The Allstate Corporation (ALL) 8-K Allstate Reports Strong First Quarter 2012 Earnings

Exhibit 99.2

THE ALLSTATE CORPORATION

Investor Supplement

First Quarter 2012

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, the Current Report on Form 8-K filed on May 2, 2012 (retrospective adoption of deferred acquisition costs “DAC”) and Quarterly Reports on Form 10-Q.  The results of operations for interim periods should not be considered indicative of results to be expected for the full year.

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

The Allstate Corporation adopted new DAC accounting guidance on a retrospective basis as of January 1, 2012.  Accordingly, all prior period balances have been adjusted.  Balances that have changed from previously reported amounts are highlighted in yellow.  A summary of the impact of the retrospective adjustments is on p.48-49.

THE ALLSTATE CORPORATION

Investor Supplement - First Quarter 2012

Table of Contents

	PAGE
Consolidated
Statements of Operations	1
Contribution to Income	2
Revenues	3
Statements of Financial Position	4
Book Value Per Share	5
Return on Shareholders’ Equity	6
Debt to Capital	7
Statements of Cash Flows	8
Analysis of Deferred Policy Acquisition Costs	9
Historical Summary of Consolidated Operating and Financial Position Data	10
Property-Liability Operations
Property-Liability Results	11
Historical Property-Liability Results	12
Underwriting Results by Area of Business	13
Historical Underwriting Results by Area of Business	14
Premiums Written by Market Segment	15
Allstate Protection Market Segment Analysis	16
Allstate Protection Historical Market Segment Analysis	17
Impact of Net Rate Changes Approved on Premiums Written	18
Allstate Brand Standard Auto Loss Ratio of Top 5 States	19
Standard Auto Profitability Measures	20
Non-standard Auto Profitability Measures	21
Auto Profitability Measures	22
Homeowners Profitability Measures	23
Property-Liability Policies in Force	24
Allstate Brand Domestic Operating Measures and Statistics	25
Esurance Brand Profitability Measures and Statistics	26
Homeowners Supplemental Information	27
Effect of Catastrophe Losses on the Combined Ratio	28
Allstate Protection Catastrophe by Size of Event	29
Effect of Prior Year Reserve Reestimates on the Combined Ratio	30
Asbestos and Environmental Reserves	31
Allstate Financial Operations and Reconciliations
Allstate Financial Results	32
Historical Allstate Financial Results	33
Return on Attributed Equity	34
Premiums and Contract Charges	35
Change in Contractholder Funds	36
Analysis of Net Income	37
Allstate Financial Weighted Average Investment Spreads	38
Allstate Financial Supplemental Product Information	39
Corporate and Other Results	40
Investments
Investments	41
Unrealized Net Capital Gains and Losses on Security Portfolio by Type	42
Gross Unrealized Gains and Losses on Fixed Income Securities by Type and Sector	43
Fair Value and Unrealized Net Capital Gains and Losses for Fixed Income Securities by Credit Rating	44
Realized Capital Gains and Losses by Transaction Type	45
Property-Liability Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-tax)	46
Allstate Financial Net Investment Income, Yields and Realized Capital Gains and Losses (Pre-tax)	47
Summary of Retrospective Adjustments for DAC Accounting Adoption	48-49
Definitions of Non-GAAP and Operating Measures	50

THE ALLSTATE CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

($ in millions, except per share data)

		Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
Revenues
Property-liability insurance premiums	$	6,630		$	6,605		$	6,432		$	6,457		$	6,448
Life and annuity premiums and contract charges		553			570			552			547			569
Net investment income		1,011			975			994			1,020			982
Realized capital gains and losses:
Total other-than-temporary impairment losses		(87	)		(128	)		(197	)		(82	)		(156	)
Portion of loss recognized in other comprehensive income		4			4			(6	)		(4	)		(27	)
Net other-than-temporary impairment losses recognized in earnings		(83	)		(124	)		(203	)		(86	)		(183	)
Sales and other realized capital gains and losses		251			210			467			143			279
Total realized capital gains and losses		168			86			264			57			96
Total revenues		8,362			8,236			8,242			8,081			8,095
Costs and expenses
Property-liability insurance claims and claims expense		4,339			4,198			5,132			6,355			4,476
Life and annuity contract benefits		439			430			455			422			454
Interest credited to contractholder funds		378			405			405			417			418
Amortization of deferred policy acquisition costs		979			981			1,046			960			984
Operating costs and expenses		1,017			1,083			888			868			900
Restructuring and related charges		6			16			8			11			9
Interest expense		95			92			92			91			92
Total costs and expenses		7,253			7,205			8,026			9,124			7,333
Gain (loss) on disposition of operations		3			3			3			7			(20	)
Income (loss) from operations before income tax expense (benefit)		1,112			1,034			219			(1,036	)		742
Income tax expense (benefit)		346			322			44			(412	)		218
Net income (loss)	$	766		$	712		$	175		$	(624	)	$	524
Earnings per share:(1)
Net income (loss) per share - Basic	$	1.54		$	1.41		$	0.34		$	(1.19	)	$	0.99
Weighted average shares - Basic		498.7			504.5			512.0			523.1			531.0
Net income (loss) per share - Diluted (2)	$	1.53		$	1.40		$	0.34		$	(1.19	)	$	0.98
Weighted average shares - Diluted (2)		501.5			506.8			514.2			523.1			533.6
Cash dividends declared per share	$	0.22		$	0.21		$	0.21		$	0.21		$	0.21

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

(2)As a result of the net loss for the three-months ended June 30, 2011, weighted average dilutive potential common shares outstanding resulting from 2.1 million stock options and 0.5 million restricted stock units (non-participating) were not included in the computation of diluted earnings per share in that quarter, since inclusion of these securities would have an anti-dilutive effect.

1

THE ALLSTATE CORPORATION

CONTRIBUTION TO INCOME

($ in millions, except per share data)

		Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
Contribution to income
Operating income (loss) before the impact of restructuring and related charges	$	714		$	746		$	85		$	(640	)	$	500
Restructuring and related charges, after-tax		(4	)		(11	)		(5	)		(7	)		(6	)
Operating income (loss) *		710			735			80			(647	)		494
Realized capital gains and losses, after-tax		110			55			170			36			63
Valuation changes on embedded derivatives that are not hedged, after-tax		(6	)		(13	)		(4	)		(3	)		8
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(10	)		(16	)		(65	)		(5	)		(22	)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-			-			-			-			3
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		(9	)		(8	)		(8	)		(10	)		(9	)
Business combination expenses and the amortization of purchased intangible assets, after-tax		(31	)		(42	)		-			-			-
Gain (loss) on disposition of operations, after-tax		2			1			2			5			(13	)
Net income (loss)	$	766		$	712		$	175		$	(624	)	$	524
Income per share - Diluted(1) (2)
Operating income (loss) before the impact of restructuring and related charges	$	1.42		$	1.47		$	0.17		$	(1.22	)	$	0.94
Restructuring and related charges, after-tax		-			(0.02	)		(0.01	)		(0.02	)		(0.01	)
Operating income (loss)		1.42			1.45			0.16			(1.24	)		0.93
Realized capital gains and losses, after-tax		0.22			0.11			0.33			0.07			0.12
Valuation changes on embedded derivatives that are not hedged, after-tax		(0.01	)		(0.03	)		(0.01	)		(0.01	)		0.02
DAC and DSI amortization relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(0.02	)		(0.03	)		(0.13	)		(0.01	)		(0.04	)
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		(0.02	)		(0.02	)		(0.01	)		(0.02	)		(0.02	)
Business combination expenses and the amortization of purchased intangible assets, after-tax		(0.06	)		(0.08	)		-			-			-
Gain (loss) on disposition of operations, after-tax		-			-			-			0.02			(0.03	)
Net income (loss)	$	1.53		$	1.40		$	0.34		$	(1.19	)	$	0.98
Weighted average shares - Diluted		501.5			506.8			514.2			523.1			533.6

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

(2)As a result of the net loss for the three-months ended June 30, 2011, weighted average dilutive potential common shares outstanding resulting from 2.1 million stock options and 0.5 million restricted stock units (non-participating) were not included in the computation of diluted earnings per share in that quarter, since inclusion of these securities would have an anti-dilutive effect.

2

THE ALLSTATE CORPORATION

REVENUES

($ in millions)

		Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
Property-Liability
Property-liability insurance premiums	$	6,630		$	6,605		$	6,432		$	6,457		$	6,448
Net investment income		313			309			298			310			284
Realized capital gains and losses		189			12			24			(8	)		57
Total Property-Liability revenues		7,132			6,926			6,754			6,759			6,789
Allstate Financial
Life and annuity premiums and contract charges		553			570			552			547			569
Net investment income		687			656			682			694			684
Realized capital gains and losses		(21	)		68			219			62			39
Total Allstate Financial revenues		1,219			1,294			1,453			1,303			1,292
Corporate and Other
Service fees (1)		1			2			1			2			2
Net investment income		11			10			14			16			14
Realized capital gains and losses		-			6			21			3			-
Total Corporate and Other revenues before reclassification of services fees		12			18			36			21			16
Reclassification of service fees(1)		(1	)		(2	)		(1	)		(2	)		(2	)
Total Corporate and Other revenues		11			16			35			19			14
Consolidated revenues	$	8,362		$	8,236		$	8,242		$	8,081		$	8,095

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

3

THE ALLSTATE CORPORATION

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

($ in millions)

		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,			March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012		2011		2011		2011		2011			2012			2011			2011			2011			2011
Assets											Liabilities
Investments											Reserve for property-liability insurance
Fixed income securities, at fair value											claims and claims expense	$	20,283		$	20,375		$	20,395		$	20,456		$	19,494
(amortized cost $74,060, $73,379,											Reserve for life-contingent contract benefits		14,296			14,406			14,270			13,751			13,551
$73,935, $76,502 and $79,292)	$	77,223	$	76,113	$	76,394	$	78,414	$	80,242	Contractholder funds		41,603			42,332			43,776			45,078			46,834
Equity securities, at fair value											Unearned premiums		9,888			10,057			10,002			9,727			9,563
(cost $3,430, $4,203, $4,252,											Claim payments outstanding		750			827			960			948			761
$4,329 and $3,792)		3,847		4,363		4,157		4,954		4,437	Other liabilities and accrued expenses		6,490			5,978			6,741			6,204			6,423
Mortgage loans		7,167		7,139		6,956		6,827		6,582	Long-term debt		6,058			5,908			5,907			5,907			5,908
Limited partnership interests		4,637		4,697		4,407		4,400		4,077	Separate Accounts		7,355			6,984			6,791			8,175			8,603
Short-term, at fair value											Total liabilities		106,723			106,867			108,842			110,246			111,137
(amortized cost $1,886, $1,291,
$3,517, $2,536 and $1,986)		1,886		1,291		3,517		2,536		1,986	Equity
Other		2,249		2,015		2,094		2,158		2,287	Common stock, 493 million, 501 million, 505 million,
Total investments		97,009		95,618		97,525		99,289		99,611	517 million and 524 million shares outstanding		9			9			9			9			9
											Additional capital paid-in		3,151			3,189			3,177			3,165			3,156
											Retained income		32,565			31,909			31,303			31,237			31,971
											Deferred ESOP expense		(41	)		(43	)		(43	)		(43	)		(42	)
											Treasury stock, at cost (407 million, 399 million,
											395 million, 383 million and 376 million shares)		(17,034	)		(16,795	)		(16,693	)		(16,387	)		(16,173	)
											Accumulated other comprehensive income:
											Unrealized net capital gains and losses:
											Unrealized net capital losses on fixed income
											securities with other-than-temporary impairments		(100	)		(174	)		(155	)		(156	)		(167	)
											Other unrealized net capital gains and losses		2,412			2,041			1,683			1,783			1,186
Cash		577		776		1,026		693		641	Unrealized adjustment to DAC, DSI and insurance
Premium installment receivables, net		4,908		4,920		4,988		4,869		4,842	reserves		(438	)		(467	)		(463	)		(152	)		53
Deferred policy acquisition costs		3,716		3,871		3,889		4,000		4,113	Total unrealized net capital gains and losses		1,874			1,400			1,065			1,475			1,072
Reinsurance recoverables, net (1)		7,118		7,251		6,720		6,446		6,589	Unrealized foreign currency translation
Accrued investment income		846		826		854		875		885	adjustments		65			56			49			82			78
Deferred income taxes		201		722		991		731		835	Unrecognized pension and other
Property and equipment, net		912		914		908		914		912	postretirement benefit cost		(1,407	)		(1,427	)		(1,135	)		(1,156	)		(1,173	)
Goodwill		1,242		1,242		874		874		874	Total accumulated other comprehensive
Other assets		2,049		2,069		2,037		1,791		2,159	income (loss)		532			29			(21	)		401			(23	)
Separate Accounts		7,355		6,984		6,791		8,175		8,603	Total shareholders’ equity		19,182			18,298			17,732			18,382			18,898
											Noncontrolling interest		28			28			29			29			29
											Total equity		19,210			18,326			17,761			18,411			18,927
Total assets	$	125,933	$	125,193	$	126,603	$	128,657	$	130,064	Total liabilities and equity	$	125,933		$	125,193		$	126,603		$	128,657		$	130,064

(1)Reinsurance recoverables of unpaid losses related to Property-Liability were $2,571 million, $2,588 million, $2,271 million, $2,099 million and $2,134 million as of March 31, 2012, December 31, 2011, September 30, 2011, June 30, 2011 and March 31, 2011, respectively.

4

THE ALLSTATE CORPORATION

BOOK VALUE PER SHARE

($ in millions, except per share data )

		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011
Book value per share
Numerator:
Shareholders’ equity	$	19,182	$	18,298	$	17,732	$	18,382	$	18,898
Denominator:
Shares outstanding and dilutive potential shares outstanding		497.3		505.8		509.0		522.0		529.0
Book value per share	$	38.57	$	36.18	$	34.84	$	35.21	$	35.72
Book value per share, excluding the impact of unrealized net capital gains and losses on fixed income securities *
Numerator:
Shareholders’ equity	$	19,182	$	18,298	$	17,732	$	18,382	$	18,898
Unrealized net capital gains and losses on fixed income securities		1,620		1,311		1,136		1,091		671
Adjusted shareholders’ equity	$	17,562	$	16,987	$	16,596	$	17,291	$	18,227
Denominator:
Shares outstanding and dilutive potential shares outstanding		497.3		505.8		509.0		522.0		529.0
Book value per share, excluding the impact of unrealized net capital gains and losses on fixed income securities	$	35.31	$	33.58	$	32.61	$	33.12	$	34.46

5

THE ALLSTATE CORPORATION

RETURN ON SHAREHOLDERS’ EQUITY

($ in millions)

		Twelve months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
Return on Shareholders’ Equity
Numerator:
Net income (1)	$	1,029		$	787		$	368		$	554		$	1,315
Denominator:
Beginning shareholders’ equity	$	18,898		$	18,617		$	18,887		$	17,619		$	17,104
Ending shareholders’ equity		19,182			18,298			17,732			18,382			18,898
Average shareholders’ equity (2)	$	19,040		$	18,458		$	18,310		$	18,001		$	18,001
Return on shareholders’ equity		5.4	%		4.3	%		2.0	%		3.1	%		7.3		%
Operating Income Return on Shareholders’ Equity *
Numerator:
Operating income (1)	$	878		$	662		$	189		$	555		$	1,632
Denominator:
Beginning shareholders’ equity	$	18,898		$	18,617		$	18,887		$	17,619		$	17,104
Unrealized net capital gains and losses		1,072			948			1,313			312			(145	)
Adjusted beginning shareholders’ equity		17,826			17,669			17,574			17,307			17,249
Ending shareholders’ equity		19,182			18,298			17,732			18,382			18,898
Unrealized net capital gains and losses		1,874			1,400			1,065			1,475			1,072
Adjusted ending shareholders’ equity		17,308			16,898			16,667			16,907			17,826
Average adjusted shareholders’ equity (2)	$	17,567		$	17,284		$	17,121		$	17,107		$	17,538
Operating income return on shareholders’ equity		5.0	%		3.8	%		1.1	%		3.2	%		9.3		%

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

6

THE ALLSTATE CORPORATION

DEBT TO CAPITAL

($ in millions)

