197 Surrender charges and contract maintenance expense fees (1) 56 54 56 57 57 56 57 57 223 227 Realized capital gains and losses 1 2 1 1 (13) (10) (3) (12) 5 (38) Amortization of deferred policy acquisition costs (30) (29) (39) (36) (33) (31) (34) (33) (134) (131) Operating costs and expenses (65) (56) (58) (59) (56) (59) (54) (56) (238) (225) Restructuring and related charges (1) (1) - - - - (1) - (2) (1) Income tax benefit (expense) 312 (34) (28) (26) (22) (18) (27) (24) 224 (91) Net income applicable to common shareholders $ 387 $ 73 $ 60 $ 57 $ 58 $ 43 $ 61 $ 57 $ 577 $ 219 (1) Reconciliation of contract charges Cost of insurance contract charges $ 119 $ 121 $ 123 $ 124 $ 121 $ 120 $ 122 $ 125 $ 487 $ 488 Surrender charges and contract maintenance expense fees 56 54 56 57 57 56 57 57 223 227 Total contract charges $ 175 $ 175 $ 179 $ 181 $ 178 $ 176 $ 179 $ 182 $ 710 $ 715 THE ALLSTATE CORPORATION ALLSTATE LIFE ANALYSIS OF NET INCOME ($ in millions) Three months ended Twelve months ended

42 Dec. 31, 2017 Return on Equity Numerator: Net income applicable to common shareholders $ 577 Denominator: Ending equity (1) $ 2,591 Return on equity (2) 22.3 % Adjusted Net Income Return on Adjusted Equity * Numerator: Adjusted net income $ 253 Denominator: Ending equity (1) $ 2,591 Less: Unrealized net capital gains and losses 191 Goodwill 175 Adjusted ending equity $ 2,225 Adjusted net income return on adjusted equity * (2)(3) 11.4 % (1) (2) (3) In January 2018, the FASB issued a Proposed Accounting Standards Update titled “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” requiring reclassification of the impact of the newly enacted tax rates on the unrealized balances presented net of tax in accumulated other comprehensive income to retained income. We plan to early adopt the new guidance as of December 31, 2017, when finalized. The impact of the adoption will increase the adjusted net income return on adjusted equity calculation by 0.2 points. Ending equity has been used due to the changes in reportable segments, which was effective October 2017. The Tax Legislation adjustment recorded in fourth quarter 2017 increased return on equity by 11.5 points and decreased adjusted net income return on adjusted equity by 2.0 points. THE ALLSTATE CORPORATION ALLSTATE LIFE RETURN ON EQUITY ($ in millions) Twelve months ended

43 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Reserve for life-contingent contract benefits Traditional life insurance $ 2,460 $ 2,426 $ 2,420 $ 2,405 $ 2,398 $ 2,372 $ 2,359 $ 2,351 $ 2,460 $ 2,398 Accident health and insurance 176 178 180 179 180 180 180 184 176 180 Total $ 2,636 $ 2,604 $ 2,600 $ 2,584 $ 2,578 $ 2,552 $ 2,539 $ 2,535 $ 2,636 $ 2,578 Contractholders funds, beginning balance $ 7,559 $ 7,514 $ 7,497 $ 7,464 $ 7,446 $ 7,410 $ 7,385 $ 7,359 $ 7,464 $ 7,359 Deposits 243 236 243 251 243 250 245 253 973 991 Interest credited 71 71 70 70 72 71 71 70 282 284 Benefits, withdrawals and other adjustments Benefits (58) (54) (66) (63) (59) (65) (62) (59) (241) (245) Surrenders and partial withdrawals (64) (62) (63) (65) (63) (61) (62) (64) (254) (250) Contract charges (177) (175) (176) (176) (177) (176) (175) (177) (704) (705) Net transfers from separate accounts 1 - 2 1 - 2 1 1 4 4 Other adjustments 33 29 7 15 2 15 7 2 84 26 Total benefits, withdrawals and other adjustments (265) (262) (296) (288) (297) (285) (291) (297) (1,111) (1,170) Contractholder funds, ending balance $ 7,608 $ 7,559 $ 7,514 $ 7,497 $ 7,464 $ 7,446 $ 7,410 $ 7,385 $ 7,608 $ 7,464 THE ALLSTATE CORPORATION ALLSTATE LIFE RESERVES AND CONTRACTHOLDER FUNDS ($ in millions) Three months ended Twelve months ended

44 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Premiums $ 244 $ 244 $ 241 $ 241 $ 224 $ 227 $ 222 $ 224 $ 970 $ 897 Contract charges 29 29 28 28 28 30 29 27 114 114 Net investment income 18 18 19 17 17 18 18 18 72 71 Contract benefits (143) (142) (143) (136) (129) (131) (121) (128) (564) (509) Interest credited to contractholder funds (9) (8) (9) (9) (8) (9) (10) (9) (35) (36) Amortization of deferred policy acquisition costs (37) (31) (33) (41) (36) (36) (35) (38) (142) (145) Operating costs and expenses (70) (65) (64) (67) (62) (59) (60) (59) (266) (240) Restructuring and related charges (2) (1) - - - - - - (3) - Income tax expense on operations (10) (16) (14) (11) (11) (15) (14) (12) (51) (52) Adjusted net income 20 28 25 22 23 25 29 23 95 100 Realized capital gains and losses, after-tax (1) 1 - - (1) - - (3) - (4) Tax Legislation benefit 51 - - - - - - - 51 - Net income applicable to common shareholders $ 70 $ 29 $ 25 $ 22 $ 22 $ 25 $ 29 $ 20 $ 146 $ 96 Benefit ratio (1) 52.4 52.0 53.2 50.6 51.2 51.0 48.2 51.0 52.0 50.3 Operating expense ratio (2) 25.6 23.8 23.8 24.9 24.6 23.0 23.9 23.5 24.5 23.7 (1) (2) Benefit ratio is contract benefits divided by premiums and contract charges. Operating expense ratio is operating costs and expenses divided by premiums and contract charges. THE ALLSTATE CORPORATION ALLSTATE BENEFITS SEGMENT RESULTS AND OTHER STATISTICS ($ in millions) Three months ended Twelve months ended

