Allstate Corp (ALL) Q3 2022 Earnings Call Transcript

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day and thank you for standing by. Welcome to Allstate's Third Quarter Investor Call. At this time, all participants are in a listen-only mode. After prepared remarks, there will be a question-and-answer session. As a reminder, please be aware that this call is being recorded.

And now I'd like to introduce your host for today's program, Mr. Mark Nogal, Head of Investor Relations. Please go ahead, sir.

Mark Nogal - Head, IR

Thank you, Jonathan. Good morning and welcome to Allstate's third quarter 2022 earnings conference call. After prepared remarks, we'll have a question-and-answer session. Yesterday following the close of the market, we issued our news release and investor supplement filed our 10-Q and posted today's presentation on our website allstateinvestors.com.

Our management team is here to provide perspective on these results. As noted on the first slide of the presentation, our discussion will contain non-GAAP measures for which there are reconciliations in the news release and investor supplement and forward-looking statements about Allstate's operations. Allstate's results may differ materially from these statements, so please refer to our 10-K for 2021 and other public documents for information on potential risks. Additionally, we will be hosting our next special topic investor call on December 2, focusing on Allstate's auto and home insurance claims practices and reserving process.

And now I'll turn it over to Tom.

Thomas Wilson - Chairman, President & CEO

Well, good morning. Thank you for investing your time with Allstate today. As you know, we pre-released earnings several weeks ago and reported the net loss for the quarter. That reflected a small underlying, underwriting margin that was offset by increases in reserves for prior years and a mark-to-market loss on public equity securities. .

Mario and Jeff will go through the details of the quarter and the reserve changes after I set some context. So let's start on Slide 2. Allstate's strategy to increase shareholder value has two components: increase personal profit liability market share and expand protection services, which are shown in the two ovals on the left. We're building a low-cost digital insurer with broad distribution through transfer onto growth to increase market share. We're also broadening protection offerings and leveraging the Allstate brand, customer base and capabilities with expanded distribution.

In the third quarter, we made progress executing this strategy, while we continue to implement a comprehensive approach to improve auto profitability, which is shown in the right-hand panel, that includes broadly raising auto insurance rates, which you've seen in our disclosures. Operating expenses were lowered, including advertising and more permanent reductions in the operating cost structure.