Allstate Revises Reported Profit

Wed Nov 13, 7:36 PM ET

NORTHBROOK, Ill. (Reuters) – Allstate Corp., the No. 2 U.S. car and home insurer, on Thursday revised its previously announced third quarter earnings downwards, citing a $32 million charge it is taking for settling an insurance dispute.

The company now says its third quarter profit was $248 million, or 35 cents a share, down from the $280 million, or 39 cents a share, it reported a month ago in its earnings press release.

Allstate said it reached the settlement with a policyholder over an asbestos and pollution-related dispute earlier this week.

Though the settlement comes after the end of its third quarter, the company had not filed its third quarter earnings report with the Securities and Exchange Commission yet and decided to record the charge in the third quarter itself. That is permitted under accounting rules, it said.

Allstate also said it reaffirmed its operating earnings forecast for 2002, despite the settlement.

The company on Oct. 16 said it expected to earn between $2.80 and $3.00 per share, above the average estimate of $2.76 per share from analysts polled before the outlook was announced.

The company is the No. 2 U.S. car and home insurer behind State Farm Insurance Cos.

Allstate, like other insurers, has raised rates in the past two years after a decade-long price war in the industry to respond to soaring real estate values and rising claims on damage caused by storms, mold and water. In February, it reported its third straight annual profit decline.