		March 31,				Dec. 31,				Sept. 30,				June 30,				March 31,
		2012				2011				2011				2011				2011
Debt
Long-term debt	$	6,058			$	5,908			$	5,907			$	5,907			$	5,908
Capital resources
Debt	$	6,058			$	5,908			$	5,907			$	5,907			$	5,908
Shareholders’ equity
Common stock		9				9				9				9				9
Additional capital paid-in		3,151				3,189				3,177				3,165				3,156
Retained income		32,565				31,909				31,303				31,237				31,971
Deferred ESOP expense		(41	)			(43	)			(43	)			(43	)			(42	)
Treasury stock		(17,034	)			(16,795	)			(16,693	)			(16,387	)			(16,173	)
Unrealized net capital gains and losses		1,874				1,400				1,065				1,475				1,072
Unrealized foreign currency translation adjustments		65				56				49				82				78
Unrecognized pension and other postretirement benefit cost		(1,407	)			(1,427	)			(1,135	)			(1,156	)			(1,173	)
Total shareholders’ equity		19,182				18,298				17,732				18,382				18,898
Total capital resources	$	25,240			$	24,206			$	23,639			$	24,289			$	24,806
Ratio of debt to shareholders’ equity		31.6		%		32.3		%		33.3		%		32.1		%		31.3		%
Ratio of debt to capital resources		24.0		%		24.4		%		25.0		%		24.3		%		23.8		%

7

THE ALLSTATE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

($ in millions)

		Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	766		$	712		$	175		$	(624	)	$	524
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, amortization and other non-cash items		96			103			60			58			31
Realized capital gains and losses		(168	)		(86	)		(264	)		(57	)		(96	)
(Gain) loss on disposition of operations		(3	)		(3	)		(3	)		(7	)		20
Interest credited to contractholder funds		378			405			405			417			418
Changes in:
Policy benefits and other insurance reserves		(346	)		(623	)		(119	)		723			(58	)
Unearned premiums		(180	)		(183	)		307			161			(248	)
Deferred policy acquisition costs		52			48			69			(7	)		67
Premium installment receivables, net		19			191			(136	)		(25	)		3
Reinsurance recoverables, net		57			(441	)		(235	)		77			(117	)
Income taxes		333			316			43			(429	)		203
Other operating assets and liabilities		(197	)		(181	)		109			247			(21	)
Net cash provided by operating activities		807			258			411			534			726
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales
Fixed income securities		5,689			5,520			9,776			5,777			8,363
Equity securities		1,059			896			262			212			642
Limited partnership interests		403			238			427			222			113
Mortgage loans		6			23			9			39			26
Other investments		36			15			40			46			63
Investment collections
Fixed income securities		966			1,087			1,479			1,184			1,201
Mortgage loans		170			143			183			220			88
Other investments		23			18			13			15			77
Investment purchases
Fixed income securities		(7,008	)		(5,996	)		(7,966	)		(3,727	)		(10,207	)
Equity securities		(128	)		(758	)		(285	)		(637	)		(144	)
Limited partnership interests		(318	)		(537	)		(394	)		(431	)		(334	)
Mortgage loans		(216	)		(345	)		(360	)		(510	)		(26	)
Other investments		(163	)		(5	)		(53	)		(88	)		(58	)
Change in short-term investments, net		(379	)		2,118			(1,102	)		(483	)		1,649
Change in other investments, net		(9	)		(58	)		(187	)		(51	)		(119	)
(Acquisition) disposition of operations, net of cash acquired		(1	)		(917	)		2			-			(1	)
Purchases of property and equipment, net		(51	)		(86	)		(54	)		(58	)		(48	)
Net cash provided by investing activities		79			1,356			1,790			1,730			1,285
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of long-term debt		493			7			-			-			-
Repayment of long-term debt		(350	)		(6	)		-			(1	)		-
Contractholder fund deposits		485			570			486			524			596
Contractholder fund withdrawals		(1,299	)		(2,241	)		(1,931	)		(2,386	)		(2,122	)
Dividends paid		(106	)		(108	)		(109	)		(111	)		(107	)
Treasury stock purchases		(309	)		(95	)		(314	)		(239	)		(305	)
Shares reissued under equity incentive plans, net		15			1			1			8			9
Excess tax benefits on share-based payment arrangements		(1	)		(1	)		(1	)		-			(3	)
Other		(13	)		9			-			(7	)		-
Net cash used in financing activities		(1,085	)		(1,864	)		(1,868	)		(2,212	)		(1,932	)
NET (DECREASE) INCREASE IN CASH		(199	)		(250	)		333			52			79
CASH AT BEGINNING OF PERIOD		776			1,026			693			641			562
CASH AT END OF PERIOD	$	577		$	776		$	1,026		$	693		$	641

8

THE ALLSTATE CORPORATION

ANALYSIS OF DEFERRED POLICY ACQUISITION COSTS

($ in millions)

		Change in Deferred Policy Acquisition Costs																					Reconciliation of Deferred Policy
		For the three months ended March 31, 2012																					Acquisition Costs as of March 31, 2012
											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			(charged) credited			capital gains			balance			capital gains			capital gains			capital gains
		Dec. 31, 2011			deferred			adjustments (1) (2)			that are not hedged (2)			to income (2)			and losses			March 31, 2012			and losses			and losses			and losses
Property-Liability	$		1,348	$		845	$		(879)	$		-	$		-	$		-	$		1,314	$		1,314	$		-	$		1,314
Allstate Financial:
Traditional life and accident and health		616			38			(27)			-			-			-			627			627			-			627
Interest-sensitive life		1,698			42			(47)			(2)			-			(17)			1,674			1,909			(235)			1,674
Fixed annuity		209			4			(12)			(13)			-			(87)			101			81			20			101
Sub-total		2,523			84			(86)			(15)			-			(104)			2,402			2,617			(215)			2,402
Consolidated	$		3,871	$		929	$		(965)	$		(15)	$		-	$		(104)	$		3,716	$		3,931	$		(215)	$		3,716
		Change in Deferred Policy Acquisition Costs																					Reconciliation of Deferred Policy
		For the three months ended March 31, 2011																					Acquisition Costs as of March 31, 2011
														Amortization									DAC before						DAC after
											Amortization			(acceleration)			Effect of						impact of			Impact of			impact of
		Beginning			Acquisition			Amortization			relating to realized			deceleration			unrealized			Ending			unrealized			unrealized			unrealized
		balance			costs			before			capital gains and			(charged) credited			capital gains			balance			capital gains			capital gains			capital gains
		Dec. 31, 2010			deferred			adjustments (1) (2)			losses (2)			to income (2)			and losses			March 31, 2011			and losses			and losses			and losses
Property-Liability	$		1,321	$		839	$		(864)	$		-	$		-	$		-	$		1,296	$		1,296	$		-	$		1,296
Allstate Financial:
Traditional life and accident and health		573			30			(23)			-			-			-			580			580			-			580
Interest-sensitive life		1,917			44			(48)			(9)			(12)			(3)			1,889			1,933			(44)			1,889
Fixed annuity		369			6			(12)			(21)			5			1			348			243			105			348
Sub-total		2,859			80			(83)			(30)			(7)			(2)			2,817			2,756			61			2,817
Consolidated	$		4,180	$		919	$		(947)	$		(30)	$		(7)	$		(2)	$		4,113	$		4,052	$		61	$		4,113

(1)	Amortization before adjustments reflects total DAC amortization before amortization/accretion related to realized capital gains and losses, valuation changes on embedded derivatives that are not hedged and amortization acceleration/deceleration charged/credited to income.
(2)	Included as a component of amortization of DAC on the Consolidated Statements of Operations.

9

THE ALLSTATE CORPORATION

HISTORICAL CONSOLIDATED OPERATING

AND FINANCIAL POSITION DATA

($ in millions except per share data)

		As of or for the Year Ended December 31,
		2011			2010			2009			2008			2007
Consolidated statements of operations data:
Insurance premiums and contract charges	$		28,180	$		28,125	$		28,152	$		28,862	$		29,099
Net investment income		3,971			4,102			4,444			5,622			6,435
Realized capital gains and losses		503			(827)			(583)			(5,090)			1,235
Total revenues	$		32,654	$		31,400	$		32,013	$		29,394	$		36,769
Operating income	$		662	$		1,506	$		1,880	$		1,730	$		3,841
Realized capital gains and losses, after-tax		324			(537)			(628)			(3,311)			798
Valuation changes on embedded derivatives that are not hedged, after-tax		(12)			-			-			-			-
DAC and DSI (amortization) accretion relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(108)			(29)			(153)			333			11
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		3			(12)			(219)			(203)			-
Non-recurring items, after-tax (1)		-			-			-			(80)			-
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		(35)			(29)			(2)			(14)			(29)
Business combination expenses and the amortization of purchased intangible assets, after-tax		(42)			-			-			-			-
(Loss) gain on disposition of operations, after-tax		(5)			12			10			3			(2)
Net income (loss)	$		787	$		911	$		888	$		(1,542)	$		4,619
Income per share - Diluted
Operating income	$		1.27	$		2.78	$		3.48	$		3.16	$		6.43
Realized capital gains and losses, after-tax		0.62			(0.99)			(1.16)			(6.04)			1.33
Valuation changes on embedded derivatives that are not hedged, after-tax		(0.02)			-			-			-			-
DAC and DSI (amortization) accretion relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(0.21)			(0.05)			(0.29)			0.61			0.02
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-			(0.02)			(0.41)			(0.37)			-
Non-recurring items, after-tax (1)		-			-			-			(0.15)			-
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		(0.07)			(0.06)			-			(0.02)			(0.05)
Business combination expenses and the amortization of purchased intangible assets, after-tax		(0.08)			-			-			-			-
(Loss) gain on disposition of operations, after-tax		(0.01)			0.02			0.02			-			-
Net income (loss)	$		1.50	$		1.68	$		1.64	$		(2.81)	$		7.73
Net income (loss) per share - Basic	$		1.51	$		1.69	$		1.65	$		(2.81)	$		7.77
Consolidated statements of financial position data:
Investments	$		95,618	$		100,483	$		99,833	$		95,998	$		118,980
Total assets		125,193			130,500			132,209			134,351			155,881
Reserves for claims and claims expense, life-contingent contract benefits and contractholder funds		77,113			81,113			84,659			90,750			94,052
Debt		5,908			5,908			5,910			5,659			5,640
Shareholders’ equity		18,298			18,617			16,184			12,121			21,241
Book value per share		36.18			34.58			29.90			22.51			37.47
Operating ratios:
Annual statutory premiums written to surplus ratio (U.S. property-liability operations)		1.6x			1.6x			1.7x			1.9x			1.5x
Other operating data:
Total employees (excluding agents) (2)		37,300			35,200			36,000			38,500			38,400
Total Allstate agencies and financial representatives (2)		11,900			13,400			14,200			14,700			15,000

(1)

During the fourth quarter of 2008, for traditional life insurance and immediate annuities with life contingencies, an aggregate premium deficiency of $123 million, pre-tax ($80 million, after-tax) resulted primarily from an experience study indicating that the annuitants on certain life-contingent contracts are projected to live longer than we anticipated when the contracts were issued, and, to a lesser degree, a reduction in the related investment portfolio yield. The deficiency was recorded through a reduction in deferred acquisition costs.

(2)

Rounded to the nearest hundred. Represents exclusive Allstate agencies and financial representatives in the United States and Canada.

10

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY RESULTS

($ in millions, except ratios)

	Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
Premiums written *	$		6,463	$		6,426	$		6,728	$		6,611	$		6,215
Decrease (increase) in unearned premiums		167			174			(276)			(165)			234
Other		-			5			(20)			11			(1)
Premiums earned		6,630			6,605			6,432			6,457			6,448
Claims and claims expense		(4,339)			(4,198)			(5,132)			(6,355)			(4,476)
Amortization of deferred policy acquisition costs		(878)			(880)			(866)			(867)			(864)
Operating costs and expenses		(884)			(913)			(735)			(726)			(769)
Restructuring and related charges		(6)			(13)			(8)			(11)			(11)
Underwriting income (loss) *		523			601			(309)			(1,502)			328
Net investment income		313			309			298			310			284
Periodic settlements and accruals on non-hedge derivative instruments		(1)			(3)			(5)			(3)			(4)
Business combination expenses and the amortization of purchased intangible assets		47			49			-			-			-
Income tax (expense) benefit on operations		(281)			(302)			38			463			(181)
Operating income (loss)		601			654			22			(732)			427
Realized capital gains and losses, after-tax		124			7			15			(6)			38
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		1			2			4			1			3
Business combination expenses and the amortization of purchased intangible assets, after-tax		(31)			(32)			-			-			-
Net income (loss)	$		695	$		631	$		41	$		(737)	$		468
Catastrophe losses	$		259	$		66	$		1,077	$		2,339	$		333
Operating ratios *
Claims and claims expense (“loss”) ratio		65.4			63.5			79.8			98.4			69.4
Expense ratio		26.7			27.4			25.0			24.9			25.5
Combined ratio		92.1			90.9			104.8			123.3			94.9
Combined ratio excluding the effect of catastrophes *		88.2			89.9			88.1			87.1			89.7
Effect of catastrophe losses on combined ratio *		3.9			1.0			16.7			36.2			5.2
Combined ratio		92.1			90.9			104.8			123.3			94.9
Combined ratio excluding the effect of catastrophes, prior year reserve reestimates, business combination expenses and the amortization of purchased intangible assets (“underlying”)		88.1			90.7			89.2			87.5			89.9
Effect of catastrophe losses on combined ratio		3.9			1.0			16.7			36.2			5.2
Effect of prior year reserve reestimates on combined ratio *		(3.1)			(2.0)			(1.8)			(0.7)			(0.7)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio		2.5			0.5			0.7			0.3			0.5
Effect of business combination expenses and the amortization of purchased intangible assets on combined ratio*		0.7			0.7			-			-			-
Combined ratio		92.1			90.9			104.8			123.3			94.9
Effect of restructuring and related charges on combined ratio *		0.1			0.2			0.1			0.2			0.2
Effect of Discontinued Lines and Coverages on combined ratio		-			-			0.2			0.1			0.1

11

THE ALLSTATE CORPORATION

HISTORICAL PROPERTY-LIABILITY RESULTS

($ in millions)

		Twelve months ended December 31,
		2011		2010		2009		2008		2007
Premiums written	$	25,980	$	25,907	$	25,971	$	26,584	$	27,183
(Increase) decrease in unearned premium		(33)		19		200		383		17
Other		(5)		31		23		-		33
Premiums earned		25,942		25,957		26,194		26,967		27,233
Claims and claims expense		(20,161)		(18,951)		(18,746)		(20,064)		(17,667)
Amortization of deferred policy acquisition costs		(3,477)		(3,517)		(3,615)		(3,796)		(3,953)
Operating costs and expenses		(3,143)		(2,962)		(2,728)		(2,919)		(2,810)
Restructuring and related charges		(43)		(33)		(105)		(22)		(27)
Underwriting (loss) income		(882)		494		1,000		166		2,776
Net investment income		1,201		1,189		1,328		1,674		1,972
Periodic settlement and accruals on non-hedge derivative instruments		(15)		(7)		(10)		1		-
Business combination expenses and the amortization of purchased intangible assets		49		-		-		-		-
Income tax benefit (expense) on operations		18		(423)		(557)		(401)		(1,410)
Operating income		371		1,253		1,761		1,440		3,338
Realized capital gains and losses, after-tax		54		(207)		(222)		(1,209)		915
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		10		4		7		(1)		-
Business combination expenses and the amortization of purchased intangible assets, after-tax		(32)		-		-		-		-
Gain on disposition of operations, after-tax		-		3		-		-		-
Net income	$	403	$	1,053	$	1,546	$	230	$	4,253
Catastrophe losses	$	3,815	$	2,207	$	2,069	$	3,342	$	1,409
Operating ratios
Loss ratio		77.7		73.0		71.6		74.4		64.9
Expense ratio		25.7		25.1		24.6		25.0		24.9
Combined ratio		103.4		98.1		96.2		99.4		89.8
Combined ratio excluding the effect of catastrophes		88.7		89.6		88.3		87.0		84.6
Effect of catastrophe losses on combined ratio		14.7		8.5		7.9		12.4		5.2
Combined ratio		103.4		98.1		96.2		99.4		89.8
Combined ratio excluding the effect of catastrophes, prior year reserve reestimates, business combination expenses and the amortization of purchased intangible assets (“underlying”)		89.3		89.6		88.1		86.8		85.7
Effect of catastrophe losses on combined ratio		14.7		8.5		7.9		12.4		5.2
Effect of prior year reserve reestimates on combined ratio		(1.3)		(0.6)		(0.4)		0.7		(0.6)
Effect of catastrophe losses included in prior year reserve reestimate on combined ratio		0.5		0.6		0.6		(0.5)		(0.5)
Effect of business combination expenses and the amortization of purchased intangible assets on combined ratio		0.2		-		-		-		-
Combined ratio		103.4		98.1		96.2		99.4		89.8
Effect of restructuring and related charges on combined ratio		0.2		0.1		0.4		0.1		0.1
Effect of Discontinued Lines and
Coverages on the combined ratio		0.1		0.1		0.1		0.1		0.2

