Allstate Projects $900 Million in Reinsurance Recoveries from LA Wildfires

Allstate has reported significant financial losses from the Los Angeles wildfires, estimating $2 billion in gross damages. However, due to its comprehensive reinsurance program, the company expects to recover $900 million, bringing its net loss to $1.1 billion. These losses will be reflected in the insurer’s Q1 2025 financial statements.

Despite the wildfire impact, Allstate ended 2024 on a strong financial note, reporting a 30.1% increase in Q4 net income to $1.9 billion. Full-year revenues also saw a boost, rising 12.3% to $64.1 billion. The company attributes this growth to improved underwriting results, higher average earned premiums, and strategic investment adjustments.

Allstate’s reinsurance strategy includes a mix of traditional reinsurance and catastrophe bonds, providing coverage of up to $7.9 billion for a single event. The company’s financial performance remains resilient, with its Property-Liability combined ratio improving in 2024, reflecting disciplined risk management and a focus on profitability.