45 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Premiums and Contract Charges by Product Life $ 40 $ 41 $ 37 $ 37 $ 39 $ 42 $ 37 $ 36 $ 155 $ 154 Accident 68 70 71 71 67 68 67 68 280 270 Critical illness 117 116 116 119 111 110 111 111 468 443 Disability 26 27 25 24 19 20 20 19 102 78 Other health 22 19 20 18 16 17 16 17 79 66 Total $ 273 $ 273 $ 269 $ 269 $ 252 $ 257 $ 251 $ 251 $ 1,084 $ 1,011 New Annualized Premium Sales by Product (1) Life $ 18 $ 10 $ 11 $ 9 $ 18 $ 9 $ 10 $ 11 $ 48 $ 48 Accident 55 21 21 25 48 23 22 25 122 118 Critical illness 74 22 23 28 70 22 24 29 147 145 Disability 13 9 10 29 13 7 7 7 61 34 Other health 35 7 8 16 28 8 7 10 66 53 Total $ 195 $ 69 $ 73 $ 107 $ 177 $ 69 $ 70 $ 82 $ 444 $ 398 Annualized Premium Inforce (2) $ 1,185 $ 1,187 $ 1,193 $ 1,179 $ 1,107 $ 1,102 $ 1,104 $ 1,093 $ 1,185 $ 1,107 Policies in Force (in thousands) (3) Life insurance 458 460 466 462 458 461 461 451 458 458 Accident and health insurance 3,575 3,575 3,598 3,530 3,297 3,272 3,291 3,275 3,575 3,297 Total 4,033 4,035 4,064 3,992 3,755 3,733 3,752 3,726 4,033 3,755 (1) (2) (3) New annualized premium sales reflects 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. Premium amount paid annually for all active policies, which have not been cancelled. Individual life insurance policies reflect the number of contracts in force. Group life and accident and health insurance reflect certificate counts as opposed to group counts. THE ALLSTATE CORPORATION ALLSTATE BENEFITS SEGMENT PREMIUM AND OTHER STATISTICS ($ in millions) Three months ended Twelve months ended

46 Dec. 31, 2017 Return on Equity Numerator: Net income applicable to common shareholders $ 146 Denominator: Ending equity (1) $ 801 Return on equity (2) 18.2 % Adjusted Net Income Return on Adjusted Equity * Numerator: Adjusted net income $ 95 Denominator: Ending equity (1) $ 801 Less: Unrealized net capital gains and losses 47 Goodwill 96 Adjusted ending equity $ 658 Adjusted net income return on adjusted equity * (2)(3) 14.4 % (1) (2) (3) In January 2018, the FASB issued a Proposed Accounting Standards Update titled “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” requiring reclassification of the impact of the newly enacted tax rates on the unrealized balances presented net of tax in accumulated other comprehensive income to retained income. We plan to early adopt the new guidance as of December 31, 2017, when finalized. The impact of the adoption will increase the adjusted net income return on adjusted equity calculation by 0.3 points. Ending equity has been used due to the changes in reportable segments, which was effective October 2017. The Tax Legislation adjustment recorded in fourth quarter 2017 increased return on equity by 5.5 points and decreased adjusted net income return on adjusted equity by 1.3 points. THE ALLSTATE CORPORATION ALLSTATE BENEFITS RETURN ON EQUITY ($ in millions) Twelve months ended

47 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Contract charges $ 4 $ 4 $ 3 $ 3 $ 4 $ 4 $ 3 $ 3 $ 14 $ 14 Net investment income 338 324 354 289 312 289 299 281 1,305 1,181 Contract benefits (154) (141) (156) (143) (147) (156) (156) (147) (594) (606) Interest credited to contractholder funds (90) (94) (93) (95) (97) (102) (98) (105) (372) (402) Amortization of deferred policy acquisition costs (2) (2) (1) (2) (2) (2) (1) (2) (7) (7) Operating costs and expenses (9) (9) (8) (9) (9) (8) (7) (8) (35) (32) Restructuring and related charges - 1 (1) - - - - - - - Income tax expense on operations (32) (28) (33) (14) (20) (7) (13) (7) (107) (47) Adjusted net income 55 55 65 29 41 18 27 15 204 101 Realized capital gains and losses, after-tax 22 11 (3) (2) - (7) 2 (21) 28 (26) Valuation changes on embedded derivatives not hedged, after-tax 2 (1) (1) - 6 - (4) (4) - (2) Gain on disposition of operations, after-tax 1 1 - 2 - 1 1 1 4 3 Tax Legislation benefit 182 - - - - - - - 182 - Net income applicable to common shareholders $ 262 $ 66 $ 61 $ 29 $ 47 $ 12 $ 26 $ (9) $ 418 $ 76 Policies in Force (in thousands) (1) Deferred annuities 142 145 148 152 156 160 163 168 142 156 Immediate annuities 89 91 92 94 95 96 98 99 89 95 231 236 240 246 251 256 261 267 231 251 (1) Allstate 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. THE ALLSTATE CORPORATION ALLSTATE ANNUITIES SEGMENT RESULTS AND OTHER STATISTICS ($ in millions) Three months ended Twelve months ended

48 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Benefit spread Cost of insurance contract charges (1) $ 3 $ 3 $ 1 $ 2 $ 3 $ 2 $ 2 $ 2 $ 9 $ 9 Contract benefits excluding the implied interest on immediate annuities with life contingencies (2) (29) (17) (30) (17) (19) (30) (27) (19) (93) (95) Total benefit spread (26) (14) (29) (15) (16) (28) (25) (17) (84) (86) Investment spread Net investment income (3) 338 324 354 289 312 289 299 281 1,305 1,181 Implied interest on immediate annuities with life contingencies (2) (125) (124) (126) (126) (128) (126) (129) (128) (501) (511) Interest credited to contractholder funds (88) (95) (95) (95) (88) (102) (104) (111) (373) (405) Total investment spread 125 105 133 68 96 61 66 42 431 265 Surrender charges and contract maintenance expense fees (1) 1 1 2 1 1 2 1 1 5 5 Realized capital gains and losses 33 18 (5) (2) 1 (10) 3 (32) 44 (38) Amortization of deferred policy acquisition costs (2) (2) (1) (2) (2) (2) (1) (2) (7) (7) Operating costs and expenses (9) (9) (8) (9) (9) (8) (7) (8) (35) (32) Restructuring and related charges - 1 (1) - - - - - - - Gain on disposition of operations 1 1 2 2 1 1 1 2 6 5 Income tax benefit (expense) 139 (35) (32) (14) (25) (4) (12) 5 58 (36) Net income applicable to common shareholders $ 262 $ 66 $ 61 $ 29 $ 47 $ 12 $ 26 $ (9) $ 418 $ 76 (1) Reconciliation of contract charges Cost of insurance contract charges $ 3 $ 3 $ 1 $ 2 $ 3 $ 2 $ 2 $ 2 $ 9 $ 9 Surrender charges and contract maintenance expense fees 1 1 2 1 1 2 1 1 5 5 Total contract charges $ 4 $ 4 $ 3 $ 3 $ 4 $ 4 $ 3 $ 3 $ 14 $ 14 (2) Reconciliation of contract benefits Contract benefits excluding the implied interest on immediate annuities with life contingencies $ (29) $ (17) $ (30) $ (17) $ (19) $ (30) $ (27) $ (19) $ (93) $ (95) Implied interest on immediate annuities with life contingencies (125) (124) (126) (126) (128) (126) (129) (128) (501) (511) Total contract benefits $ (154) $ (141) $ (156) $ (143) $ (147) $ (156) $ (156) $ (147) $ (594) $ (606) (3) Performance-based net investment income $ 142 $ 115 $ 137 $ 69 $ 97 $ 67 $ 67 $ 63 $ 463 $ 294 THE ALLSTATE CORPORATION ALLSTATE ANNUITIES ANALYSIS OF NET INCOME ($ in millions) Three months ended Twelve months ended