12

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY UNDERWRITING RESULTS BY AREA OF BUSINESS

($ in millions)

		Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
Property-Liability Underwriting Summary
Allstate Protection	$	526		$	604		$	(297	)	$	(1,498	)	$	334
Discontinued Lines and Coverages		(3	)		(3	)		(12	)		(4	)		(6	)
Underwriting income (loss)	$	523		$	601		$	(309	)	$	(1,502	)	$	328
Allstate Protection Underwriting Summary
Premiums written	$	6,462		$	6,426		$	6,728		$	6,611		$	6,216
Premiums earned	$	6,630		$	6,604		$	6,432		$	6,457		$	6,449
Claims and claims expense		(4,336	)		(4,195	)		(5,121	)		(6,352	)		(4,472	)
Amortization of deferred policy acquisition costs		(878	)		(880	)		(866	)		(867	)		(864	)
Operating costs and expenses		(884	)		(912	)		(734	)		(725	)		(768	)
Restructuring and related charges		(6	)		(13	)		(8	)		(11	)		(11	)
Underwriting income (loss)	$	526		$	604		$	(297	)	$	(1,498	)	$	334
Catastrophe losses	$	259		$	66		$	1,077		$	2,339		$	333
Operating ratios
Loss ratio		65.4			63.5			79.6			98.4			69.3
Expense ratio		26.7			27.4			25.0			24.8			25.5
Combined ratio		92.1			90.9			104.6			123.2			94.8
Effect of catastrophe losses on combined ratio		3.9			1.0			16.7			36.2			5.2
Effect of restructuring and related charges on combined ratio		0.1			0.2			0.1			0.2			0.2
Effect of business combination expenses and the amortization of purchased intangible assets on combined ratio		0.7			0.7			-			-			-
Discontinued Lines and Coverages Underwriting Summary
Premiums written	$	1		$	-		$	-		$	-		$	(1	)
Premiums earned	$	-		$	1		$	-		$	-		$	(1	)
Claims and claims expense		(3	)		(3	)		(11	)		(3	)		(4	)
Operating costs and expenses		-			(1	)		(1	)		(1	)		(1	)
Underwriting loss	$	(3	)	$	(3	)	$	(12	)	$	(4	)	$	(6	)
Effect of Discontinued Lines and Coverages on the Property-Liability combined ratio		-			-			0.2			0.1			0.1

13

THE ALLSTATE CORPORATION

HISTORICAL PROPERTY-LIABILITY

UNDERWRITING RESULTS BY AREA OF BUSINESS

($ in millions)

		Twelve months ended December 31,
		2011			2010			2009			2008			2007
Property-Liability Underwriting Summary
Allstate Protection	$	(857	)	$	525		$	1,032		$	191		$	2,830
Discontinued Lines and Coverages		(25	)		(31	)		(32	)		(25	)		(54	)
Underwriting (loss) income	$	(882	)	$	494		$	1,000		$	166		$	2,776
Allstate Protection Underwriting Summary
Premiums written	$	25,981		$	25,906		$	25,972		$	26,584		$	27,183
Premiums earned	$	25,942		$	25,955		$	26,195		$	26,967		$	27,232
Claims and claims expense		(20,140	)		(18,923	)		(18,722	)		(20,046	)		(17,620	)
Amortization of deferred policy acquisition costs		(3,477	)		(3,517	)		(3,615	)		(3,796	)		(3,953	)
Operating costs and expenses		(3,139	)		(2,957	)		(2,721	)		(2,912	)		(2,802	)
Restructuring and related charges		(43	)		(33	)		(105	)		(22	)		(27	)
Underwriting (loss) income	$	(857	)	$	525		$	1,032		$	191		$	2,830
Catastrophe losses	$	3,815		$	2,207		$	2,069		$	3,342		$	1,409
Operating ratios
Loss ratio		77.6			72.9			71.5			74.3			64.7
Expense ratio		25.7			25.1			24.6			25.0			24.9
Combined ratio		103.3			98.0			96.1			99.3			89.6
Effect of catastrophe losses on combined ratio		14.7			8.5			7.9			12.4			5.2
Effect of restructuring and related charges on combined ratio		0.2			0.1			0.4			0.1			0.1
Effect of business combination expenses and the amortization of purchased intangible assets on combined ratio		0.2			-			-			-			-
Discontinued Lines and Coverages Underwriting Summary
Premiums written	$	(1	)	$	1		$	(1	)	$	-		$	-
Premiums earned	$	-		$	2		$	(1	)	$	-		$	1
Claims and claims expense		(21	)		(28	)		(24	)		(18	)		(47	)
Operating costs and expenses		(4	)		(5	)		(7	)		(7	)		(8	)
Restructuring and related charges		-			-			-			-			-
Underwriting loss	$	(25	)	$	(31	)	$	(32	)	$	(25	)	$	(54	)
Effect of Discontinued Lines and Coverages on the Property-Liability combined ratio		0.1			0.1			0.1			0.1			0.2

14

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY PREMIUMS WRITTEN BY MARKET SEGMENT

($ in millions)

	Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011
Allstate brand (1)
Standard auto	$	3,937	$	3,812	$	3,996	$	3,911	$	3,984
Non-standard auto		189		174		194		197		210
Auto		4,126		3,986		4,190		4,108		4,194
Involuntary auto		20		17		17		21		19
Commercial lines		112		111		116		125		120
Homeowners		1,258		1,428		1,634		1,606		1,225
Other personal lines		435		446		489		478		413
		5,951		5,988		6,446		6,338		5,971
Encompass brand
Standard auto		142		147		159		154		144
Non-standard auto		-		-		-		-		1
Auto		142		147		159		154		145
Involuntary auto		2		1		2		3		3
Homeowners		85		89		100		94		79
Other personal lines		20		20		21		22		18
		249		257		282		273		245
Esurance brand
Standard auto		262		181		-		-		-
Allstate Protection		6,462		6,426		6,728		6,611		6,216
Discontinued Lines and Coverages		1		-		-		-		(1)
Property-Liability	$	6,463	$	6,426	$	6,728	$	6,611	$	6,215
Allstate Protection
Standard auto	$	4,341	$	4,140	$	4,155	$	4,065	$	4,128
Non-standard auto		189		174		194		197		211
Auto		4,530		4,314		4,349		4,262		4,339
Involuntary auto		22		18		19		24		22
Commercial lines		112		111		116		125		120
Homeowners		1,343		1,517		1,734		1,700		1,304
Other personal lines		455		466		510		500		431
	$	6,462	$	6,426	$	6,728	$	6,611	$	6,216

(1) Emerging Businesses include Business Insurance (commercial products for small business owners), Consumer Household (specialty products including motorcycle, boat, trailers, motor homes, off-road vehicles, renters, landlords, umbrella, manufactured homes and condominium insurance policies), Allstate Dealer Services (insurance and non-insurance products sold primarily to auto dealers), Allstate Roadside Services (roadside assistance products) and Ivantage (insurance agency).  Premiums written by Emerging Businesses totaled $594 million, $582 million, $657 million, $672 million and $575 million for the three months ended  March 31, 2012, December 31, 2011, September 30, 2011, June 30, 2011 and March 31, 2011, respectively.

15

THE ALLSTATE CORPORATION

ALLSTATE PROTECTION MARKET SEGMENT ANALYSIS

($ in millions)

		Three months ended March 31,
		2012		2011		2012		2011		2012		2011		2012		2011	2012	2011	2012	2011	2012		2011		2012	2011	2012
																											Effect of business
																											combination
																											expenses and the
																											amortization of
																			Effect of		Effect of prior year						purchased intangible
										Incurred									catastrophe losses		reserve reestimates						assets on
		Premiums earned				Incurred losses				catastrophe losses				Expenses			Loss ratio  (2)		on combined ratio		on combined ratio				Expense ratio		combined ratio
Allstate brand
Standard auto	$	3,897	$	3,928	$	2,713	$	2,760	$	48	$	18	$	998	$	973	69.6	70.3	1.2	0.5	(1.2	)	(0.4	)	25.6	24.7	-
Non-standard auto		183		210		123		136		-		-		44		48	67.2	64.8	-	-	-		(3.3	)	24.1	22.8	-
Auto		4,080		4,138		2,836		2,896		48		18		1,042		1,021	69.5	70.0	1.2	0.4	(1.2	)	(0.6	)	25.5	24.7	-
Homeowners		1,480		1,448		836		983		186		257		351		340	56.5	67.9	12.6	17.7	(7.9	)	(2.7	)	23.7	23.5	-
Other personal lines (1)		583		588		314		396		17		41		178		203	53.9	67.3	2.9	7.0	(6.7	)	2.6		30.5	34.6	1.2
Total Allstate brand		6,143		6,174		3,986		4,275		251		316		1,571		1,564	64.9	69.2	4.1	5.1	(3.3	)	(0.8	)	25.6	25.4	0.1
Encompass brand
Standard auto		151		160		118		121		1		-		43		45	78.1	75.7	0.7	-	0.7		3.1		28.5	28.1	-
Non-standard auto		-		1		-		1		-		-		-		1	-	100.0	-	-	-		-		-	100.0	-
Auto		151		161		118		122		1		-		43		46	78.1	75.8	0.7	-	0.7		3.1		28.5	28.5	-
Homeowners		92		91		51		60		6		15		28		28	55.4	65.9	6.5	16.5	(2.2	)	1.1		30.5	30.8	-
Other personal lines (1)		23		23		20		15		-		2		5		5	87.0	65.2	-	8.7	(4.3	)	(8.7	)	21.7	21.8	-
Total Encompass brand		266		275		189		197		7		17		76		79	71.0	71.7	2.6	6.2	(0.8	)	1.5		28.6	28.7	-
Esurance brand (3)
Standard auto		221		-		161		-		1		-		121		-	72.8	-	0.4	-	-		-		54.8	-	18.1
Allstate Protection (3)	$	6,630	$	6,449	$	4,336	$	4,472	$	259	$	333	$	1,768	$	1,643	65.4	69.3	3.9	5.2	(3.1	)	(0.7	)	26.7	25.5	0.7

(1)Other personal lines includes commercial, condominium, renters, involuntary auto and other personal lines.

(2)Ratios are calculated using the premiums earned for the respective line of business.

(3)Esurance advertising expense in the first quarter of 2012 had a 20.4 point impact on the Esurance brand expense ratio and a 0.7 point impact on the Allstate Protection expense ratio.

16

THE ALLSTATE CORPORATION

ALLSTATE PROTECTION HISTORICAL MARKET SEGMENT ANALYSIS

($ in millions)

		Three months ended						Three months ended						Three months ended					Three months ended
		March 31, 2012						December 31, 2011						September 30, 2011					June 30, 2011
						Effect of						Effect of
						bus. comb.						bus. comb.
						expenses and						expenses and
				Effect of		the amort.				Effect of		the amort.				Effect of					Effect of
				CAT losses		of purchased				CAT losses		of purchased				CAT losses					CAT losses
		Premiums	Loss	on combined	Expense	intangibles on		Premiums	Loss	on combined	Expense	intangibles on		Premiums	Loss	on combined	Expense		Premiums	Loss	on combined	Expense
		earned	ratio	ratio	ratio	combined ratio		earned	ratio	ratio	ratio	combined ratio		earned	ratio	ratio	ratio		earned	ratio	ratio	ratio
Allstate brand
Standard auto	$	3,897	69.6	1.2	25.6	-	$	3,897	69.6	0.2	25.9	-	$	3,916	69.3	2.9	24.8	$	3,938	73.2	6.7	25.1
Non-standard auto		183	67.2	-	24.1	-		186	59.1	-	26.4	-		196	57.1	0.5	24.5		205	69.3	3.9	22.9
Auto		4,080	69.5	1.2	25.5	-		4,083	69.1	0.2	25.9	-		4,112	68.7	2.7	24.8		4,143	73.0	6.6	25.0
Homeowners		1,480	56.5	12.6	23.7	-		1,468	44.8	3.5	25.2	-		1,462	108.6	55.8	23.3		1,457	171.1	123.2	22.2
Other personal lines (1)		583	53.9	2.9	30.5	1.2		587	59.8	(0.9)	36.1	1.2		590	76.3	13.1	28.3		587	100.5	35.3	27.9
Total Allstate brand		6,143	64.9	4.1	25.6	0.1		6,138	62.4	0.9	26.7	0.1		6,164	78.9	16.3	24.8		6,187	98.7	36.8	24.6
Encompass brand
Standard auto		151	78.1	0.7	28.5	-		151	85.4	0.7	29.2	-		154	87.6	3.2	28.6		155	78.7	3.2	28.4
Non-standard auto		-	-	-	-	-		-	-	-	-	-		-	-	-	-		1	100.0	-	-
Auto		151	78.1	0.7	28.5	-		151	85.4	0.7	29.2	-		154	88.3	3.2	29.2		156	78.9	3.2	28.2
Homeowners		92	55.4	6.5	30.5	-		92	60.9	10.9	31.5	-		91	119.8	70.3	30.7		91	107.7	61.5	30.8
Other personal lines (1)		23	87.0	-	21.7	-		22	100.0	4.5	22.7	-		23	65.2	8.7	26.1		23	104.3	17.4	30.5
Total Encompass brand		266	71.0	2.6	28.6	-		265	78.1	4.5	29.4	-		268	97.0	26.5	29.5		270	90.7	24.1	29.3
Esurance brand
Standard auto		221	72.8	0.4	54.8	18.1		201	78.1	-	43.8	20.9		-	-	-	-		-	-	-	-
Allstate Protection	$	6,630	65.4	3.9	26.7	0.7	$	6,604	63.5	1.0	27.4	0.7	$	6,432	79.6	16.7	25.0	$	6,457	98.4	36.2	24.8
		Three months ended						Three months ended						Three months ended					Three months ended
		March 31, 2011						December 31, 2010						September 30, 2010					June 30, 2010
				Effect of						Effect of						Effect of					Effect of
				CAT losses						CAT losses						CAT losses					CAT losses
		Premiums	Loss	on combined	Expense			Premiums	Loss	on combined	Expense			Premiums	Loss	on combined	Expense		Premiums	Loss	on combined	Expense
		earned	ratio	ratio	ratio			earned	ratio	ratio	ratio			earned	ratio	ratio	ratio		earned	ratio	ratio	ratio
Allstate brand
Standard auto	$	3,928	70.3	0.5	24.7		$	3,941	74.6	0.8	25.1		$	3,961	68.7	0.4	24.6	$	3,969	70.1	2.0	24.5
Non-standard auto		210	64.8	-	22.8			216	69.4	0.5	17.6			222	61.7	-	27.5		228	68.9	0.4	26.3
Auto		4,138	70.0	0.4	24.7			4,157	74.4	0.8	24.7			4,183	68.4	0.4	24.6		4,197	70.1	1.9	24.5
Homeowners		1,448	67.9	17.7	23.5			1,431	77.8	30.3	24.2			1,430	80.5	23.1	24.3		1,416	82.6	34.7	21.8
Other personal lines (1)		588	67.3	7.0	34.6			573	75.2	9.1	33.9			591	61.4	4.4	27.3		592	65.7	8.3	28.2
Total Allstate brand		6,174	69.2	5.1	25.4			6,161	75.2	8.4	25.5			6,204	70.5	6.0	24.8		6,205	72.5	10.0	24.3
Encompass brand
Standard auto		160	75.7	-	28.1			164	76.2	1.2	28.1			173	75.7	0.6	30.7		185	73.0	0.5	27.0
Non-standard auto		1	100.0	-	100.0			1	100.0	-	100.0			2	100.0	-	50.0		2	100.0	-	50.0
Auto		161	75.8	-	28.5			165	76.3	1.2	28.5			175	76.0	0.6	30.9		187	73.2	0.5	27.3
Homeowners		91	65.9	16.5	30.8			93	64.5	16.1	30.1			96	63.5	13.5	32.3		96	64.6	15.6	30.2
Other personal lines (1)		23	65.2	8.7	21.8			22	77.3	4.5	22.7			23	60.9	-	26.1		25	64.0	-	24.0
Total Encompass brand		275	71.7	6.2	28.7			280	72.5	6.4	28.6			294	70.7	4.8	31.0		308	69.8	5.2	27.9
Esurance brand
Standard auto		-	-	-	-			-	-	-	-			-	-	-	-		-	-	-	-
Allstate Protection	$	6,449	69.3	5.2	25.5		$	6,441	75.1	8.3	25.6		$	6,498	70.5	5.9	25.1	$	6,513	72.4	9.8	24.4

(1)Other personal lines includes commercial, condominium, renters, involuntary auto and other personal lines.

