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Allstate (ALL) Rides on Business Streamlining, Focus on Digital
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The Allstate Corp. (ALL - Free Report) is poised to grow on the back of business streamlining, which includes acquisitions and divestitures, investment in technology and other long-term growth initiatives.
This property and casualty insurer has been witnessing revenue increase every year since 2011 and also managed to tide over 2020 with revenue growth of 0.3%. The company’s ability to stay in a positive territory in the backdrop of this difficult operating environment is quite impressive.
The company’s long-term strategy of increasing personal property-liability market share and expanding protection offerings by leveraging the Allstate brand, customer base and capabilities will drive growth.
In sync with increasing personal property-liability market share, the company acquired National General in January 2021. The transaction will increase its market share in personal property liability by over one percentage point and enhance its independent agent-facing technology. It will significantly expand its distribution footprint, leading the company to be one of the top five personal lines carriers in the independent agency distribution channel. Additional expansion opportunities through independent agents also exist in standard auto and homeowners insurance.
Expansion of its Protection Services segment is another key growth strategy. The company’s Protection Services segment accounted for 4.3% of its 2020 consolidated total revenues. Protection Services is a key part of the company’s strategy. It is expanding other protection businesses and increasing its total addressable market by delivering superior value propositions and building strategic platforms to connect and engage with customers and effectively address their changing needs and preferences.
Allstate has also announced the pending sale of ALIC and certain affiliates, which represents approximately 90% of Allstate Life and 75% of Allstate Annuities reserves for life-contingent contract benefits and contract holder funds. The company expect to discontinue sales of proprietary life insurance products during the second quarter of 2021. These businesses have been affected by low interest rates and thus been a drag on the company’s growth. Thus, separating these business will help it to focus on its property and casualty and service business.
Allstate is also investing in technology to digitize its processes and to this end has expanded its utilization of virtual claims processes in response to the coronavirus outbreak. It is continuing to implement new technology and process improvements that provide continued loss cost accuracy, efficient processing and enhanced customer experiences that are simple, fast and produce high degrees of satisfaction.
Its Digital Operating Centers handle auto physical damage claims countrywide utilizing its virtual estimation capabilities, which include estimating damage with photos and video through the use of QuickFoto Claim and Virtual Assist.
The company’s virtual assist and aerial imagery using satellites, airplanes and drones handle property claims by estimating damage through video. These organizational and process changes impact frequency and severity statistics and help to settle claims faster.
Other companies in the insurance space are fast adopting digital ways to operate. Some of the leading property and casualty companies in the United States are Berkshire Hathaway Inc. (BRK.B - Free Report) , The Progressive Corporation (PGR - Free Report) , and The Travelers Companies, Inc. (TRV - Free Report) .
Allstate has gained 2.7% compared with the industry’s growth of 6.6%.
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Image: Bigstock
Allstate (ALL) Rides on Business Streamlining, Focus on Digital
The Allstate Corp. (ALL - Free Report) is poised to grow on the back of business streamlining, which includes acquisitions and divestitures, investment in technology and other long-term growth initiatives.
This property and casualty insurer has been witnessing revenue increase every year since 2011 and also managed to tide over 2020 with revenue growth of 0.3%. The company’s ability to stay in a positive territory in the backdrop of this difficult operating environment is quite impressive.
The company’s long-term strategy of increasing personal property-liability market share and expanding protection offerings by leveraging the Allstate brand, customer base and capabilities will drive growth.
In sync with increasing personal property-liability market share, the company acquired National General in January 2021. The transaction will increase its market share in personal property liability by over one percentage point and enhance its independent agent-facing technology. It will significantly expand its distribution footprint, leading the company to be one of the top five personal lines carriers in the independent agency distribution channel. Additional expansion opportunities through independent agents also exist in standard auto and homeowners insurance.
Expansion of its Protection Services segment is another key growth strategy. The company’s Protection Services segment accounted for 4.3% of its 2020 consolidated total revenues. Protection Services is a key part of the company’s strategy. It is expanding other protection businesses and increasing its total addressable market by delivering superior value propositions and building strategic platforms to connect and engage with customers and effectively address their changing needs and preferences.
Allstate has also announced the pending sale of ALIC and certain affiliates, which represents approximately 90% of Allstate Life and 75% of Allstate Annuities reserves for life-contingent contract benefits and contract holder funds. The company expect to discontinue sales of proprietary life insurance products during the second quarter of 2021. These businesses have been affected by low interest rates and thus been a drag on the company’s growth. Thus, separating these business will help it to focus on its property and casualty and service business.
Allstate is also investing in technology to digitize its processes and to this end has expanded its utilization of virtual claims processes in response to the coronavirus outbreak. It is continuing to implement new technology and process improvements that provide continued loss cost accuracy, efficient processing and enhanced customer experiences that are simple, fast and produce high degrees of satisfaction.
Its Digital Operating Centers handle auto physical damage claims countrywide utilizing its virtual estimation capabilities, which include estimating damage with photos and video through the use of QuickFoto Claim and Virtual Assist.
The company’s virtual assist and aerial imagery using satellites, airplanes and drones handle property claims by estimating damage through video. These organizational and process changes impact frequency and severity statistics and help to settle claims faster.
Other companies in the insurance space are fast adopting digital ways to operate. Some of the leading property and casualty companies in the United States are Berkshire Hathaway Inc. (BRK.B - Free Report) , The Progressive Corporation (PGR - Free Report) , and The Travelers Companies, Inc. (TRV - Free Report) .
Allstate has gained 2.7% compared with the industry’s growth of 6.6%.
Allstate currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>