49 Dec. 31, 2017 Return on Equity Numerator: Net income applicable to common shareholders $ 418 Denominator: Ending equity (1) $ 4,947 Return on equity (2) 8.4 % Adjusted Net Income Return on Adjusted Equity * Numerator: Adjusted net income $ 204 Denominator: Ending equity (1) $ 4,947 Less: Unrealized net capital gains and losses 500 Adjusted ending equity $ 4,447 Adjusted net income return on adjusted equity * (2)(3) 4.6 % (1) (2) (3) In January 2018, the FASB issued a Proposed Accounting Standards Update titled “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” requiring reclassification of the impact of the newly enacted tax rates on the unrealized balances presented net of tax in accumulated other comprehensive income to retained income. We plan to early adopt the new guidance as of December 31, 2017, when finalized. The impact of the adoption will increase the adjusted net income return on adjusted equity calculation by 0.1 points. Ending equity has been used due to the changes in reportable segments, which was effective October 2017. The Tax Legislation adjustment recorded in fourth quarter 2017 increased return on equity by 3.4 points and decreased adjusted net income return on adjusted equity by 0.2 points. THE ALLSTATE CORPORATION ALLSTATE ANNUITIES RETURN ON EQUITY ($ in millions) Twelve months ended

50 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Reserve for life-contingent contract benefits Immediate fixed annuities with life contingencies: Sub-standard structured settlements and group pension terminations (1) $ 5,284 $ 5,027 $ 5,034 $ 5,033 $ 5,029 $ 5,028 $ 5,028 $ 5,028 $ 5,284 $ 5,029 Standard structured settlements and SPIA (2) 3,565 3,525 3,545 3,559 3,592 3,617 3,628 3,659 3,565 3,592 Subtotal (3) 8,849 8,552 8,579 8,592 8,621 8,645 8,656 8,687 8,849 8,621 Other 85 92 95 101 100 107 111 98 85 100 Total $ 8,934 $ 8,644 $ 8,674 $ 8,693 $ 8,721 $ 8,752 $ 8,767 $ 8,785 $ 8,934 $ 8,721 Contractholder funds Deferred fixed annuities $ 8,128 $ 8,341 $ 8,523 $ 8,722 $ 8,921 $ 9,115 $ 9,321 $ 9,555 $ 8,128 $ 8,921 Immediate fixed annuities without life contingencies (4) 2,700 2,744 2,792 2,831 2,874 2,928 2,998 3,040 2,700 2,874 Other (5) 108 119 113 116 120 216 241 241 108 120 Total $ 10,936 $ 11,204 $ 11,428 $ 11,669 $ 11,915 $ 12,259 $ 12,560 $ 12,836 $ 10,936 $ 11,915 Contractholders funds, beginning balance $ 11,204 $ 11,428 $ 11,669 $ 11,915 $ 12,259 $ 12,560 $ 12,836 $ 13,070 $ 11,915 $ 13,070 Deposits 5 6 6 11 13 8 11 10 28 42 Interest credited 88 94 94 94 87 102 104 110 370 403 Benefits, withdrawals, maturities and other adjustments Benefits (149) (163) (160) (166) (168) (188) (160) (189) (638) (705) Surrenders and partial withdrawals (197) (165) (180) (181) (169) (205) (231) (175) (723) (780) Maturities of and interest payments on institutional products - - - - (86) - - - - (86) Contract charges (3) (3) (1) (2) (3) (2) (2) (2) (9) (9) Net transfers from separate accounts - - - 1 1 - - - 1 1 Other adjustments (12) 7 - (3) (19) (16) 2 12 (8) (21) Total benefits, withdrawals, maturities and other adjustments (361) (324) (341) (351) (444) (411) (391) (354) (1,377) (1,600) Contractholder funds, ending balance $ 10,936 $ 11,204 $ 11,428 $ 11,669 $ 11,915 $ 12,259 $ 12,560 $ 12,836 $ 10,936 $ 11,915 (1) (2) (3) (4) (5) Period certain structured settlements and single premium immediate annuities without life contingencies. Includes $85 million related to institutional products in September 30, 2016, June 30, 2016 and March 31, 2016. THE ALLSTATE CORPORATION ALLSTATE ANNUITIES RESERVES AND CONTRACTHOLDER FUNDS ($ in millions) Three months ended Twelve months ended Life-contingent structured settlement annuities for annuitants with standard life expectancy and single premium immediate annuities with life contingencies. Structured settlement annuities for 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. To the extent that unrealized gains on fixed income securities would result in a premium deficiency had those gains actually been realized, a premium deficiency reserve is recorded for certain immediate annuities with life contingencies. A liability of $315 million is included in the reserve for life-contingent contract benefits with respect to this deficiency as of December 31, 2017. The offset to this liability is recorded as a reduction of the unrealized net capital gains included in accumulated other comprehensive income. The liability was zero for all other periods presented here.

51 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Net investment income $ 10 $ 10 $ 10 $ 11 $ 10 $ 11 $ 11 $ 10 $ 41 $ 42 Operating costs and expenses (44) (1) (93) (1) (9) (8) (9) (7) (7) (6) (154) (1) (29) Interest expense (84) (82) (83) (85) (77) (73) (72) (73) (334) (295) Income tax benefit on operations 43 60 31 30 29 26 26 25 164 106 Preferred stock dividends (29) (29) (29) (29) (29) (29) (29) (29) (116) (116) Adjusted net loss (104) (134) (80) (81) (76) (72) (71) (73) (399) (292) Realized capital gains and losses, after-tax (4) - - - (1) - (1) - (4) (2) Business combination expenses, after-tax (2) - (1) - (13) - - - - (14) - Goodwill impairment (125) - - - - - - - (125) - Tax Legislation expense (128) - - - - - - - (128) - Net loss applicable to common shareholders $ (361) $ (135) $ (80) $ (94) $ (77) $ (72) $ (72) $ (73) $ (670) $ (294) (1) (2) Relates to SquareTrade acquisition on January 3, 2017. Includes a pension settlement loss of $36 million and $86 million for the three months ended December 31, 2017 and September 30, 2017, respectively. THE ALLSTATE CORPORATION CORPORATE AND OTHER SEGMENT RESULTS ($ in millions) Three months ended Twelve months ended