17

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

IMPACT OF NET RATE CHANGES APPROVED ON PREMIUMS WRITTEN

	Three months ended				Three months ended				Three months ended
	March 31, 2012 (1)				December 31, 2011				September 30, 2011
	Number of			State	Number of			State	Number of			State
	states		Countrywide (%) (4)	specific (%) (5)	states		Countrywide (%) (4)	specific (%) (5)	states		Countrywide (%) (4)	specific (%) (5)
Allstate brand
Standard auto (2)	10		0.5	5.8	12	(11)	0.7	3.9	10	(10)	0.9	7.3
Non-standard auto	4		0.2	1.4	5	(6)	1.1	6.5	3		0.9	11.5
Auto	13		0.5	5.5	16	(6)	0.8	4.0	13		0.9	7.4
Homeowners (3)	13		2.0	7.9	17		2.9	7.8	15		2.3	13.9
Encompass brand
Standard auto	2		0.1	3.2	7		1.8	6.5	8		0.7	3.9
Non-standard auto	-		-	-	-		-	-	-		-	-
Auto	2		0.1	3.2	7		1.8	6.5	8		0.7	3.9
Homeowners	5		0.9	5.3	8		0.8	4.6	7		0.7	3.0
Esurance brand
Standard auto	6		1.3	4.8	n/a		n/a	n/a	-		-	-
	Three months ended				Three months ended
	June 30, 2011				March 31, 2011
	Number of			State	Number of			State
	states		Countrywide (%) (4)	specific (%) (5)	states		Countrywide (%) (4)	specific (%) (5)
Allstate brand
Standard auto (2)	18	(9)	1.9	5.3	13	(7)(8)	1.1	4.1
Non-standard auto	3		0.4	6.1	3		3.6	18.4
Auto	18		1.9	5.3	15		1.3	4.7
Homeowners (3)	18		1.5	6.0	12	(6)	1.8	9.9
Encompass brand
Standard auto	3		0.3	4.0	3		0.6	5.0
Non-standard auto	-		-	-	-		-	-
Auto	3		0.3	4.0	3		0.6	5.0
Homeowners	11	(6)	0.3	2.6	5		1.2	4.9
Esurance brand
Standard auto	-		-	-	-		-	-

(1)	Rate changes include changes approved based on our net cost of reinsurance. These rate changes do not reflect initial rates filed for insurance subsidiaries initially writing business. Based on historical premiums written in those states, rate changes approved for the three month period ending March 31, 2012 are estimated to total $218 million. Rate changes do not include rating plan enhancements, including the introduction of discounts and surcharges, that result in no change in the overall rate level in the state. Rate changes also exclude Company’s Canadian operations, specialty auto, and excess and surplus homeowners lines.
(2)	Impacts of Allstate brand standard auto effective rate changes as a percentage of total countrywide prior year-end premiums written were 0.4%, 1.2% 1.6%, 0.5% and 1.4% for the three months ended March 31, 2012, December 31, 2011, September 30, 2011, June 30, 2011 and March 31, 2011, respectively.
(3)	Impacts of Allstate brand homeowners effective rate changes as a percentage of total countrywide prior year-end premiums written were 3.6%, 2.6%, 1.1%, 1.2% and 2.9% for the three months ended March 31, 2012, December 31, 2011, September 30, 2011, June 30, 2011 and March 31, 2011, respectively.
(4)	Represents the impact in the states where rate changes were approved during the year as a percentage of total countrywide prior year-end premiums written.
(5)	Represents the impact in the states where rate changes were approved during the year as a percentage of its respective total prior year-end premiums written in those states.
(6)	Includes Washington, D.C.
(7)	Includes targeted rate decreases in certain markets to improve our competitive position for target customers (multi-car residence owners).
(8)	Includes the impact of a 20.9% and 2.3% rate increases in Florida and a 12.0% rate increase in New York in the first quarter of 2011.
(9)	Includes the impact of a 20.0% and 6.0% rate increases in Florida and a 3.7% rate increase in New York in the second quarter of 2011.
(10)	Includes the impact of a 9.9% average rate increase in New York in the third quarter of 2011.
(11)	Includes the impact of a 8.0% rate increase in Florida and a 1.2% rate increase in New York in the fourth quarter of 2011.
n/a	Not available.

18

THE ALLSTATE CORPORATION

ALLSTATE BRAND STANDARD AUTO LOSS RATIO OF TOP 5 STATES

($ in millions)

	Three months ended						Twelve months ended December 31,
		March 31	Dec. 31	Sept. 30	June 30	March 31
		2012	2011	2011	2011	2011	2011	2010	2009	2008	2007
Allstate brand standard auto loss ratio (1)
California		78.4	75.3	73.9	67.9	75.1	73.0	74.9	76.8	70.1	65.7
Florida		71.3	68.6	70.4	73.6	77.3	72.6	83.9	75.3	76.6	66.4
New York		65.2	78.4	83.9	68.2	80.1	77.6	87.2	81.0	75.4	70.7
Pennsylvania		72.7	70.4	70.0	74.9	71.3	71.6	68.6	66.5	61.1	65.3
Texas		74.5	61.9	64.8	75.0	60.7	65.6	60.0	64.9	67.1	70.2
All other states & Canada		67.6	68.3	66.0	74.7	67.6	69.1	66.2	65.6	65.8	64.2
Total Allstate brand standard auto		69.6	69.6	69.3	73.2	70.3	70.6	70.7	69.3	68.1	65.8

(1)Loss ratios include prior year reserve reestimates.

19

THE ALLSTATE CORPORATION

STANDARD AUTO PROFITABILITY MEASURES

		Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,			March 31,
($ in millions)		2012		2011		2011		2011			2011
Standard auto
Net premiums written
Allstate brand	$	3,937	$	3,812	$	3,996	$	3,911		$	3,984
Encompass brand		142		147		159		154			144
Esurance brand		262		181		-		-			-
		4,341		4,140		4,155		4,065			4,128
Net premiums earned
Allstate brand	$	3,897	$	3,897	$	3,916	$	3,938		$	3,928
Encompass brand		151		151		154		155			160
Esurance brand		221		201		-		-			-
		4,269		4,249		4,070		4,093			4,088
Incurred losses
Allstate brand	$	2,713	$	2,713	$	2,712	$	2,882		$	2,760
Encompass brand		118		129		135		122			121
Esurance brand		161		157		-		-			-
		2,992		2,999		2,847		3,004			2,881
Expenses
Allstate brand	$	998	$	1,008	$	973	$	989		$	973
Encompass brand		43		44		44		44			45
Esurance brand		121		88		-		-			-
		1,162		1,140		1,017		1,033			1,018
Underwriting Income
Allstate brand	$	186	$	176	$	231	$	67	��	$	195
Encompass brand		(10)		(22)		(25)		(11)			(6)
Esurance brand		(61)		(44)		-		-			-
		115		110		206		56			189
Loss ratio
Allstate brand		69.6		69.6		69.3		73.2			70.3
Encompass brand		78.1		85.4		87.6		78.7			75.7
Esurance brand		72.8		78.1		-		-			-
Allstate Protection		70.1		70.6		70.0		73.4			70.5
Expense ratio
Allstate brand		25.6		25.9		24.8		25.1			24.7
Encompass brand		28.5		29.2		28.6		28.4			28.1
Esurance brand		54.8		43.8		-		-			-
Allstate Protection		27.2		26.8		24.9		25.2			24.9
Combined ratio
Allstate brand		95.2		95.5		94.1		98.3			95.0
Encompass brand		106.6		114.6		116.2		107.1			103.8
Esurance brand		127.6		121.9		-		-			-
Allstate Protection		97.3		97.4		94.9		98.6			95.4
Effect of catastrophe losses on combined ratio
Allstate brand		1.2		0.2		2.9		6.7			0.5
Encompass brand		0.7		0.7		3.2		3.2			-
Esurance brand		0.4		-		-		-			-
Effect of prior year reserve reestimates on combined ratio
Allstate brand		(1.2)		(3.2)		(3.3)		(2.2)			(0.4)
Encompass brand		0.7		-		6.5		-			3.1
Esurance brand		-		-		-		-			-
Effect of business combination expenses and the amortization of purchased intangible assets on combined ratio
Esurance brand		18.1		20.9		-		-			-
Allstate brand combined ratio excluding the effect of catastrophes and prior year reserve reestimates (“underlying”)		94.9		98.4		94.4		93.7			94.8
Effect of catastrophe losses on combined ratio		1.2		0.2		2.9		6.7			0.5
Effect of prior year reserve reestimates on combined ratio		(1.2)		(3.2)		(3.3)		(2.2)			(0.4)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio		0.3		0.1		0.1		0.1			0.1
Allstate brand combined ratio		95.2		95.5		94.1		98.3			95.0

20

THE ALLSTATE CORPORATION

NON-STANDARD AUTO PROFITABILITY MEASURES

	Three months ended
		March 31,		Dec. 31,			Sept. 30,			June 30,			March 31,
($ in millions)		2012		2011			2011			2011			2011
Non-standard auto
Net premiums written
Allstate brand	$	189	$	174		$	194		$	197		$	210
Encompass brand		-		-			-			-			1
		189		174			194			197			211
Net premiums earned
Allstate brand	$	183	$	186		$	196		$	205		$	210
Encompass brand		-		-			-			1			1
		183		186			196			206			211
Incurred losses
Allstate brand	$	123	$	110		$	112		$	142		$	136
Encompass brand		-		-			1			1			1
		123		110			113			143			137
Expenses
Allstate brand	$	44	$	49		$	48		$	47		$	48
Encompass brand		-		-			1			-			1
		44		49			49			47			49
Underwriting Income
Allstate brand	$	16	$	27		$	36		$	16		$	26
Encompass brand		-		-			(2	)		-			(1	)
		16		27			34			16			25
Loss ratio
Allstate brand		67.2		59.1			57.1			69.3			64.8
Encompass brand		-		-			-			100.0			100.0
Allstate Protection		67.2		59.1			57.7			69.4			64.9
Expense ratio
Allstate brand		24.1		26.4			24.5			22.9			22.8
Encompass brand		-		-			-			-			100.0
Allstate Protection		24.1		26.4			25.0			22.8			23.3
Combined ratio
Allstate brand		91.3		85.5			81.6			92.2			87.6
Encompass brand		-		-			-			100.0			200.0
Allstate Protection		91.3		85.5			82.7			92.2			88.2
Effect of catastrophe losses on combined ratio
Allstate brand		-		-			0.5			3.9			-
Encompass brand		-		-			-			-			-
Effect of prior year reserve reestimates on combined ratio
Allstate brand		-		(7.0	)		(8.7	)		(1.0	)		(3.3	)
Encompass brand		-		-			-			(100.0	)		-

21

THE ALLSTATE CORPORATION

AUTO PROFITABILITY MEASURES

	Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
($ in millions)		2012			2011			2011			2011			2011
Auto
Net premiums written
Allstate brand	$	4,126		$	3,986		$	4,190		$	4,108		$	4,194
Encompass brand		142			147			159			154			145
Esurance brand		262			181			-			-			-
		4,530			4,314			4,349			4,262			4,339
Net premiums earned
Allstate brand	$	4,080		$	4,083		$	4,112		$	4,143		$	4,138
Encompass brand		151			151			154			156			161
Esurance brand		221			201			-			-			-
		4,452			4,435			4,266			4,299			4,299
Incurred losses
Allstate brand	$	2,836		$	2,823		$	2,824		$	3,024		$	2,896
Encompass brand		118			129			136			123			122
Esurance brand		161			157			-			-			-
		3,115			3,109			2,960			3,147			3,018
Expenses
Allstate brand	$	1,042		$	1,057		$	1,021		$	1,036		$	1,021
Encompass brand		43			44			45			44			46
Esurance brand		121			88			-			-			-
		1,206			1,189			1,066			1,080			1,067
Underwriting Income
Allstate brand	$	202		$	203		$	267		$	83		$	221
Encompass brand		(10	)		(22	)		(27	)		(11	)		(7	)
Esurance brand		(61	)		(44	)		-			-			-
		131			137			240			72			214
Loss ratio
Allstate brand		69.5			69.1			68.7			73.0			70.0
Encompass brand		78.1			85.4			88.3			78.9			75.8
Esurance brand		72.8			78.1			-			-			-
Allstate Protection		70.0			70.1			69.4			73.2			70.2
Expense ratio
Allstate brand		25.5			25.9			24.8			25.0			24.7
Encompass brand		28.5			29.2			29.2			28.2			28.5
Esurance brand		54.8			43.8			-			-			-
Allstate Protection		27.1			26.8			25.0			25.1			24.8
Combined ratio
Allstate brand		95.0			95.0			93.5			98.0			94.7
Encompass brand		106.6			114.6			117.5			107.1			104.3
Esurance brand		127.6			121.9			-			-			-
Allstate Protection		97.1			96.9			94.4			98.3			95.0
Effect of catastrophe losses on combined ratio
Allstate brand		1.2			0.2			2.7			6.6			0.4
Encompass brand		0.7			0.7			3.2			3.2			-
Esurance brand		0.4			-			-			-			-
Effect of prior year reserve reestimates on combined ratio
Allstate brand		(1.2	)		(3.3	)		(3.6	)		(2.1	)		(0.6	)
Encompass brand		0.7			-			6.5			(0.6	)		3.1
Esurance brand		-			-			-			-			-
Effect of business combination expenses and the amortization
of purchased intangible assets on combined ratio
Esurance brand		18.1			20.9			-			-			-

22

THE ALLSTATE CORPORATION

HOMEOWNERS PROFITABILITY MEASURES

	Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
($ in millions)		2012			2011			2011			2011			2011
Homeowners
Net premiums written
Allstate brand	$	1,258		$	1,428		$	1,634		$	1,606		$	1,225
Encompass brand		85			89			100			94			79
		1,343			1,517			1,734			1,700			1,304
Net premiums earned
Allstate brand	$	1,480		$	1,468		$	1,462		$	1,457		$	1,448
Encompass brand		92			92			91			91			91
		1,572			1,560			1,553			1,548			1,539
Incurred losses
Allstate brand	$	836		$	657		$	1,587		$	2,493		$	983
Encompass brand		51			56			109			98			60
		887			713			1,696			2,591			1,043
Expenses
Allstate brand	$	351		$	370		$	341		$	324		$	340
Encompass brand		28			29			28			28			28
	��	379			399			369			352			368
Underwriting Income
Allstate brand	$	293		$	441		$	(466	)	$	(1,360	)	$	125
Encompass brand		13			7			(46	)		(35	)		3
		306			448			(512	)		(1,395	)		128
Loss ratio
Allstate brand		56.5			44.8			108.6			171.1			67.9
Encompass brand		55.4			60.9			119.8			107.7			65.9
Allstate Protection		56.4			45.7			109.2			167.4			67.7
Expense ratio
Allstate brand		23.7			25.2			23.3			22.2			23.5
Encompass brand		30.5			31.5			30.7			30.8			30.8
Allstate Protection		24.1			25.6			23.8			22.7			24.0
Combined ratio
Allstate brand		80.2			70.0			131.9			193.3			91.4
Encompass brand		85.9			92.4			150.5			138.5			96.7
Allstate Protection		80.5			71.3			133.0			190.1			91.7
Effect of catastrophe losses on combined ratio
Allstate brand		12.6			3.5			55.8			123.2			17.7
Encompass brand		6.5			10.9			70.3			61.5			16.5
Effect of prior year reserve reestimates on combined ratio
Allstate brand		(7.9	)		(2.4	)		-			0.3			(2.7	)
Encompass brand		(2.2	)		5.4			(4.4	)		(1.1	)		1.1
Allstate brand combined ratio excluding the effect of catastrophes and prior year reserve reestimates (“underlying”)		67.0			67.0			73.3			69.4			74.0
Effect of catastrophe losses on combined ratio		12.6			3.5			55.8			123.2			17.7
Effect of prior year reserve reestimates on combined ratio		(7.9	)		(2.4	)		-			0.3			(2.7	)
Effect of catastrophe losses included in prior year reserve reestimates on combined ratio		8.5			1.9			2.8			0.4			2.4
Allstate brand combined ratio		80.2			70.0			131.9			193.3			91.4

23

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

PROPERTY-LIABILITY POLICIES IN FORCE

	Three months ended
		March 31,	Dec. 31,	Sept. 30,	June 30,	March 31,
		2012	2011	2011	2011	2011
Policies in Force (in thousands) (1)
Allstate brand
Standard auto		17,080	17,213	17,286	17,420	17,456
Non-standard auto		570	571	599	599	627
Auto		17,650	17,784	17,885	18,019	18,083
Homeowners (2)		6,259	6,369	6,459	6,555	6,631
Emerging Businesses (3)
Specialty auto		976	966	972	957	914
Specialty property		3,899	3,905	3,901	3,877	3,849
Business Insurance		281	286	292	299	301
Allstate Roadside Services		1,045	1,043	1,029	1,045	1,039
Canada		938	924	911	899	882
Involuntary auto		28	28	32	39	42
Excess and surplus (2)		9	-	-	-	-
Total Allstate brand		31,085	31,305	31,481	31,690	31,741
Encompass brand
Standard auto		676	673	671	672	676
Non-standard auto		-	-	1	3	4
Homeowners		309	306	306	307	310
Specialty auto		21	21	21	21	21
Specialty property		111	111	111	111	112
Involuntary auto		5	5	6	7	7
Total Encompass brand		1,122	1,116	1,116	1,121	1,130
Esurance brand standard auto		849	786	-	-	-
Total Policies in Force		33,056	33,207	32,597	32,811	32,871

(1)	Policies in Force: Policy counts are based on items rather than customers. A multi-car customer would generate multiple item (policy) counts, even if all cars were insured under one policy. Allstate Dealer Services (insurance and non-insurance products sold primarily to auto dealers), Ivantage (insurance agency), Answer Financial (independent insurance agency) and Partnership Marketing Group (roadside assistance partners) statistics are not included in total policies in force since these are not meaningful measurements.
(2)	Beginning in first quarter 2012, excess and surplus lines policies in force are reported separately. Previously, these policy counts were included in the homeowners total. Excess and surplus lines represent policies written by North Light Specialty Insurance Company.
(3)	Emerging Businesses policies in force include statistics for Consumer Household (specialty products including motorcycle, boat, trailers, motor homes, off-road vehicles, renters, landlords, umbrella, manufactured homes and condominium insurance policies), Business Insurance (commercial products for small business owners) and Allstate Roadside Services (roadside assistance products sold by Allstate Motor Club).

