Allstate Corp. said its second-quarter profit jumped 49 percent, on the benefit of more premiums and lower costs.
The Northbrook, Ill.-based home and auto insurer said it earned $614 million, or $1.39 a share, compared with $434 million, or 92 cents a share, in the same period last year.
Last year’s quarterly results were hurt by an after-tax loss of $312 million related to the repayment of debt.
It had operating income, which excludes certain one-time gains and losses, of $1.01 a share, down from the $1.12 in the same period last year.
Catastrophe losses were $936 million in the latest second quarter, compared with $647 million in the same period last year.
The insurer’s “combined ratio” was 97.4 in the second quarter, 1.3 points higher than the prior-year quarter due to the higher catastrophe losses. A combined ratio is the percentage of each premium dollar an insurer spends on claims and expenses.
If a company has a combined ratio greater than 100 percent, then it has more money going out than coming in, and it is losing money on its underwriting.
Allstate’s Esurance unit, however, continues to be unprofitable as an underwriter. Its combined ratio was 112.3 in the second quarter.
Revenue rose to $8.86 billion, from $8.79 billion in the same period a year ago.