52 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2017 2017 2017 2017 2016 2016 2016 2016 Consolidated Investments Fixed income securities, at fair value: Tax-exempt $ 6,010 $ 5,479 $ 5,520 $ 5,164 $ 4,982 $ 5,399 $ 5,223 $ 5,059 Taxable 52,982 53,912 53,136 53,472 52,857 54,907 52,906 52,232 Equity securities, at fair value (1) 6,621 6,434 6,117 5,685 5,666 5,288 5,265 5,117 Mortgage loans 4,534 4,322 4,336 4,349 4,486 4,396 4,453 4,302 Limited partnership interests (2) 6,740 6,600 6,206 5,982 5,814 5,588 5,407 5,091 Short-term, at fair value 1,944 2,198 2,175 2,753 4,288 1,863 2,850 3,526 Other 3,972 3,826 3,815 3,738 3,706 3,663 3,590 3,550 Total $ 82,803 $ 82,771 $ 81,305 $ 81,143 $ 81,799 $ 81,104 $ 79,694 $ 78,877 Fixed income securities, amortized cost: Tax-exempt $ 6,011 $ 5,440 $ 5,482 $ 5,165 $ 5,025 $ 5,307 $ 5,096 $ 4,955 Taxable 51,514 52,168 51,419 52,029 51,551 52,468 50,674 50,672 Ratio of fair value to amortized cost 102.6 % 103.1 % 103.1 % 102.5 % 102.2 % 104.4 % 104.2 % 103.0 % Equity securities, cost $ 5,461 $ 5,468 $ 5,321 $ 5,026 $ 5,157 $ 4,800 $ 4,924 $ 4,792 Short-term, amortized cost 1,944 2,198 2,175 2,753 4,288 1,863 2,850 3,526 (1) (2) THE ALLSTATE CORPORATION CONSOLIDATED INVESTMENTS ($ in millions) Equity securities may include investments in exchange traded and mutual funds whose underlying investments are fixed income securities. As of December 31, 2017, we have commitments to invest in additional limited partnership interests totaling $3.2 billion.

53 Property- Service Allstate Allstate Allstate Corporate Liability Businesses Life Benefits Annuities and Other Total Investments by Segment Fixed income securities, at fair value: Tax-exempt $ 5,441 $ 2 $ - $ - $ 18 $ 549 $ 6,010 Taxable 26,299 755 7,904 1,159 15,673 1,192 52,982 Equity securities, at fair value (1) 4,752 144 42 89 1,584 10 6,621 Mortgage loans 394 - 1,823 195 2,122 - 4,534 Limited partnership interests 3,599 - - - 3,141 - 6,740 Short-term, at fair value 909 53 228 18 529 207 1,944 Other 1,789 - 1,213 315 655 - 3,972 Total $ 43,183 $ 954 $ 11,210 $ 1,776 $ 23,722 $ 1,958 $ 82,803 Fixed income securities, amortized cost: Tax-exempt $ 5,448 $ 2 $ - $ - $ 18 $ 543 $ 6,011 Taxable 26,139 758 7,413 1,116 14,896 1,192 51,514 Ratio of fair value to amortized cost 100.5 % 99.6 % 106.6 % 103.9 % 105.2 % 100.3 % 102.6 % Equity securities, cost $ 3,932 $ 144 $ 41 $ 57 $ 1,277 $ 10 $ 5,461 Short-term, amortized cost 909 53 228 18 529 207 1,944 Fixed income securities portfolio duration (in years) (2) 3.28 2.68 5.70 5.01 4.13 2.30 3.83 (1) (2) Duration measures the price sensitivity of assets and liabilities to changes in interest rates. THE ALLSTATE CORPORATION INVESTMENTS BY SEGMENT ($ in millions) As of December 31, 2017 Equity securities may include investments in exchange traded and mutual funds whose underlying investments are fixed income securities.

54 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 $ 36 $ 3,616 101.0 $ 57 $ 3,900 101.5 $ 63 $ 3,426 101.9 Municipal 275 8,328 103.4 310 7,794 104.1 312 7,855 104.1 Corporate 1,030 44,026 102.4 1,287 44,546 103.0 1,244 44,251 102.9 Foreign government 16 1,021 101.6 16 1,093 101.5 28 1,047 102.7 Asset-backed securities ("ABS") 6 1,272 100.5 7 1,270 100.6 6 1,243 100.5 Residential mortgage-backed securities ("RMBS") 98 578 120.4 99 611 119.3 92 641 116.8 Commercial mortgage-backed securities ("CMBS") 4 128 103.2 4 153 102.7 7 170 104.3 Redeemable preferred stock 2 23 109.5 3 24 114.3 3 23 115.0 Total fixed income securities 1,467 58,992 102.6 1,783 59,391 103.1 1,755 58,656 103.1 Equity securities (2) 1,160 6,621 121.2 966 6,434 117.7 796 6,117 115.0 Short-term investments - 1,944 100.0 - 2,198 100.0 - 2,175 100.0 Derivatives (1) 127 n/a (2) 101 n/a (1) 108 n/a EMA limited partnership interests (3) 1 n/a n/a - n/a n/a (1) n/a n/a Unrealized net capital gains and losses, pre-tax 2,627 2,747 2,549 Amounts recognized for: Insurance reserves (4) (315) - - DAC and DSI (5) (196) (203) (198) Amounts recognized (511) (203) (198) Deferred income taxes (744) (893) (825) Unrealized net capital gains and losses, after-tax $ 1,372 $ 1,651 $ 1,526 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 $ 66 $ 4,395 101.5 $ 65 $ 3,637 101.8 $ 105 $ 4,304 102.5 Municipal 258 7,507 103.6 217 7,333 103.0 470 7,902 106.3 Corporate 992 43,535 102.3 859 43,601 102.0 1,804 44,474 104.2 Foreign government 32 1,027 103.2 32 1,075 103.1 59 1,119 105.6 ABS 3 1,265 100.2 2 1,171 100.2 (3) 1,390 99.8 RMBS 83 672 114.1 77 728 111.8 82 778 111.8 CMBS 5 211 102.4 8 270 103.1 11 315 103.6 Redeemable preferred stock 3 24 114.3 3 24 114.3 3 24 114.3 Total fixed income securities 1,442 58,636 102.5 1,263 57,839 102.2 2,531 60,306 104.4 Equity securities (2) 659 5,685 113.1 509 5,666 109.9 488 5,288 110.2 Short-term investments - 2,753 100.0 - 4,288 100.0 - 1,863 100.0 Derivatives - 108 n/a 2 111 n/a 1 85 n/a EMA limited partnership interests (3) - n/a n/a (4) n/a n/a (5) n/a n/a Unrealized net capital gains and losses, pre-tax 2,101 1,770 3,015 Amounts recognized for: Insurance reserves (4) - - - DAC and DSI (5) (165) (146) (216) Amounts recognized (165) (146) (216) Deferred income taxes (680) (571) (982) Unrealized net capital gains and losses, after-tax $ 1,256 $ 1,053 $ 1,817 (1) (2) (3) (4) (5) THE ALLSTATE CORPORATION UNREALIZED NET CAPITAL GAINS AND LOSSES ON SECURITY PORTFOLIO BY TYPE ($ in millions) December 31, 2017 September 30, 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016 Beginning January 1, 2018, due to the adoption of the new accounting standard for the recognition and measurement of financial assets and liabilities, equity securities will be measured at fair value with changes in fair value recognized in net income. The existing unrealized net capital gains and losses, after-tax, will be reclassified to retained income through a cumulative effect adjustment. 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. The comparison of percentages from period to period may be distorted by investment transactions such as sales, purchases and impairment write-downs. Unrealized net capital gains and losses for limited partnership interests represent the Company's share of EMA limited partnerships' other comprehensive income. Fair value and amortized cost are not applicable. 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. This adjustment primarily relates to structured settlement annuities with life contingencies (a type of immediate fixed annuities).