24

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

ALLSTATE BRAND DOMESTIC OPERATING MEASURES AND STATISTICS (1)

	Three months ended
	March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
	2012		2011		2011		2011		2011
Good Hands Roadside Members (in thousands)	569		390		129		75		25
New Issued Applications (in thousands) (2)
Standard auto	463		451		466		472		519
Non-standard auto	79		58		61		59		78
Auto	542		509		527		531		597
Homeowners	101		103		116		123		114
Average Premium - Gross Written ($) (3)
Standard auto	447		450		446		442		439
Non-standard auto	598		598		586		620		621
Auto	452		455		451		448		446
Homeowners	1,065		1,031		1,001		989		975
Average Premium - Net Earned ($) (4)
Standard auto	431		428		429		429		430
Non-standard auto	542		533		533		573		579
Auto	434		432		432		434		435
Homeowners	904		890		871		856		844
Renewal Ratio (%) (5)
Standard auto	88.7		88.8		89.1		89.2		88.9
Non-standard auto	69.1		69.7		70.6		70.8		70.4
Auto	88.0		88.0		88.4		88.5		88.1
Homeowners	87.4		88.1		88.4		88.4		88.3
Bodily Injury Claim Frequency
(% change year-over-year)
Standard auto	(2.1	)	(3.5	)	(3.3	)	(2.3	)	3.1
Non-standard auto	(1.0	)	(0.3	)	(5.9	)	(2.4	)	2.3
Auto	(2.5	)	(3.8	)	(3.9	)	(2.7	)	2.7
Property Damage Claim Frequency
(% change year-over-year)
Standard auto	(4.1	)	(2.6	)	(2.6	)	(3.9	)	1.2
Non-standard auto	(1.2	)	1.1		(2.7	)	(1.8	)	0.5
Auto	(4.3	)	(2.7	)	(2.9	)	(4.0	)	0.9
Auto Paid Severity
(% change year-over-year)
Bodily injury	1.2		1.9		0.2		0.4		3.6
Property damage	4.6		5.8		1.0		1.1		0.8
Homeowners Excluding Catastrophe Losses
(% change year-over-year)
Claim frequency	(4.8	)	4.5		6.0		(0.8	)	1.7
Claim severity	(0.4	)	(1.9	)	3.3		3.4		3.5

(1)	Measures and statistics presented for Allstate brand exclude the Company’s Canadian operations and specialty auto.
(2)	New Issued Applications: Item counts of automobiles or homeowners insurance applications for insurance policies that were issued during the period. Does not include automobiles that are added by existing customers.
(3)	Average Premium - Gross Written: Gross premiums written divided by issued item count. Gross premiums written include the impacts from discounts and surcharges; and exclude the impacts from mid-term premium adjustments, ceded reinsurance premiums, and premium refund accruals. Average premiums represent the appropriate policy term for each line, which is 6 months for auto and 12 months for homeowners.
(4)	Average Premium - Net Earned: Earned premium divided by average policies in force for the period. Earned premium includes the impacts from mid-term premium adjustments and ceded reinsurance, but does not include impacts of premium refund accruals. Average premiums represent the appropriate policy term for each line, which is 6 months for auto and 12 months for homeowners.
(5)	Renewal ratio: Renewal policies issued during the period, based on contract effective dates, divided by the total policies issued 6 months prior for auto or 12 months prior for homeowners.

25

THE ALLSTATE CORPORATION

ESURANCE BRAND PROFITABILITY MEASURES AND STATISTICS

	Three months ended
		March 31,			Dec. 31,(1)
($ in millions)		2012			2011
Net premiums written	$	262		$	181
Net premiums earned	$	221		$	201
Incurred losses
Incurred non-catastrophe losses	$	160		$	157
Incurred catastrophe losses		1			-
Prior year reserve reestimates		-			-
	$	161		$	157
Expenses
Business combination expenses and amortization of
purchased intangible assets	$	40		$	42
Advertising expenses		45			22
Other expenses		36			24
	$	121		$	88
Underwriting Loss	$	(61	)	$	(44	)
Loss ratio		72.8			78.1
Expense ratio		54.8			43.8
Combined ratio		127.6			121.9
Effect of catastrophe losses on combined ratio		0.4			-
Effect of prior year reserve reestimates on combined ratio		-			-
Effect of business combination expenses and the amortization of purchased intangible assets on combined ratio		18.1			20.9
Effect of advertising expenses on combined ratio		20.4			10.9
Esurance brand combined ratio excluding the effect of catastrophes, prior year reserve reestimates, business combination expenses, and the amortization of purchased intangible assets (“underlying”)		109.1			101.0
Effect of catastrophe losses		0.4			-
Effect of prior year non-catastrophe reserve reestimates		-			-
Effect of business combination expense and the amortization of purchased intangible assets		18.1			20.9
Esurance brand combined ratio		127.6			121.9
Policies in Force (in thousands)		849			786
Renewal Ratio (%)		78.5			76.3
Impact of Esurance brand on Allstate Protection combined ratio		0.9			0.7
Impact of Esurance brand on Allstate Protection expense ratio		1.8			1.3

(1)  Represents period from October 7, 2011 to December, 31, 2011.

26

THE ALLSTATE CORPORATION

HOMEOWNERS SUPPLEMENTAL INFORMATION

($ in millions)

		Three months ended March 31, 2012
										Premium rate changes (3)
Primary Exposure Groupings(1)		Earned premiums		Incurred losses	Loss ratios		Catastrophe losses	Effect of catastrophes on loss ratio	Number of catastrophes	Number of states	Annual impact of rate changes on state specific premiums written
Florida	$	27	$	17	63.0%	$	1	3.7%
Other hurricane exposure states		810		441	54.4%		111	13.7%
Total hurricane exposure states (2)		837		458	54.7%		112	13.4%		9	7.8%
Other catastrophe exposure states		735		429	58.4%		80	10.9%		7	7.8%
Total	$	1,572	$	887	56.4%	$	192	12.2%	15	16	7.8%

(1) Basis of Presentation

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

(2) Hurricane Exposure States

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

(3) Premium Rate Changes

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

27

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

EFFECT OF CATASTROPHE LOSSES ON THE COMBINED RATIO

($ in millions, except ratios)

										Excludes the effect of catastrophe losses relating to earthquakes and hurricanes
	Effect of all catastrophe losses on the Property-Liability combined ratio					Premiums earned		Total catastrophe		Total catastrophe		Effect on the Property-Liability
	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year	year-to-date		losses by year		losses by year		combined ratio
1992 (3)	3.2	7.1	48.7	25.5	21.2	$	15,542	$	3,301	$	680	4.4
1993 (3)	5.8	3.0	1.2	3.8	3.4	16,039		547		607		3.8
1994 (3)	27.4	4.4	9.5	7.3	12.0	16,513		1,989		529		3.2
1995	4.0	7.8	3.8	5.0	5.2	17,540		905		683		3.9
1996	5.1	6.0	6.4	3.8	5.4	18,366		983		837		4.6
1997	2.4	2.6	2.6	0.3	2.0	18,604		365		325		1.7
1998	2.5	6.3	3.9	3.4	4.0	19,307		780		615		3.2
1999	2.6	5.6	5.4	2.7	4.1	20,112		816		623		3.1
2000	7.0	6.7	1.7	2.3	4.4	21,871		967		930		4.3
2001	1.5	9.8	2.5	2.4	4.0	22,197		894		763		3.4
2002	1.9	5.0	1.6	4.0	3.1	23,361		731		638		2.7
2003	2.2	9.2	6.1	6.5	6.0	24,677		1,489		1,256		5.1
2004	1.6	3.8	26.0	6.2	9.5	25,989		2,468		467		1.8
2005	2.5	2.2	69.4	9.6	21.0	27,039		5,674		460		1.7
2006	1.6	3.7	2.5	4.1	3.0	27,369		810		1,044		3.8
2007	2.4	6.3	5.0	7.0	5.2	27,233		1,409		1,336		4.9
2008	8.4	10.3	26.8	3.9	12.4	26,967		3,342		1,876		7.0
2009	7.8	12.5	6.2	5.0	7.9	26,194		2,069		2,159		8.2
2010	10.0	9.8	5.9	8.3	8.5	25,957		2,207		2,272		8.8
2011	5.2	36.2	16.7	1.0	14.7	25,942		3,815		3,298		12.7
2012	3.9	-	-	-	3.9	6,630		259		284		4.3
Average (2)	4.9	8.3	13.1	5.4	7.9							4.8
	Excludes the effect of catastrophe losses relating to
	Hurricane Andrew, California Earthquakes,					Premiums		Total
	and Hawaii Hurricanes (1)					earned		catastrophe
	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year	year-to-date		losses by year
1992 (3)	3.2	7.0	4.5	2.9	4.4	$	15,542	$	681
1993 (3)	5.6	3.0	1.5	5.1	3.8	16,039		607
1994 (3)	5.1	3.8	1.7	2.5	3.2	16,513		535
1995	4.0	7.7	1.8	5.0	4.6	17,540		843
1996	5.1	6.0	6.4	3.8	5.4	18,366		991
1997	2.4	2.6	1.8	0.3	1.8	18,604		329
1998	2.0	6.3	3.9	2.2	3.6	19,307		695
1999	2.6	5.6	5.4	2.3	3.9	20,112		790
2000	7.0	6.7	1.5	1.8	4.3	21,871		930
2001	1.5	8.1	2.5	1.7	3.5	22,197		769
2002	1.8	5.0	1.6	3.6	3.0	23,361		706
2003	2.1	9.0	6.1	6.4	5.9	24,677		1,458
2004	1.6	3.8	26.0	6.2	9.5	25,989		2,468
2005	2.5	2.2	69.4	9.6	21.0	27,039		5,674
2006	1.6	3.7	2.5	4.1	3.0	27,369		810
2007	2.4	6.3	5.0	7.0	5.2	27,233		1,409
2008	8.4	10.3	26.8	3.9	12.4	26,967		3,342
2009	7.8	12.5	6.2	5.0	7.9	26,194		2,069
2010	10.0	9.8	5.9	8.3	8.5	25,957		2,207
2011	5.2	36.2	16.7	1.0	14.7	25,942		3,815
2012	3.9	-	-	-	3.9	6,630		259
Average (2)	4.1	8.2	11.2	4.3	6.9

(1)        The effect of Catastrophe losses on the combined ratio is presented excluding the effects of those events for which the exposure is now covered by an industry reinsurance or insurance mechanism (i.e., Florida Hurricane Catastrophe Fund and California Earthquake Authority) or with Hawaii hurricanes, coverage is being brokered to a non-affiliated insurance company (see the “Commitments, Guarantees and Contingent Liabilities” footnote to the Consolidated Financial Statements).

(2)        The effect of Catastrophes and Catastrophes excluding extraordinary catastrophes on the Combined Ratio calculated as an average for all periods since 1992.

(3)        The years 1992-1994 have been adjusted to exclude the premiums earned of the PMI Group, a mortgage guarantee insurer that was sold in 1995.

28

THE ALLSTATE CORPORATION

ALLSTATE PROTECTION CATASTROPHE BY SIZE OF EVENT

($ in millions, except ratios)

Three months ended March 31, 2012
										Average
	Number				Claim and			Combined		catastrophe
Size of catastrophe	of events				claim expense			ratio impact		loss per event
Greater than $250 million	-	-	%	$	-	-	%	-	$	-
$101 million to $250 million	1	6.7			161	62.2		2.5		161
$50 million to $100 million	1	6.7			94	36.3		1.4		94
Less than $50 million	13	86.6			165	63.7		2.5		13
Total	15	100.0	%		420	162.2		6.4		28
Prior year reserve reestimates					(161)	(62.2)		(2.5)
Prior quarter reserve reestimates					-	-		-
Total catastrophe losses				$	259	100.0	%	3.9

29

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

EFFECT OF PRIOR YEAR RESERVE REESTIMATES ON THE COMBINED RATIO

($ in millions, except ratios)

	Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011
Prior Year Reserve Reestimates (1)
Auto	$	(48)	$	(136)	$	(136)	$	(90)	$	(19)
Homeowners		(119)		(30)		(4)		3		(38)
Other personal lines		(40)		33		12		36		13
Allstate Protection (2)		(207)		(133)		(128)		(51)		(44)
Discontinued Lines and Coverages		3		3		11		4		3
Property-Liability	$	(204)	$	(130)	$	(117)	$	(47)	$	(41)
Allstate brand	$	(205)	$	(142)	$	(132)	$	(49)	$	(48)
Encompass brand		(2)		9		4		(2)		4
Esurance brand		-		-		-		-		-
Allstate Protection (2)	$	(207)	$	(133)	$	(128)	$	(51)	$	(44)
Effect of Prior Year Reserve
Reestimates on Combined Ratio (1)
Auto		(0.7)		(2.1)		(2.1)		(1.4)		(0.3)
Homeowners		(1.8)		(0.4)		(0.1)		-		(0.6)
Other personal lines		(0.6)		0.5		0.2		0.6		0.2
Allstate Protection (2)		(3.1)		(2.0)		(2.0)		(0.8)		(0.7)
Discontinued Lines and Coverages		-		-		0.2		0.1		-
Property-Liability		(3.1)		(2.0)		(1.8)		(0.7)		(0.7)
Allstate brand		(3.1)		(2.1)		(2.1)		(0.8)		(0.8)
Encompass brand		-		0.1		0.1		-		0.1
Esurance brand		-		-		-		-		-
Allstate Protection (2)		(3.1)		(2.0)		(2.0)		(0.8)		(0.7)

(1)Favorable reserve reestimates are shown in parentheses.

(2)Favorable reserve reestimates included in catastrophe losses totaled $161 million and $34 million in the three months ended March 31, 2012 and 2011, respectively.

30

THE ALLSTATE CORPORATION

ASBESTOS AND ENVIRONMENTAL RESERVES

($ in millions)

		Three months			Twelve months ended December 31,
		ended
		March 31,
		2012			2011			2010			2009			2008			2007
(net of reinsurance)
Asbestos claims
Beginning reserves	$	1,078		$	1,100		$	1,180		$	1,228		$	1,302		$	1,375
Incurred claims and claims expense		-			26			5			(8	)		8			17
Claims and claims expense paid		(28	)		(48	)		(85	)		(40	)		(82	)		(90	)
Ending reserves	$	1,050		$	1,078		$	1,100		$	1,180		$	1,228		$	1,302
Claims and claims expense paid as a percent of ending reserves		2.7%			4.5%			7.7%			3.4%			6.7%			6.9%
Environmental claims
Beginning reserves	$	185		$	201		$	198		$	195		$	232		$	194
Incurred claims and claims expense		-			-			18			13			-			63
Claims and claims expense paid		(2	)		(16	)		(15	)		(10	)		(37	)		(25	)
Ending reserves	$	183		$	185		$	201		$	198		$	195		$	232
Claims and claims expense paid as a percent of ending reserves		1.1%			8.6%			7.5%			5.1%			19.0%			10.8%

31

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL RESULTS

($ in millions)

	Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011
Investments	$	57,620	$	57,373	$	59,068	$	59,659	$	60,484
Premiums	$	287	$	305	$	287	$	286	$	312
Contract charges		266		265		265		261		257
Net investment income		687		656		682		694		684
Periodic settlements and accruals on non- hedge derivative instruments		15		16		18		19		17
Contract benefits		(439)		(430)		(455)		(422)		(454)
Interest credited to contractholder funds		(368)		(385)		(395)		(412)		(425)
Amortization of deferred policy acquisition costs		(86)		(78)		(83)		(87)		(95)
Operating costs and expenses		(142)		(159)		(129)		(135)		(132)
Restructuring and related charges		-		(3)		-		-		2
Income tax expense on operations		(70)		(57)		(61)		(69)		(53)
Operating income		150		130		129		135		113
Realized capital gains and losses, after-tax		(14)		43		142		40		25
Valuation changes on embedded derivatives that are not hedged, after-tax		(6)		(13)		(4)		(3)		8
DAC and DSI (amortization) accretion relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(10)		(16)		(65)		(5)		(22)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		-		-		-		3
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		(10)		(10)		(12)		(11)		(12)
Gain (loss) on disposition of operations, after-tax		2		1		2		5		(13)
Net income	$	112	$	135	$	192	$	161	$	102

32

THE ALLSTATE CORPORATION

HISTORICAL ALLSTATE FINANCIAL RESULTS

($ in millions)

		As of or for the Year Ended December 31,
		2011			2010			2009			2008			2007
Investments	$	57,373		$	61,582		$	62,216		$	61,449		$	74,256
Premiums		1,190			1,138			969			943			870
Contract charges		1,048			1,030			989			952			996
Net investment income		2,716			2,853			3,064			3,811			4,297
Periodic settlements and accruals on non-hedge derivative instruments		70			51			14			20			46
Contract benefits		(1,761	)		(1,815	)		(1,617	)		(1,612	)		(1,589	)
Interest credited to contractholder funds		(1,617	)		(1,798	)		(2,038	)		(2,417	)		(2,682	)
Amortization of deferred policy acquisition costs		(343	)		(236	)		(337	)		(440	)		(501	)
Operating costs and expenses		(555	)		(568	)		(535	)		(657	)		(567	)
Restructuring and related charges		(1	)		3			(25	)		(1	)		(2	)
Income tax expense on operations		(240	)		(214	)		(148	)		(191	)		(270	)
Operating income		507			444			336			408			598
Realized capital gains and losses, after-tax		250			(337	)		(417	)		(2,034	)		(125	)
Valuation changes on embedded derivatives that are not hedged, after-tax		(12	)		-			-			-			-
DAC and DSI (amortization) accretion relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(108	)		(29	)		(153	)		333			11
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		3			(12	)		(219	)		(203	)		-
Non-recurring items, after-tax (1)		-			-			-			(80	)		-
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		(45	)		(33	)		(9	)		(13	)		(29	)
(Loss) gain on disposition of operations, after-tax		(5	)		9			10			3			(2	)
Net income (loss)	$	590		$	42		$	(452	)	$	(1,586	)	$	453
Life insurance in force, net of reinsurance	$	306,397		$	294,149		$	281,961		$	280,042		$	271,035

(1) During the fourth quarter of 2008, for traditional life insurance and immediate annuities with life contingencies, an aggregate premium deficiency of $123 million, pre-tax ($80 million, after-tax) resulted primarily from an experience study indicating that the annuitants on certain life-contingent contracts are projected to live longer than we anticipated when the contracts were issued, and, to a lesser degree, a reduction in the related investment portfolio yield.  The deficiency was recorded through a reduction in deferred acquisition costs.

33

ALLSTATE FINANCIAL

RETURN ON ATTRIBUTED EQUITY

($ in millions)

	Twelve months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
Return on Attributed Equity
Numerator:
Net income (1)	$	600		$	590		$	527		$	417		$	141
Denominator:
Beginning attributed equity (2)	$	6,568		$	6,385		$	6,450		$	5,895		$	5,510
Ending attributed equity		7,475			7,230			7,044			6,868			6,568
Average attributed equity (3)	$	7,022		$	6,808		$	6,747		$	6,382		$	6,039
Return on attributed equity		8.5	%		8.7	%		7.8	%		6.5	%		2.3	%
Operating Income Return on Attributed Equity
Numerator:
Operating income (1)	$	544		$	507		$	472		$	447		$	426
Denominator:
Beginning attributed equity	$	6,568		$	6,385		$	6,450		$	5,895		$	5,510
Unrealized net capital gains and losses		656			548			685			183			(316)
Adjusted beginning attributed equity		5,912			5,837			5,765			5,712			5,826
Ending attributed equity		7,475			7,230			7,044			6,868			6,568
Unrealized net capital gains and losses		1,073			842			776			792			656
Adjusted ending attributed equity		6,402			6,388			6,268			6,076			5,912
Average adjusted attributed equity (3)	$	6,157		$	6,113		$	6,017		$	5,894		$	5,869
Operating income return on attributed equity		8.8	%		8.3	%		7.8	%		7.6	%		7.3	%

(1)	Net income and operating income reflect a trailing twelve-month period.
(2)	Allstate Financial attributed equity is the sum of equity for Allstate Life Insurance Company, the applicable equity for American Heritage Life Investment Corporation, and the equity for Allstate Bank.
(3)	Average attributed equity and average adjusted attributed equity are determined using a two-point average, with the beginning and ending attributed equity and adjusted attributed equity, respectively, for the twelve-month period as data points.

34

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL PREMIUMS AND CONTRACT CHARGES

($ in millions)

	Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011
PREMIUMS AND CONTRACT CHARGES -
BY PRODUCT
Underwritten Products
Traditional life insurance premiums	$	113	$	113	$	111	$	109	$	108
Accident and health insurance premiums		162		160		160		162		161
Interest-sensitive life insurance contract charges		260		256		258		253		248
		535		529		529		524		517
Annuities
Immediate annuities with life contingencies premiums		12		32		16		15		43
Other fixed annuity contract charges		6		9		7		8		9
		18		41		23		23		52
Total	$	553	$	570	$	552	$	547	$	569
PREMIUMS AND CONTRACT CHARGES -
BY DISTRIBUTION CHANNEL
Allstate agencies (1)	$	266	$	264	$	260	$	256	$	251
Workplace enrolling agents		170		171		171		169		168
Other		117		135		121		122		150
Total	$	553	$	570	$	552	$	547	$	569
ISSUED LIFE INSURANCE POLICIES BY
DISTRIBUTION CHANNEL(2)(3)
Allstate agencies (1)		29,714		45,053		30,006		29,794		25,709
Other		876		812		885		931		981
Total		30,590		45,865		30,891		30,725		26,690

(1)	Includes products directly sold through call centers and internet.
(2)	Excludes Allstate Benefits and non-proprietary products.
(3)	To conform to current period presentation, certain amounts in the prior periods have been reclassified.

35

THE ALLSTATE CORPORATION

CHANGE IN CONTRACTHOLDER FUNDS

($ in millions)

	Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011
Beginning balance	$	42,332	$	43,776	$	45,078	$	46,834	$	48,195
Deposits
Fixed annuities		153		228		133		142		164
Interest-sensitive life insurance		332		324		321		316		330
Bank deposits		-		19		32		97		212
Total deposits		485		571		486		555		706
Interest credited		379		406		400		413		410
Maturities, benefits, withdrawals and other adjustments
Maturities of and interest payments on institutional products		(1)		(48)		(26)		(306)		(487)
Benefits		(357)		(326)		(396)		(367)		(372)
Surrenders and partial withdrawals		(943)		(1,052)		(1,351)		(1,513)		(1,019)
Bank withdrawals		-		(817)		(162)		(210)		(274)
Contract charges		(264)		(265)		(257)		(255)		(251)
Net transfers from separate accounts		2		3		3		3		3
Fair value hedge adjustments for institutional products		-		-		-		-		(34)
Other adjustments		(30)		84		1		(76)		(43)
Total maturities, benefits, withdrawals and other adjustments		(1,593)		(2,421)		(2,188)		(2,724)		(2,477)
Ending balance	$	41,603	$	42,332	$	43,776	$	45,078	$	46,834

36

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL ANALYSIS OF NET INCOME

($ in millions)

	Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011
Benefit spread
Premiums	$	287	$	305	$	287	$	286	$	312
Cost of insurance contract charges (1)		170		168		167		162		162
Contract benefits excluding the implied interest on immediate annuities with life contingencies (2)		(305)		(294)		(320)		(287)		(319)
Total benefit spread		152		179		134		161		155
Investment spread
Net investment income		687		656		682		694		684
Implied interest on immediate annuities with life contingencies (2)		(134)		(136)		(135)		(135)		(135)
Interest credited to contractholder funds		(378)		(405)		(405)		(417)		(418)
Total investment spread		175		115		142		142		131
Surrender charges and contract maintenance expense fees (1)		96		97		98		99		95
Realized capital gains and losses		(21)		68		219		62		39
Amortization of deferred policy acquisition costs		(101)		(101)		(180)		(93)		(120)
Operating costs and expenses		(142)		(159)		(129)		(135)		(132)
Restructuring and related charges		-		(3)		-		-		2
Gain (loss) on disposition of operations		3		2		4		7		(20)
Income tax expense		(50)		(63)		(96)		(82)		(48)
Net income	$	112	$	135	$	192	$	161	$	102
Benefit spread by product group
Life insurance	$	91	$	74	$	90	$	98	$	93
Accident and health insurance		73		114		70		71		74
Annuities		(12)		(9)		(26)		(8)		(12)
Total benefit spread	$	152	$	179	$	134	$	161	$	155
Investment spread by product group
Annuities and institutional products	$	87	$	23	$	48	$	51	$	48
Life insurance		18		12		17		14		11
Allstate Bank products		-		2		6		6		8
Accident and health insurance		6		5		4		5		5
Net investment income on investments supporting capital		64		73		67		66		59
Total investment spread	$	175	$	115	$	142	$	142	$	131
(1) Reconciliation of contract charges
Cost of insurance contract charges	$	170	$	168	$	167	$	162	$	162
Surrender charges and contract maintenance expense fees		96		97		98		99		95
Total contract charges	$	266	$	265	$	265	$	261	$	257
(2) Reconciliation of contract benefits
Contract benefits excluding the implied interest on immediate annuities with life contingencies	$	(305)	$	(294)	$	(320)	$	(287)	$	(319)
Implied interest on immediate annuities with life contingencies		(134)		(136)		(135)		(135)		(135)
Total contract benefits	$	(439)	$	(430)	$	(455)	$	(422)	$	(454)

37

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL WEIGHTED AVERAGE INVESTMENT SPREADS

	Three months ended March 31, 2012						Three months ended March 31, 2011
	Weighted average		Weighted average		Weighted average		Weighted average		Weighted average		Weighted average
	investment yield		interest crediting rate		investment spreads		investment yield		interest crediting rate		investment spreads
Interest-sensitive life insurance	5.4	%	4.1	%	1.3	%	5.4	%	4.2	%	1.2	%
Deferred fixed annuities and institutional products	4.5		3.2		1.3		4.5		3.3		1.2
Immediate fixed annuities with and without life contingencies	7.8		6.1		1.7		6.2		6.2		-
Investments supporting capital, traditional life and other products	3.9		n/a		n/a		3.7		n/a		n/a

38

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL SUPPLEMENTAL PRODUCT INFORMATION

($ in millions)

		As of March 31, 2012				Twelve months ended March 31, 2012
				Attributed equity
		Reserves and		excluding unrealized		Operating	Operating income return
		Contractholder funds		capital gains/losses (3)(4)		income (5)	on attributed equity
Life insurance	$	14,053	$	2,430	$	258	11.3	%
Accident and health insurance		1,901		634		94	15.5
Annuities and institutional and bank products:
Deferred Annuities		24,879		2,025		183	9.2
Immediate Annuities:
Sub-standard structured settlements and group pension terminations (1)		5,144		845		(14)	(1.7)
Standard structured settlements and SPIA (2)		7,974		410		24	7.4
Institutional products		1,948		58		(5)	(7.3)
Bank		-		-		4	NM
Sub-total		39,945		3,338		192	5.9
Total Allstate Financial	$	55,899	$	6,402	$	544	8.8

		Three months ended March 31, 2012
		Life		Accident and		Annuities and		Allstate
		insurance		health insurance		institutional products		Financial
Operating income	$	64	$	17	$	69	$	150
Realized capital gains and losses, after-tax		(5)		-		(9)		(14)
Valuation changes on embedded derivatives that are not hedged, after-tax		-		-		(6)		(6)
DAC and DSI (amortization) accretion relating to realized capital gains and losses and valuation changes on embedded derivatives that are not hedged, after-tax		(2)		-		(8)		(10)
DAC and DSI unlocking relating to realized capital gains and losses, after-tax		-		-		-		-
Reclassification of periodic settlements and accruals on non-hedge derivative instruments, after-tax		-		-		(10)		(10)
Loss on disposition of operations, after-tax		-		-		2		2
Net income	$	57	$	17	$	38	$	112

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

39

THE ALLSTATE CORPORATION

CORPORATE AND OTHER RESULTS

($ in millions)

	Three months ended
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011
Net investment income	$	11	$	10	$	14	$	16	$	14
Operating costs and expenses		(86)		(88)		(116)		(98)		(91)
Income tax benefit on operations		34		29		31		32		31
Operating loss		(41)		(49)		(71)		(50)		(46)
Business combination expenses, after-tax		-		(10)		-		-		-
Realized capital gains and losses, after-tax		-		5		13		2		-
Net loss	$	(41)	$	(54)	$	(58)	$	(48)	$	(46)

40

THE ALLSTATE CORPORATION

INVESTMENTS

($ in millions)

	PROPERTY-LIABILITY										ALLSTATE FINANCIAL
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,
		2012		2011		2011		2011		2011		2012		2011		2011		2011		2011
Fixed income securities, at fair value:
Tax-exempt	$	7,634	$	8,239	$	8,799	$	8,778	$	8,942	$	37	$	38	$	38	$	40	$	61
Taxable		21,272		19,562		18,203		18,726		19,126		46,232		46,252		46,829		47,821		49,117
Equity securities, at fair value		3,636		4,165		3,977		4,748		4,199		211		198		180		206		238
Mortgage loans		494		474		377		132		16		6,673		6,665		6,579		6,695		6,566
Limited partnership interests		2,889		3,055		2,863		2,913		2,684		1,729		1,612		1,508		1,449		1,358
Short-term, at fair value		608		451		719		770		473		681		645		1,908		1,342		874
Other		192		52		68		52		17		2,057		1,963		2,026		2,106		2,270
Total	$	36,725	$	35,998	$	35,006	$	36,119	$	35,457	$	57,620	$	57,373	$	59,068	$	59,659	$	60,484
Fixed income securities, at amortized cost:
Tax-exempt	$	7,350	$	7,935	$	8,568	$	8,650	$	8,981	$	36	$	37	$	37	$	39	$	59
Taxable		20,742		19,188		17,942		18,456		19,076		43,936		44,259		44,931		46,380		48,224
Ratio of fair value to amortized cost		102.9%		102.5%		101.9%		101.5%		100.0%		105.2%		104.5%		104.2%		103.1%		101.9%
Equity securities, at cost	$	3,270	$	4,044	$	4,094	$	4,170	$	3,616	$	160	$	159	$	158	$	159	$	176
Short-term, at amortized cost		608		451		719		770		473		681		645		1,908		1,342		874
	CORPORATE AND OTHER										CONSOLIDATED
		March 31,		Dec. 31,		Sept. 30,		June 30,		March 31,		March 31,		Dec. 31,		Sept 30,		June 30,		March 31,
		2012		2011		2011		2011		2011		2012		2011		2011		2011		2011
Fixed income securities, at fair value:
Tax-exempt	$	748	$	728	$	732	$	698	$	706	$	8,419	$	9,005	$	9,569	$	9,516	$	9,709
Taxable		1,300		1,294		1,793		2,351		2,290		68,804		67,108		66,825		68,898		70,533
Equity securities, at fair value		-		-		-		-		-		3,847		4,363		4,157		4,954		4,437
Mortgage loans		-		-		-		-		-		7,167		7,139		6,956		6,827		6,582
Limited partnership interests		19		30		36		38		35		4,637		4,697		4,407		4,400		4,077
Short-term, at fair value		597		195		890		424		639		1,886		1,291		3,517		2,536		1,986
Other		-		-		-		-		-		2,249		2,015		2,094		2,158		2,287
Total	$	2,664	$	2,247	$	3,451	$	3,511	$	3,670	$	97,009	$	95,618	$	97,525	$	99,289	$	99,611
Fixed income securities, at amortized cost:
Tax-exempt	$	714	$	689	$	698	$	670	$	684	$	8,100	$	8,661	$	9,303	$	9,359		$9,724
Taxable		1,282		1,271		1,759		2,307		2,268		65,960		64,718		64,632		67,143		69,568
Ratio of fair value to amortized cost		102.6%		103.2%		102.8%		102.4%		101.5%		104.3%		103.7%		103.3%		102.5%		101.2%
Equity securities, at cost	$	-	$	-	$	-	$	-	$	-	$	3,430	$	4,203	$	4,252	$	4,329	$	3,792
Short-term, at amortized cost		597		195		890		424		639		1,886		1,291		3,517		2,536		1,986