55 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Net Investment Income Fixed income securities $ 514 $ 519 $ 527 $ 518 $ 514 $ 508 $ 520 $ 518 $ 2,078 $ 2,060 Equity securities 44 37 49 44 34 31 44 28 174 137 Mortgage loans 49 52 50 55 55 56 53 53 206 217 Limited partnership interests ("LP") 293 223 253 120 178 136 126 121 889 561 Short-term 9 9 6 6 5 4 3 4 30 16 Other 62 58 60 56 59 55 57 51 236 222 Investment income, before expense 971 898 945 799 845 790 803 775 3,613 3,213 Less: Investment expense (58) (55) (48) (51) (44) (42) (41) (44) (212) (171) Net investment income $ 913 $ 843 $ 897 $ 748 $ 801 $ 748 $ 762 $ 731 $ 3,401 $ 3,042 Interest-bearing investments (1) $ 623 $ 627 $ 631 $ 625 $ 622 $ 613 $ 623 $ 618 $ 2,506 $ 2,476 Equity securities 44 37 49 44 34 31 44 28 174 137 LP and other alternative investments (2) 304 234 265 130 189 146 136 129 933 600 Investment income, before expense $ 971 $ 898 $ 945 $ 799 $ 845 $ 790 $ 803 $ 775 $ 3,613 $ 3,213 Pre-Tax Yields (3) Fixed income securities 3.6 % 3.6 % 3.7 % 3.6 % 3.6 % 3.6 % 3.7 % 3.7 % 3.6 % 3.6 % Equity securities 3.2 2.7 3.8 3.5 2.7 2.5 3.7 2.3 3.3 2.8 Mortgage loans 4.4 4.8 4.6 4.9 5.0 5.0 4.9 4.9 4.7 4.9 Limited partnership interests 17.5 13.9 16.6 8.1 12.5 9.9 9.6 9.7 14.2 10.5 Total portfolio 4.8 4.5 4.7 4.0 4.2 4.0 4.1 4.0 4.5 4.1 Interest-bearing investments 3.7 3.7 3.8 3.7 3.7 3.7 3.8 3.7 3.7 3.7 Realized Capital Gains and Losses (Pre-tax) by Transaction Type Impairment write-downs $ (8) $ (23) $ (28) $ (43) $ (49) $ (63) $ (63) $ (59) $ (102) $ (234) Change in intent write-downs (5) (5) (22) (16) (21) (10) (16) (22) (48) (69) Net other-than-temporary impairment losses recognized in earnings (13) (28) (50) (59) (70) (73) (79) (81) (150) (303) Sales and other 146 148 139 208 47 121 104 (59) 641 213 Valuation and settlements of derivative instruments (6) (17) (8) (15) 25 (15) (1) (9) (46) - Total $ 127 $ 103 $ 81 $ 134 $ 2 $ 33 $ 24 $ (149) $ 445 $ (90) Total Return on Investment Portfolio (4) Income 1.1 % 1.0 % 1.1 % 0.9 % 1.0 % 0.9 % 1.0 % 0.9 % 4.1 % 3.8 % Valuation - 0.5 0.7 0.7 (1.7) 0.4 0.9 1.1 1.8 0.6 Total 1.1 % 1.5 % 1.8 % 1.6 % (0.7) % 1.3 % 1.9 % 2.0 % 5.9 % 4.4 % Average Investment Balances (in billions) (5) $ 80.1 $ 79.4 $ 78.9 $ 79.5 $ 79.1 $ 77.5 $ 76.9 $ 76.8 $ 79.6 $ 77.7 (1) (2) (3) (4) (5) THE ALLSTATE CORPORATION NET INVESTMENT INCOME, YIELDS AND REALIZED CAPITAL GAINS AND LOSSES (PRE-TAX) ($ in millions) Three months ended Twelve months ended Comprise fixed income securities, mortgage loans, short-term investments, and other investments including bank and agent loans and derivatives. Comprise limited partnership interests and other alternative investments, including real estate investments classified as other investments. Quarterly pre-tax yield is calculated as annualized quarterly investment income, before investment expense divided by the average of the current and prior quarter investment balances. Year-to-date pre-tax yield is calculated as annualized year-to-date investment income, before investment expense divided by the average of investment balances at the beginning of the year and the end of each quarter during the year. For the purposes of the pre-tax yield calculation, income for directly held real estate and other consolidated investments is net of investee level expenses (depreciation and asset level operating expenses reported in investment expense). For investments carried at fair value, investment balances exclude unrealized capital gains and losses. 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, cost method limited partnerships, bank loans and agent loans divided by the average fair value balances. 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.

56 Property- Service Allstate Allstate Allstate Corporate Liability Businesses Life Benefits Annuities and Other Total Net Investment Income Fixed income securities $ 228 $ 4 $ 92 $ 12 $ 168 $ 10 $ 514 Equity securities 32 1 1 1 9 - 44 Mortgage loans 3 - 20 2 24 - 49 Limited partnership interests ("LP") 151 - - - 142 - 293 Short-term 5 - 1 - 2 1 9 Other 26 - 18 4 13 1 62 Investment income, before expense 445 5 132 19 358 12 971 Less: Investment expense (30) - (5) (1) (20) (2) (58) Net investment income $ 415 $ 5 $ 127 $ 18 $ 338 $ 10 $ 913 Interest-bearing investments (1) $ 255 $ 4 $ 131 $ 18 $ 203 $ 12 $ 623 Equity securities 32 1 1 1 9 - 44 LP and other alternative investments (2) 158 - - - 146 - 304 Investment income, before expense $ 445 $ 5 $ 132 $ 19 $ 358 $ 12 $ 971 Pre-Tax Yields (3) Fixed income securities 2.9 % 2.0 % 4.9 % 4.2 % 4.6 % 2.3 % 3.6 % Equity securities 3.4 3.5 3.6 4.3 2.8 0.1 3.2 Mortgage loans 3.8 - 4.5 4.4 4.5 - 4.4 Limited partnership interests 17.1 - - - 18.1 - 17.5 Total portfolio 4.2 2.2 4.9 4.5 6.3 2.3 4.8 Interest-bearing investments 3.0 1.9 4.9 4.5 4.5 2.3 3.7 Realized Capital Gains and Losses (Pre-tax) by transaction type Impairment write-downs $ (2) $ - $ - $ - $ (2) $ (4) $ (8) Change in intent write-downs (5) - - - - - (5) Net other-than-temporary impairment losses recognized in earnings (7) - - - (2) (4) (13) Sales and other 109 - 1 - 38 (2) 146 Valuation and settlements of derivative instruments (3) - - - (3) - (6) Total $ 99 $ - $ 1 $ - $ 33 $ (6) $ 127 (1) (2) (3) Quarterly pre-tax yield is calculated as annualized quarterly investment income, before investment expense divided by the average of the current and prior quarter investment balances. For the purposes of the pre-tax yield calculation, income for directly held real estate and other consolidated investments is net of investee level expenses (depreciation and asset level operating expenses reported in investment expense). For investments carried at fair value, investment balances exclude unrealized capital gains and losses. THE ALLSTATE CORPORATION NET INVESTMENT INCOME, YIELDS AND REALIZED CAPITAL GAINS AND LOSSES (PRE-TAX) BY SEGMENT ($ in millions) Three months ended December 31, 2017 Comprise fixed income securities, mortgage loans, short-term investments, and other investments including bank and agent loans and derivatives. Comprise limited partnership interests and other alternative investments, including real estate investments classified as other investments.