41

THE ALLSTATE CORPORATION

UNREALIZED NET CAPITAL GAINS AND LOSSES ON SECURITY PORTFOLIO BY TYPE

($ in millions)

		March 31, 2012					December 31, 2011					September 30, 2011
		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	$	282	$	5,541	105.4	$	349	$	6,315	105.8	$	337	$	4,346	108.4
Municipal		644		13,614	105.0		607		14,241	104.5		554		14,999	103.8
Corporate		2,512		46,331	105.7		2,364		43,581	105.7		2,194		44,529	105.2
Foreign government		195		1,989	110.9		215		2,081	111.5		192		2,133	109.9
Residential mortgage-backed securities (“RMBS”)		(231)		3,728	94.2		(411)		4,121	90.9		(395)		4,632	92.1
Commercial mortgage-backed securities (“CMBS”)		(111)		1,753	94.0		(178)		1,784	90.9		(221)		1,824	89.2
Asset-backed securities (“ABS”)		(130)		4,242	97.0		(214)		3,966	94.9		(204)		3,906	95.0
Redeemable preferred stock		2		25	108.7		2		24	109.1		2		25	108.7
Total fixed income securities		3,163		77,223	104.3		2,734		76,113	103.7		2,459		76,394	103.3
Equity securities		417		3,847	112.2		160		4,363	103.8		(95)		4,157	97.8
Short-term investments		-		1,886	100.0		-		1,291	100.0		-		3,517	100.0
Derivatives		(21)		273	92.9		(17)		168	90.8		(15)		244	94.2
EMA limited partnership interests (2)		1		n/a	n/a		2		n/a	n/a		7		n/a	n/a
Unrealized net capital gains and losses, pre-tax	$	3,560	$	83,229	104.5	$	2,879	$	81,935	103.6	$	2,356	$	84,312	102.9
Amounts recognized for:
Insurance reserves (3)		(443)					(594)					(603)
DAC and DSI (4)		(230)					(124)					(109)
Amounts recognized		(673)					(718)					(712)
Deferred income taxes		(1,013)					(761)					(579)
Unrealized net capital gains and losses, after-tax	$	1,874				$	1,400				$	1,065
		June 30, 2011					March 31, 2011					December 31, 2010
		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	$	315	$	6,187	105.4	$	257	$	6,766	103.9	$	276	$	8,596	103.3
Municipal		116		14,673	100.8		(254)		15,246	98.4		(267)		15,934	98.4
Corporate		1,759		42,369	104.3		1,300		42,395	103.2		1,395		37,655	103.8
Foreign government		323		3,043	111.9		295		3,117	110.5		337		3,158	111.9
RMBS		(366)		5,990	94.2		(377)		6,530	94.5		(516)		7,993	93.9
CMBS		(97)		1,986	95.3		(103)		2,053	95.2		(219)		1,994	90.1
ABS		(139)		4,142	96.8		(169)		4,111	96.1		(181)		4,244	95.9
Redeemable preferred stock		1		24	104.3		1		24	104.3		1		38	102.7
Total fixed income securities		1,912		78,414	102.5		950		80,242	101.2		826		79,612	101.0
Equity securities		625		4,954	114.4		645		4,437	117.0		583		4,811	113.8
Short-term investments		-		2,536	100.0		-		1,986	100.0		-		3,279	100.0
Derivatives		(36)		348	90.6		(30)		512	94.5		(22)		439	95.2
EMA limited partnership interests (2)		7		n/a	n/a		7		n/a	n/a		-		n/a	n/a
Unrealized net capital gains and losses, pre-tax	$	2,508	$	86,252	103.0	$	1,572	$	87,177	101.8	$	1,387	$	88,141	101.6
Amounts recognized for:
Insurance reserves (3)		(181)					(1)					(9)
DAC and DSI (4)		(53)					83					85
Amounts recognized		(234)					82					76
Deferred income taxes		(799)					(582)					(515)
Unrealized net capital gains and losses, after-tax	$	1,475				$	1,072				$	948

(1)	The comparison of percentages from period to period may be distorted by investment transactions such as sales, purchases and impairment write-downs.
(2)	Unrealized net capital gains and losses for limited partnership interest represent the Company’s share of Equity Method of Accounting (“EMA”) limited partnerships’ other comprehensive income. Fair value and amortized cost are not applicable.
(3)	The insurance reserves adjustment represents the amount by which the reserve balance would increase if the net unrealized gains in the applicable product portfolios were realized and reinvested at current lower interest rates, resulting in a premium deficiency. Although we evaluate premium deficiencies on the combined performance of our life insurance and immediate annuities with life contingencies, the adjustment primarily relates to structured settlement annuities with life contingencies, in addition to annuity buy-outs and certain payout annuities with life contingencies.
(4)	The DAC and DSI adjustment balance represents the amount by which the amortization of DAC and DSI would increase or decrease if the unrealized gains or losses in the respective product portfolios were realized.

42

THE ALLSTATE CORPORATION

FAIR VALUE AND UNREALIZED NET CAPITAL GAINS AND LOSSES FOR FIXED INCOME SECURITIES BY CREDIT RATING

($ in millions)

		As of March 31, 2012
		Aaa				Aa				A				Baa				Ba or lower				Total
		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized		Par		Fair		Unrealized
		value		gain/(loss)		value		gain/(loss)		value		gain/(loss)		value		gain/(loss)		value		gain/(loss)		value		value		gain/(loss)
U.S. government and agencies	$	5,541	$	282	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	5,612	$	5,541	$	282
Municipal
Tax exempt		1,035		50		4,103		195		2,046		108		844		18		391		(52)		8,231		8,419		319
Taxable		209		24		2,676		320		1,105		102		375		(17)		113		(21)		5,633		4,478		408
Auction rate securities		384		(27)		208		(30)		64		(10)		-		-		61		(16)		801		717		(83)
Sub-total		1,628		47		6,987		485		3,215		200		1,219		1		565		(89)		14,665		13,614		644
Corporate
Public		959		55		2,610		156		11,920		802		12,448		729		3,098		69		28,947		31,035		1,811
Privately placed		1,271		52		1,501		93		4,204		290		6,701		276		1,619		(10)		14,764		15,296		701
Sub-total		2,230		107		4,111		249		16,124		1,092		19,149		1,005		4,717		59		43,711		46,331		2,512
Foreign government		767		106		457		29		432		30		333		30		-		-		1,869		1,989		195
RMBS
U.S. government sponsored entities		1,624		79		-		-		-		-		-		-		-		-		1,518		1,624		79
Prime residential mortgage-backed securities		162		3		51		1		156		4		35		-		484		(3)		968		888		5
Alt-A residential mortgage-backed securities		-		-		19		-		54		1		56		-		387		(57)		835		516		(56)
Subprime residential mortgage-backed securities		-		-		28		(5)		38		(8)		38		(12)		596		(234)		1,326		700		(259)
Sub-total		1,786		82		98		(4)		248		(3)		129		(12)		1,467		(294)		4,647		3,728		(231)
CMBS		899		46		184		5		187		(13)		284		(50)		199		(99)		1,932		1,753		(111)
ABS
Collateralized debt obligations		152		(3)		752		(24)		320		(56)		171		(46)		273		(52)		2,048		1,668		(181)
Consumer and other asset-backed securities		1,375		41		426		4		471		5		286		4		16		(3)		2,545		2,574		51
Sub-total		1,527		38		1,178		(20)		791		(51)		457		(42)		289		(55)		4,593		4,242		(130)
Redeemable preferred stock		-		-		1		-		-		-		24		2		-		-		21		25		2
Total fixed income securities	$	14,378	$	708	$	13,016	$	744	$	20,997	$	1,255	$	21,595	$	934	$	7,237	$	(478)	$	77,050	$	77,223	$	3,163

43

THE ALLSTATE CORPORATION

GROSS UNREALIZED GAINS AND LOSSES ON FIXED INCOME SECURITIES BY TYPE AND SECTOR

($ in millions)

		As of March 31, 2012
											Amortized
											cost as a		Fair value
		Par		Amortized		Gross unrealized				Fair	percent of		as a percent
		value (1)		cost		Gains		Losses		value	par value (2)		of par value (2)
Corporate:
Banking	$	4,134	$	4,114	$	133	$	(104)	$	4,143	99.5	%	100.2	%
Utilities		7,588		7,589		650		(36)		8,203	100.0		108.1
Financial services		3,589		3,538		188		(24)		3,702	98.6		103.1
Capital goods		4,964		5,004		370		(20)		5,354	100.8		107.9
Consumer goods (cyclical and non-cyclical)		8,720		8,844		529		(16)		9,357	101.4		107.3
Basic industry		2,890		2,912		140		(15)		3,037	100.8		105.1
Transportation		1,857		1,863		155		(11)		2,007	100.3		108.1
Energy		3,820		3,871		244		(7)		4,108	101.3		107.5
Communications		2,865		2,872		175		(6)		3,041	100.2		106.1
Technology		1,930		1,966		110		(3)		2,073	101.9		107.4
Other		1,354		1,246		66		(6)		1,306	92.0		96.5
Total corporate fixed income portfolio		43,711		43,819		2,760		(248)		46,331	100.2		106.0
U.S. government and agencies		5,612		5,259		287		(5)		5,541	93.7		98.7
Municipal		14,665		12,970		864		(220)		13,614	88.4		92.8
Foreign government		1,869		1,794		196		(1)		1,989	96.0		106.4
RMBS		4,647		3,959		126		(357)		3,728	85.2		80.2
CMBS		1,932		1,864		63		(174)		1,753	96.5		90.7
ABS		4,593		4,372		108		(238)		4,242	95.2		92.4
Redeemable preferred stock		21		23		2		-		25	109.5		119.0
Total fixed income securities	$	77,050	$	74,060	$	4,406	$	(1,243)	$	77,223	96.1		100.2

(1)Included in par value are zero-coupon securities that are generally purchased at a deep discount to the par value that is received at maturity.  These primarily included corporate, U.S. government and agencies, municipal and foreign government zero-coupon securities with par value of $488 million, $948 million, $3.13 billion and $382 million, respectively.

(2)Excluding the impact of zero-coupon securities, the percentage of amortized cost to par value would be 100.5% for corporates, 101.3% for U.S. government and agencies, 101.5% for municipals and 103.8% for foreign governments.  Similarly, excluding the impact of zero-coupon securities, the percentage of fair value to par value would be 106.2% for corporates, 104.2% for U.S. government and agencies, 106.7% for municipals and 111.6% for foreign governments.

44

THE ALLSTATE CORPORATION

REALIZED CAPITAL GAINS AND LOSSES BY TRANSACTION TYPE

($ in millions)

	Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
Impairment write-downs	$	(39	)	$	(122	)	$	(190	)	$	(70	)	$	(114	)
Change in intent write-downs		(44	)		(2	)		(13	)		(16	)		(69	)
Net other-than-temporary impairment losses recognized in earnings		(83	)		(124	)		(203	)		(86	)		(183	)
Sales		229			220			692			141			283
Valuation of derivative instruments		11			(9	)		(254	)		(50	)		22
Settlements of derivative instruments		11			(33	)		20			(3	)		(89	)
EMA limited partnership income (1)		-			32			9			55			63
Total	$	168		$	86		$	264		$	57		$	96

(1)Income from EMA limited partnerships is reported in net investment income in 2012 and realized capital gains and losses in 2011.

45

THE ALLSTATE CORPORATION

PROPERTY-LIABILITY

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

($ in millions)

	Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
NET INVESTMENT INCOME
Fixed income securities:
Tax-exempt	$	87		$	96		$	100		$	108		$	111
Taxable		178			170			176			180			169
Equity securities		19			44			20			32			18
Mortgage loans		6			4			3			1			-
Limited partnership interests (1)(2)		41			12			15			7			5
Short-term		1			1			1			-			1
Other		2			1			-			1			1
Sub-total		334			328			315			329			305
Less:  Investment expense		(21)			(19)			(17)			(19)			(21)
Net investment income	$	313		$	309		$	298		$	310		$	284
Net investment income, after-tax	$	232		$	233		$	225		$	236		$	219
PRE-TAX YIELDS (3)
Fixed income securities:
Tax-exempt		4.6	%		4.6	%		4.6	%		4.9	%		4.8	%
Equivalent yield for tax-exempt		6.7			6.7			6.7			7.1			7.0
Taxable		3.6			3.7			3.9			3.8			3.6
Equity securities		2.1			4.3			1.9			3.3			1.9
Mortgage loans		4.5			4.2			4.5			3.2			6.7
Limited partnership interests		5.5			6.3			8.8			4.2			2.9
Total portfolio (4)		3.8			4.0			3.9			4.0			3.7
REALIZED CAPITAL GAINS AND LOSSES
(PRE-TAX) BY ASSET TYPE
Fixed income securities:
Tax-exempt	$	25		$	5		$	30		$	(16)		$	(13)
Taxable		(5)			28			119			9			(29)
Equity securities		159			3			(77)			(2)			124
Limited partnership interests (2)		11			33			(3)			20			46
Derivatives and other		(1)			(57)			(45)			(19)			(71)
Total	$	189		$	12		$	24		$	(8)		$	57
REALIZED CAPITAL GAINS AND LOSSES
(PRE-TAX) BY TRANSACTION TYPE
Impairment write-downs	$	(19)		$	(54)		$	(105)		$	(27)		$	(64)
Change in intent write-downs		(28)			(1)			(10)			(11)			(27)
Net other-than-temporary impairment
losses recognized in earnings		(47)			(55)			(115)			(38)			(91)
Sales		237			82			186			29			172
Valuation of derivative instruments		3			(12)			(56)			(12)			26
Settlements of derivative instruments		(4)			(36)			11			(7)			(95)
EMA limited partnership income (2)		-			33			(2)			20			45
Total	$	189		$	12		$	24		$	(8)		$	57
AVERAGE INVESTED ASSETS (in billions) (5)	$	35.4		$	34.9		$	34.9		$	35.0		$	34.7

(1)         As of March 31, 2012, Property-Liability has commitments to invest in additional limited partnership interests totaling $1.20 billion.

(2)         Income from EMA limited partnerships is reported in net investment income in 2012 and realized capital gains and losses in 2011.

(3)         Pre-tax yields are calculated as annualized investment income (including dividend income in the case of equity securities) divided by the average of investment balances at the end of each quarter during the year. Investment balances, for purposes of the pre-tax yield calculation, exclude unrealized capital gains and losses. EMA limited partnership interests are included in the 2012 yields since their 2012 income is reported in net investment income.

(4)         Excluding the impact of EMA limited partnerships, the total portfolio yield was 3.6% for the three months ended March 31, 2012.

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

46

THE ALLSTATE CORPORATION

ALLSTATE FINANCIAL

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

($ in millions)

	Three months ended
		March 31,			Dec. 31,			Sept. 30,			June 30,			March 31,
		2012			2011			2011			2011			2011
NET INVESTMENT INCOME
Fixed income securities	$	531		$	546		$	572		$	596		$	607
Equity securities		2			2			3			2			1
Mortgage loans		87			88			88			86			89
Limited partnership interests (1)(2)		67			15			18			11			5
Short-term		-			-			1			-			1
Other		27			29			26			24			9
Sub-total		714			680			708			719			712
Less:  Investment expense		(27)			(24)			(26)			(25)			(28)
Net investment income	$	687		$	656		$	682		$	694		$	684
Net investment income, after-tax	$	455		$	431		$	448		$	455		$	449
PRE-TAX YIELDS (3)
Fixed income securities		4.8	%		4.9	%		5.0	%		5.0	%		5.0	%
Equity securities		3.9			4.6			8.0			2.9			3.3
Mortgage loans		5.2			5.3			5.3			5.2			5.4
Limited partnership interests		16.0			8.6			10.2			6.3			2.7
Total portfolio (4)		5.2			4.9			5.0			4.9			4.8
REALIZED CAPITAL GAINS AND LOSSES
(PRE-TAX) BY ASSET TYPE
Fixed income securities	$	(49)		$	56		$	433		$	46		$	15
Equity securities		-			-			-			17			(2)
Mortgage loans		(1)			10			(28)			(3)			(4)
Limited partnership interests (2)		(1)			(1)			11			30			22
Derivatives and other		30			3			(197)			(28)			8
Total	$	(21)		$	68		$	219		$	62		$	39
REALIZED CAPITAL GAINS AND LOSSES
(PRE-TAX) BY TRANSACTION TYPE
Impairment write-downs	$	(20)		$	(68)		$	(85)		$	(43)		$	(50)
Change in intent write-downs		(16)			(1)			(3)			(5)			(42)
Net other-than-temporary impairment
losses recognized in earnings		(36)			(69)			(88)			(48)			(92)
Sales		(8)			130			485			112			111
Valuation of derivative instruments		8			3			(198)			(38)			(4)
Settlements of derivative instruments		15			3			9			4			6
EMA limited partnership income (2)		-			1			11			32			18
Total	$	(21)		$	68		$	219		$	62		$	39
AVERAGE INVESTED ASSETS (in billions) (5)	$	55.3		$	56.2		$	57.7		$	58.8		$	60.2

(1)As of March 31, 2012, Allstate Financial has commitments to invest in additional limited partnership interests totaling $723 million.

(2)Income from EMA limited partnerships is reported in net investment income in 2012 and realized capital gains and losses in 2011.

(3)Pre-tax yields are calculated as annualized investment income (including dividend income in the case of equity securities) divided by the average of investment balances at the end of each quarter during the year.  Investment balances, for purposes of the pre-tax yield calculation, exclude unrealized capital gains and losses.  EMA limited partnership interests are included in the 2012 yields since their 2012 income is reported in net investment income.

(4)Excluding the impact of EMA limited partnerships, the total portfolio yield was 4.8% for the three months ended March 31, 2012.

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

47

THE ALLSTATE CORPORATION

SUMMARY OF RETROSPECTIVE ADJUSTMENTS FOR DAC ACCOUNTING ADOPTION

2011 Quarters and Year

($ in millions, except per share data)

	First Quarter 2011			Second Quarter 2011			Third Quarter 2011			Fourth Quarter 2011				2011
	Adjusted	Previously Reported	Increase (Decrease)	Adjusted	Previously Reported	Increase (Decrease)	Adjusted	Previously Reported	Increase (Decrease)	Adjusted		Previously Reported	Increase (Decrease)	Adjusted	Previously Reported	Increase (Decrease)
Net Income	524	519	5	(624)	(620)	(4)	175	165	10	712		724	(12)	787	788	(1)
Operating Income	494	497	(3)	(647)	(642)	(5)	80	84	(4)	735		750	(15)	662	689	(27)
Shareholders’ equity	18,898	19,312	(414)	18,382	18,764	(382)	17,732	18,100	(368)	18,298		18,674	(376)	18,298	18,674	(376)
Unrealized capital gains and losses, net of tax	1,072	1,079	(7)	1,475	1,446	29	1,065	1,032	33	1,400		1,363	37	1,400	1,363	37
Unrealized capital gains and losses on fixed income securities, net of tax	671	678	(7)	1,091	1,062	29	1,136	1,103	33	1,311		1,274	37	1,311	1,274	37
Net Income per basic share	0.99	0.98	0.01	(1.19)	(1.19)	-	0.34	0.32	0.02	1.41		1.44	(0.03)	1.51	1.51	-
Net Income per diluted share	0.98	0.97	0.01	(1.19)	(1.19)	-	0.34	0.32	0.02	1.40		1.43	(0.03)	1.50	1.51	(0.01)
Operating Income per diluted share	0.93	0.93	-	(1.24)	(1.23)	(0.01)	0.16	0.16	-	1.45		1.48	(0.03)	1.27	1.32	(0.05)
Book value per share	35.72	36.51	(0.79)	35.21	35.95	(0.74)	34.84	35.56	(0.72)	36.18		36.92	(0.74)	36.18	36.92	(0.74)
Book value per share, excluding unrealized on fixed income securities	34.46	35.22	(0.76)	33.12	33.91	(0.79)	32.61	33.39	(0.78)	33.58		34.40	(0.82)	33.58	34.40	(0.82)
Return on Shareholders’ equity	7.3	7.2	0.1	3.1	3.1	-	2.0	1.9	0.1	4.3		4.2	0.1	4.3	4.2	0.1
Operating Income Return on Shareholders’ equity	9.3	9.3	-	3.2	3.3	(0.1)	1.1	1.2	(0.1)	3.8		3.9	(0.1)	3.8	3.9	(0.1)
Allstate Financial Net Income	102	97	5	161	166	(5)	192	183	9	135		140	(5)	590	586	4
Allstate Financial Operating Income	113	116	(3)	135	141	(6)	129	134	(5)	130		138	(8)	507	529	(22)
Allstate Financial Attributed Equity	6,568	6,946	(378)	6,868	7,214	(346)	7,044	7,378	(334)	7,230		7,563	(333)	7,230	7,563	(333)
Allstate Financial Return on Attributed Equity	2.3	2.3	-	6.5	6.3	0.2	7.8	7.4	0.4	8.7		8.2	0.5	8.7	8.2	0.5
Allstate Financial Operating Income Return on Attributed Equity	7.3	7.3	-	7.6	7.5	0.1	7.8	7.8	-	8.3		8.2	0.1	8.3	8.2	0.1
Property-Liability Net Income	468	468	-	(737)	(738)	1	41	40	1	631		638	(7)	403	408	(5)
Property-Liability Operating Income	427	427	-	(732)	(733)	1	22	21	1	654		661	(7)	371	376	(5)
Property-Liability Underwriting Income	328	327	1	(1,502)	(1,502)	-	(309)	(311)	2	601		612	(11)	(882)	(874)	(8)
Property-Liability Combined Ratio	94.9	94.9	-	123.3	123.3	-	104.8	104.8	-	90.9	��	90.7	0.2	103.4	103.4	-
Property-Liability Underlying Combined Ratio	89.9	89.9	-	87.5	87.5	-	89.2	89.2	-	90.7		90.5	0.2	89.3	89.3	-
Property-Liability Expense Ratio	25.5	25.5	-	24.9	24.9	-	25.0	25.0	-	27.4		27.2	0.2	25.7	25.7	-

n/a - not available

48

THE ALLSTATE CORPORATION

SUMMARY OF RETROSPECTIVE ADJUSTMENTS FOR DAC ACCOUNTING ADOPTION

Years 2007 - 2010

($ in millions, except per share data)

	2010				2009						2008						2007
	Adjusted	Previously Reported	Increase (Decrease)		Adjusted		Previously Reported		Increase (Decrease)		Adjusted		Previously Reported		Increase (Decrease)		Adjusted	Previously Reported	Increase (Decrease)
Net Income	911	928	(17	)	888		854		34		(1,542	)	(1,679	)	137		4,619	4,636	(17	)
Operating Income	1,506	1,539	(33	)	1,880		1,881		(1	)	1,730		1,758		(28	)	3,841	3,863	(22	)
Shareholders’ equity	18,617	19,016	(399	)	16,184		16,692		(508	)	12,121		12,641		(520	)	21,241	21,851	(610	)
Unrealized capital gains and losses, net of tax	948	935	13		(983	)	(870	)	(113	)	(3,821	)	(3,738	)	(83	)	852	888	(36	)
Unrealized capital gains and losses on fixed income securities, net of tax	586	573	13		(1,080	)	(967	)	(113	)	(3,616	)	(3,533	)	(83	)	230	266	(36	)
Net Income per basic share	1.69	1.72	(0.03	)	1.65		1.58		0.07		(2.81	)	(3.06	)	0.25		7.77	7.80	(0.03	)
Net Income per diluted share	1.68	1.71	(0.03	)	1.64		1.58		0.06		(2.81	)	(3.06	)	0.25		7.73	7.76	(0.03	)
Operating Income per diluted share	2.78	2.84	(0.06	)	3.48		3.48		-		3.16		3.21		(0.05	)	6.43	6.47	(0.04	)
Book value per share	34.58	35.32	(0.74	)	29.90		30.84		(0.94	)	22.51		23.47		(0.96	)	37.47	38.54	(1.07	)
Book value per share, excluding unrealized on fixed income securities	33.49	34.26	(0.77	)	31.89		32.62		(0.73	)	29.22		30.04		(0.82	)	37.06	38.08	(1.02	)
Return on Shareholders’ equity	5.2	5.2	-		6.3		5.8		0.5		(9.2	)	(9.7	)	0.5		n/a	n/a	n/a
Operating Income Return on Shareholders’ equity	8.6	8.6	-		11.4		11.1		0.3		9.5		9.4		0.1		n/a	n/a	n/a
Allstate Financial Net Income	42	58	(16	)	(452	)	(483	)	31		(1,586	)	(1,721	)	135		453	465	(12	)
Allstate Financial Operating Income	444	476	(32	)	336		340		(4	)	408		438		(30	)	598	615	(17	)
Allstate Financial Attributed Equity	6,385	6,748	(363	)	n/a		n/a		n/a		n/a		n/a		n/a		n/a	n/a	n/a
Allstate Financial Return on Attributed Equity	n/a	n/a	n/a		n/a		n/a		n/a		n/a		n/a		n/a		n/a	n/a	n/a
Allstate Financial Operating Income Return on Attributed Equity	n/a	n/a	n/a		n/a		n/a		n/a		n/a		n/a		n/a		n/a	n/a	n/a
Property-Liability Net Income	1,053	1,054	(1	)	1,546		1,543		3		230		228		2		4,253	4,258	(5	)
Property-Liability Operating Income	1,253	1,254	(1	)	1,761		1,758		3		1,440		1,438		2		3,338	3,343	(5	)
Property-Liability Underwriting Income	494	495	(1	)	1,000		995		5		166		164		2		2,776	2,784	(8	)
Property-Liability Combined Ratio	98.1	98.1	-		96.2		96.2		-		99.4		99.4		-		89.8	89.8	-
Property-Liability Underlying Combined Ratio	89.6	89.6	-		88.1		88.1		-		86.8		86.8		-		85.7	85.7	-
Property-Liability Expense Ratio	25.1	25.1	-		24.6		24.6		-		25.0		25.0		-		24.9	24.9	-

n/a - not available

49

Definitions of Non-GAAP and Operating Measures

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

Operating income (loss) is net income (loss), excluding:

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

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

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

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

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

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

Combined ratio excluding the effect of catastrophes, prior year reserve reestimates, business combination expenses 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 reserve reestimates on the combined ratio, the effect of business combination expenses and the 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 business combination expenses and the amortization of purchased intangible assets. These 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.  Business combination expenses and the amortization of purchased intangible assets primarily relate to the acquisition purchase price and are 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”, “Standard Auto Profitability Measures” and “Homeowners Profitability Measures”.

Operating income return on shareholders’ equity is a ratio that uses a non-GAAP measure. It is calculated by dividing the rolling 12-month operating income by the average of 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 shareholders’ equity is the most directly comparable GAAP measure.  We use operating income as the numerator for the same reasons we use operating income, as discussed above.  We use average shareholders’ equity excluding the effect of unrealized net capital gains and losses for the denominator as a representation of 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 and return on 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 net income return on shareholders’ equity because it eliminates the after-tax effects of realized and unrealized net capital gains and losses that can fluctuate significantly from period to period and that are driven by economic developments, the magnitude and timing of which are generally not influenced by management.  In addition, it eliminates non-recurring items that are not indicative of our ongoing business or economic trends. A byproduct of excluding the items noted above to determine operating income return on shareholders’ equity from return on shareholders’ equity is the transparency and understanding of their significance to return on shareholders’ equity variability and profitability while recognizing these or similar items may recur in subsequent periods.  Therefore, we believe it is useful for investors to have operating income return on shareholders’ equity and return on shareholders’ equity when evaluating our performance.  We note that investors, financial analysts, financial and business media organizations and rating agencies utilize operating income return on shareholders’ equity results in their evaluation of our and our industry’s financial performance and in their investment decisions, recommendations and communications as it represents a reliable, representative and consistent measurement of the industry and the company and management’s utilization of capital.  Operating income return on shareholders’ equity should not be considered as a substitute for return on shareholders’ equity and does not reflect the overall profitability of our business.  A reconciliation of return on shareholders’ equity and operating income return on shareholders’ equity can be found in the schedule, “Return on Shareholders’ Equity”.

Book value per 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 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 shares outstanding plus dilutive potential shares outstanding.  We use the trend in book value per share, excluding the impact of unrealized net capital gains and losses on fixed income securities, in conjunction with book value per 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 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 share is the most directly comparable GAAP measure.  Book value per share, excluding the impact of unrealized net capital gains and losses on fixed income securities, should not be considered as a substitute for book value per share, and does not reflect the recorded net worth of our business.  A reconciliation of book value per share, excluding the impact of unrealized net capital gains on fixed income securities, and book value per share can be found in the schedule, “Book Value per Share”.

Operating Measure

We believe that investors’ understanding of Allstate’s performance is enhanced by our disclosure of the following operating financial measure.  Our method for calculating this measure may differ from those used by other companies and therefore comparability may be limited.

Premiums written is the amount of premiums charged for policies issued during a fiscal period.  Premiums earned is a GAAP measure.  Premiums are considered earned and are included in financial results on a pro-rata basis over the policy period.  The portion of premiums written applicable to the unexpired terms of the policies is recorded as unearned premiums on our Consolidated Statements of Financial Position.  A reconciliation of premiums written to premiums earned is presented in the schedule, “Property-Liability Results”.

Definitions of GAAP Operating Ratios and Impacts of Specific Items on the GAAP Operating Ratios

We use the following operating ratios to measure the profitability of our Property-Liability results.  We believe that they enhance an investor’s understanding of our profitability.  They are calculated as follows:

Claims and claims expense (“loss”) ratio is the ratio of claims and claims expense to premiums earned.  Loss ratios include the impact of catastrophe losses.

Expense ratio is the ratio of amortization of DAC, operating costs and expenses and restructuring and related charges to premiums earned.

Combined ratio is the ratio of claims and claims expense, amortization of DAC, operating costs and expenses and restructuring and related charges to premiums earned.  The combined ratio is the sum of the loss ratio and the expense ratio.  The difference between 100% and the combined ratio represents underwriting income (loss) as a percentage of premiums earned or underwriting margin.

Effect of Discontinued Lines and Coverages on combined ratio is the ratio of claims and claims expense and operating costs and expenses in the Discontinued Lines and Coverages segment to Property-Liability premiums earned.  The sum of the effect of Discontinued Lines and Coverages on the combined ratio and the Allstate Protection combined ratio is equal to the Property-Liability combined ratio.

Effect of catastrophe losses on combined ratio is the percentage of catastrophe losses included in claims and claims expense to premiums earned.  This ratio includes prior year reserve reestimates of catastrophe losses.

Effect of prior year reserve reestimates on combined ratio is the percentage of prior year reserve reestimates included in claims and claims expense to premiums earned.  This ratio includes prior year reserve reestimates of catastrophe losses.

Effect of restructuring and related charges on combined ratio is the percentage of restructuring and related charges to premiums earned.

Effect of business combination expenses and the amortization of purchased intangible assets on the combined and expense ratio is the percentage of business combination expenses and the amortization of purchased intangible assets to premiums earned.

50