57 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Market-Based ("MB") (1) Investment Position Interest-bearing investments $ 68,648 $ 69,070 $ 68,331 $ 68,836 $ 69,688 $ 69,579 $ 68,357 $ 68,001 $ 68,648 $ 69,688 Equity securities (2) 6,483 6,336 6,021 5,578 5,567 5,194 5,192 5,032 6,483 5,567 LP and other alternative investments (3) 738 694 591 555 535 481 405 403 738 535 Total $ 75,869 $ 76,100 $ 74,943 $ 74,969 $ 75,790 $ 75,254 $ 73,954 $ 73,436 $ 75,869 $ 75,790 Investment income Interest-bearing investments $ 620 $ 625 $ 629 $ 624 $ 622 $ 611 $ 618 $ 614 $ 2,498 $ 2,465 Equity securities 44 37 45 35 34 31 44 28 161 137 LP and other alternative investments 1 1 - - (1) 1 - - 2 - Investment income, before expense 665 663 674 659 655 643 662 642 2,661 2,602 Investee level expenses (4) (1) (1) (2) (1) (1) (1) (1) (1) (5) (4) Income for yield calculation $ 664 $ 662 $ 672 $ 658 $ 654 $ 642 $ 661 $ 641 $ 2,656 $ 2,598 Market-based pre-tax yield 3.6 % 3.6 % 3.7 % 3.6 % 3.6 % 3.6 % 3.7 % 3.6 % 3.6 % 3.6 % Realized capital gains and losses (pre-tax) by transaction type Impairment write-downs $ (8) $ (7) $ (19) $ (36) $ (26) $ (37) $ (50) $ (31) $ (70) $ (144) Change in intent write-downs (5) (5) (22) (16) (21) (10) (16) (21) (48) (68) Net other-than-temporary impairment losses recognized in earnings (13) (12) (41) (52) (47) (47) (66) (52) (118) (212) Sales and other 141 148 129 208 43 118 123 (80) 626 204 Valuation and settlements of derivative instruments 1 (12) (1) (10) 13 (13) (5) (6) (22) (11) Total $ 129 $ 124 $ 87 $ 146 $ 9 $ 58 $ 52 $ (138) $ 486 $ (19) Performance-Based ("PB") (5) Investment Position Interest-bearing investments $ 120 $ 130 $ 129 $ 108 $ 113 $ 130 $ 162 $ 162 $ 120 $ 113 Equity securities 138 98 96 107 99 94 73 85 138 99 LP and other alternative investments 6,676 6,443 6,137 5,959 5,797 5,626 5,505 5,194 6,676 5,797 Total $ 6,934 $ 6,671 $ 6,362 $ 6,174 $ 6,009 $ 5,850 $ 5,740 $ 5,441 $ 6,934 $ 6,009 Investment income Interest-bearing investments $ 3 $ 2 $ 2 $ 1 $ - $ 2 $ 5 $ 4 $ 8 $ 11 Equity securities - - 4 9 - - - - 13 - LP and other alternative investments 303 233 265 130 190 145 136 129 931 600 Investment income, before expense 306 235 271 140 190 147 141 133 952 611 Investee level expenses (10) (8) (8) (9) (8) (8) (8) (8) (35) (32) Income for yield calculation $ 296 $ 227 $ 263 $ 131 $ 182 $ 139 $ 133 $ 125 $ 917 $ 579 Performance-based pre-tax yield 17.4 % 14.0 % 16.8 % 8.7 % 12.3 % 9.7 % 9.5 % 9.3 % 14.3 % 10.3 % Realized capital gains and losses (pre-tax) by transaction type Impairment write-downs $ - $ (16) $ (9) $ (7) $ (23) $ (26) $ (13) $ (28) $ (32) $ (90) Change in intent write-downs - - - - - - - (1) - (1) Net other-than-temporary impairment losses recognized in earnings - (16) (9) (7) (23) (26) (13) (29) (32) (91) Sales and other 5 - 10 - 4 3 (19) 21 15 9 Valuation and settlements of derivative instruments (7) (5) (7) (5) 12 (2) 4 (3) (24) 11 Total $ (2) $ (21) $ (6) $ (12) $ (7) $ (25) $ (28) $ (11) $ (41) $ (71) (1) (2) (3) (4) (5) Market-based strategy seeks to deliver predictable earnings aligned to business needs and take advantage of short-term opportunities primarily through public and private fixed income investments and public equity securities. Market-based investments include publicly traded equity securities classified as limited partnerships. When calculating the pre-tax yields, investee level expenses are netted against income for directly held real estate and other consolidated investments. Performance-based strategy seeks to deliver attractive risk-adjusted returns and supplement market risk with idiosyncratic risk primarily through investments in private equity and real estate. THE ALLSTATE CORPORATION INVESTMENT POSITION AND RESULTS BY STRATEGY ($ in millions) As of or for the three months ended As of or for the twelve months ended Equity securities may include investments in exchange traded and mutual funds whose underlying investments are fixed income securities.

58 Property- Service Allstate Allstate Allstate Corporate Liability Businesses Life Benefits Annuities and Other Total Market-based ("MB") (1) Investment Position Interest-bearing investments $ 34,236 $ 810 $ 11,168 $ 1,687 $ 18,799 $ 1,948 $ 68,648 Equity securities (2) 4,672 144 42 89 1,526 10 6,483 LP and other alternative investments (3) 504 - - - 234 - 738 Total $ 39,412 $ 954 $ 11,210 $ 1,776 $ 20,559 $ 1,958 $ 75,869 Investment income Interest-bearing investments $ 253 $ 4 $ 131 $ 18 $ 202 $ 12 $ 620 Equity securities 32 1 1 1 9 - 44 LP and other alternative investments 1 - - - - - 1 Investment income, before expense 286 5 132 19 211 12 665 Investee level expenses (4) (1) - - - - - (1) Income for yield calculation $ 285 $ 5 $ 132 $ 19 $ 211 $ 12 $ 664 Market-based pre-tax yield 3.0 % 2.2 % 4.9 % 4.5 % 4.3 % 2.3 % 3.6 % Realized capital gains and losses (pre-tax) by transaction type Impairment write-downs $ (2) $ - $ - $ - $ (2) $ (4) $ (8) Change in intent write-downs (5) - - - - - (5) Net other-than-temporary impairment losses recognized in earnings (7) - - - (2) (4) (13) Sales and other 108 - 1 - 34 (2) 141 Valuation and settlements of derivative instruments 1 - - - - - 1 Total $ 102 $ - $ 1 $ - $ 32 $ (6) $ 129 Performance-based ("PB") (5) Investment Position Interest-bearing investments $ 98 $ - $ - $ - $ 22 $ - $ 120 Equity securities 80 - - - 58 - 138 LP and other alternative investments 3,593 - - - 3,083 - 6,676 Total $ 3,771 $ - $ - $ - $ 3,163 $ - $ 6,934 Investment income Interest-bearing investments $ 2 $ - $ - $ - $ 1 $ - $ 3 Equity securities - - - - - - - LP and other alternative investments 157 - - - 146 - 303 Investment income, before expense 159 - - - 147 - 306 Investee level expenses (5) - - - (5) - (10) Income for yield calculation $ 154 $ - $ - $ - $ 142 $ - $ 296 Performance-based pre-tax yield 16.9 % N/A % N/A % N/A % 18.0 % N/A % 17.4 % Realized capital gains and losses (pre-tax) by transaction type Impairment write-downs $ - $ - $ - $ - $ - $ - $ - Change in intent write-downs - - - - - - - Net other-than-temporary impairment losses recognized in earnings - - - - - - - Sales and other 1 - - - 4 - 5 Valuation and settlements of derivative instruments (4) - - - (3) - (7) Total $ (3) $ - $ - $ - $ 1 $ - $ (2) (1) (2) (3) (4) (5) When calculating the pre-tax yields, investee level expenses are netted against income for directly held real estate and other consolidated investments. Performance-based strategy seeks to deliver attractive risk-adjusted returns and supplement market risk with idiosyncratic risk primarily through investments in private equity and real estate. THE ALLSTATE CORPORATION INVESTMENT POSITION AND RESULTS BY STRATEGY BY SEGMENT ($ in millions) As of or for the three months ended December 31, 2017 Market-based strategy seeks to deliver predictable earnings aligned to business needs and take advantage of short-term opportunities primarily through public and private fixed income investments and public equity securities. Market-based investments include publicly traded equity securities classified as limited partnerships. Equity securities may include investments in exchange traded and mutual funds whose underlying investments are fixed income securities.

59 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Dec. 31, 2017 2017 2017 2017 2016 2016 2016 2016 2017 2016 Investment position Limited partnerships Private equity $ 4,752 $ 4,650 $ 4,333 $ 4,139 $ 4,031 $ 3,839 $ 3,663 $ 3,324 $ 4,752 $ 4,031 Real estate 1,293 1,296 1,320 1,325 1,281 1,301 1,374 1,399 1,293 1,281 PB - limited partnerships 6,045 5,946 5,653 5,464 5,312 5,140 5,037 4,723 6,045 5,312 Non-LP Private equity 210 170 171 161 151 165 179 190 210 151 Real estate 679 555 538 549 546 545 524 528 679 546 PB - non-LP 889 725 709 710 697 710 703 718 889 697 Total Private equity 4,962 4,820 4,504 4,300 4,182 4,004 3,842 3,514 4,962 4,182 Real estate 1,972 1,851 1,858 1,874 1,827 1,846 1,898 1,927 1,972 1,827 Total PB $ 6,934 $ 6,671 $ 6,362 $ 6,174 $ 6,009 $ 5,850 $ 5,740 $ 5,441 $ 6,934 $ 6,009 Investment income Limited partnerships Private equity $ 219 $ 183 $ 209 $ 114 $ 145 $ 112 $ 113 $ 85 $ 725 $ 455 Real estate 74 40 44 6 34 23 13 36 164 106 PB - limited partnerships 293 223 253 120 179 135 126 121 889 561 Non-LP Private equity 3 2 5 9 1 2 4 2 19 9 Real estate 10 10 13 11 10 10 11 10 44 41 PB - non-LP 13 12 18 20 11 12 15 12 63 50 Total Private equity 222 185 214 123 146 114 117 87 744 464 Real estate 84 50 57 17 44 33 24 46 208 147 Total PB $ 306 $ 235 $ 271 $ 140 $ 190 $ 147 $ 141 $ 133 $ 952 $ 611 Investee level expenses $ (10) $ (8) $ (8) $ (9) $ (8) $ (8) $ (8) $ (8) $ (35) $ (32) Realized capital gains and losses Limited partnerships Private equity $ (3) $ (17) $ (8) $ (10) $ (26) $ (23) $ (20) $ 12 $ (38) $ (57) Real estate 2 - 4 1 2 2 - 1 7 5 PB - limited partnerships (1) (17) (4) (9) (24) (21) (20) 13 (31) (52) Non-LP Private equity (7) (4) (11) (4) 16 (4) (8) (25) (26) (21) Real estate 6 - 9 1 1 - - 1 16 2 PB - non-LP (1) (4) (2) (3) 17 (4) (8) (24) (10) (19) Total Private equity (10) (21) (19) (14) (10) (27) (28) (13) (64) (78) Real estate 8 - 13 2 3 2 - 2 23 7 Total PB $ (2) $ (21) $ (6) $ (12) $ (7) $ (25) $ (28) $ (11) $ (41) $ (71) Pre-Tax Yield 17.4 % 14.0 % 16.8 % 8.7 % 12.3 % 9.7 % 9.5 % 9.3 % 14.3 % 10.3 % Internal Rate of Return (1) 10 Year 8.6 % 8.5 % 8.3 % 9.5 % 10.1 % 10.1 % 10.2 % 10.5 5 Year 12.8 12.7 11.9 11.9 12.0 11.7 12.0 12.7 (1) The internal rate of return ("IRR") is one of the measures we use to evaluate the performance of these investments. The IRR represents the rate of return on the investments considering the cash flows paid and received and, until the investment is fully liquidated, the estimated value of investment holdings at the end of the measurement period. The calculated IRR for any measurement period is highly influenced by the values of the portfolio at the beginning and end of the period, which reflect the estimated fair values of the investments as of such dates. As a result, the IRR can vary significantly for different measurement periods based on macroeconomic or other events that impact the estimated beginning or ending portfolio value, such as the global financial crisis. Our IRR calculation method may differ from those used by other investors. The timing of the recognition of income in the financial statements may differ significantly from the cash distributions and changes in the value of these investments. THE ALLSTATE CORPORATION PERFORMANCE-BASED INVESTMENTS ($ in millions) As of or for the three months ended As of or for the twelve months ended

60 Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, 2017 2017 2017 2017 2016 2016 2016 2016 Investment position Accounting basis Cost method $ 1,327 $ 1,339 $ 1,269 $ 1,293 $ 1,282 $ 1,375 $ 1,284 $ 1,193 Equity method ("EMA") (1) 5,413 5,261 4,937 4,689 4,532 4,213 4,123 3,898 Total $ 6,740 $ 6,600 $ 6,206 $ 5,982 $ 5,814 $ 5,588 $ 5,407 $ 5,091 Cost method-fair value (2) $ 1,569 $ 1,579 $ 1,511 $ 1,525 $ 1,493 $ 1,600 $ 1,511 $ 1,466 Underlying investment Private equity $ 4,752 $ 4,650 $ 4,333 $ 4,139 $ 4,031 $ 3,839 $ 3,663 $ 3,324 Real estate 1,293 1,296 1,320 1,325 1,281 1,301 1,374 1,399 Other 695 654 553 518 502 448 370 368 Total $ 6,740 $ 6,600 $ 6,206 $ 5,982 $ 5,814 $ 5,588 $ 5,407 $ 5,091 Total Income Accounting basis Cost method $ 47 $ 64 $ 51 $ 37 $ 26 $ 43 $ 47 $ 39 Equity method 246 159 202 83 152 93 79 82 Total $ 293 $ 223 $ 253 $ 120 $ 178 $ 136 $ 126 $ 121 Underlying investment Private equity $ 219 $ 183 $ 209 $ 114 $ 145 $ 112 $ 113 $ 85 Real estate 74 40 44 6 34 23 13 36 Other - - - - (1) 1 - - Total $ 293 $ 223 $ 253 $ 120 $ 178 $ 136 $ 126 $ 121 (1) Approximate cumulative pre-tax appreciation $ 854 $ 858 $ 787 $ 611 $ 511 $ 469 $ 469 $ 408 (2) THE ALLSTATE CORPORATION LIMITED PARTNERSHIP INTERESTS ($ in millions) As of or for the three months ended The fair value of cost method limited partnerships is determined using reported net asset values.

61 • 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 adjusted net income, • valuation changes on embedded derivatives 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 not hedged, after-tax, • business combination expenses and the 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. 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". 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. Adjusted net income is net income applicable to common shareholders, excluding: Net income applicable to common shareholders is the GAAP measure that is most directly comparable to adjusted net income. We use adjusted net 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 service business that may be obscured by the net effect of realized capital gains and losses, valuation changes on embedded derivatives not hedged, business combination expenses and the 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 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, adjusted net 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 adjusted net 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. Business combination expenses are excluded because they are non-recurring in nature and the 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, adjusted net 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 adjusted net 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. Adjusted net income is used by management along with the other components of net income applicable to common shareholders to assess our performance. We use adjusted measures of adjusted net income in incentive compensation. Therefore, we believe it is useful for investors to evaluate net income applicable to common shareholders, adjusted net 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 adjusted net 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 adjusted net income as the denominator. Adjusted net income should not be considered a substitute for net income applicable to common shareholders and does not reflect the overall profitability of our business. A reconciliation of adjusted net income to net income applicable to common shareholders is provided in the schedule, "Contribution to Income". Combined ratio excluding the effect of catastrophes, prior year reserve reestimates and the 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, 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, 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 "Property-Liability Results", "Historical Property-Liability Results", "Allstate Brand Profitability Measures", "Esurance Brand Profitability Measures and Statistics", "Encompass Brand Profitability Measures and Statistics", "Auto Profitability Measures by Brand", "Homeowners Profitability Measures by Brand" and "Other Personal Lines Profitability Measures by Brand", and "SquareTrade Profitability Measures".

62 Definitions of Non-GAAP Measures (continued) 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 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 underlying loss ratio is provided in the schedules "Property-Liability Results", "Historical Property-Liability Results", "Allstate Brand Profitability Measures", "Esurance Brand Profitability Measures and Statistics", "Encompass Brand Profitability Measures and Statistics", "Auto Profitability Measures by Brand", "Homeowners Profitability Measures by Brand" and "Other Personal Lines Profitability Measures by Brand". Adjusted net income return on adjusted equity is a ratio that uses a non-GAAP measure. It is calculated by dividing the rolling 12-month adjusted net income by the equity balance, after excluding the effect of unrealized net capital gains and losses and goodwill. Return on equity is the most directly comparable GAAP measure. We use equity excluding the effect of unrealized net capital gains and losses and goodwill for the denominator as a representation of equity primarily attributable to the Company’s earned and realized business operations. Unrealized net capital gains and losses are excluded because they 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. Goodwill is excluded because it relates to the acquisition purchase price and is not indicative of our underlying business results. We believe it is useful for investors to have adjusted net income return on adjusted equity when evaluating our performance as it represents a reliable, representative and consistent measurement of the company and management’s utilization of capital. Adjusted net income return on adjusted equity should not be considered a substitute for return on equity and does not reflect the overall profitability of our business. A reconciliation of return on equity and adjusted net income return on adjusted equity can be found in the schedules, "Allstate Life Return on Equity", "Allstate Benefits Return on Equity" and "Allstate Annuities Return on Equity". Adjusted net income return on common shareholders' equity is a ratio that uses a non-GAAP measure. It is calculated by dividing the rolling 12-month adjusted net 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 adjusted net income as the numerator for the same reasons we use adjusted net 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 applicable 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 adjusted net 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 adjusted net income return on common shareholders' equity in incentive compensation. Therefore, we believe it is useful for investors to have adjusted net 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 adjusted net 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. Adjusted net 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 adjusted net income return on common shareholders' equity can be found in the schedule, "Return on Common Shareholders' Equity". Adjusted net income, excluding purchase accounting adjustments, is a non-GAAP measure, which is computed as net income (loss) applicable to common shareholders, excluding amortization of purchased intangible assets, after- tax, and realized capital gains and losses, after-tax, and adjusted for the after-tax income statement effects of acquisition-related purchase accounting fair value adjustments to unearned premiums, contractual liability insurance policy premium expenses, and commissions paid to retailers. Net income (loss) applicable to shareholders is the GAAP measure that is most directly comparable to adjusted net income, excluding purchase accounting adjustments. We use adjusted net income, excluding purchase accounting adjustments, as an important measure to evaluate SquareTrade’s results of operations. We believe that the measure provides investors with a valuable measure of SquareTrade’s ongoing performance because it reveals trends that may be obscured by the amortization of purchased intangible assets, the acquisition-related purchase accounting fair value adjustments, and the net effects of realized capital gains and losses. Amortization of purchased intangible assets is excluded because it relates to the acquisition purchase price and is not indicative of our business results or trends. We adjust for the effects of acquisition-related purchase accounting fair value adjustments because they relate to the acquisition and their effects are not indicative of the underlying business results and trends. Realized capital gains and losses 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 SquareTrade’s operations. Adjusted net income, excluding purchase accounting adjustments, highlights the results from ongoing operations and the underlying profitability of our business and is used by management along with the other components of net income applicable to common shareholders to assess our performance. We believe it is useful for investors to evaluate net income applicable to common shareholders, adjusted net income, excluding purchase accounting adjustments, and their components separately and in the aggregate when reviewing and evaluating SquareTrade’s performance. Adjusted net income, excluding purchase accounting adjustments, should not be considered a substitute for net income applicable to common shareholders and does not reflect the overall profitability of our business. A reconciliation of net income (loss) applicable to common shareholders to adjusted net income, excluding purchase accounting adjustments, is provided in the schedule, "SquareTrade Results". 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. 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".