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March 13, 2009 |
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ASBESTOS LITIGATION: Allstate Cites $1.933B Reserves at Dec. 31 The Allstate Corporation's gross reserves for asbestos claims were US$1.933 billion for the year ended Dec. 31, 2008, compared with US$2.053 billion for the year ended Dec. 31, 2007. The Company's gross reserves for asbestos claims were US$1.24 billion at Sept. 30, 2008. The Company's asbestos reserves, net of insurance recoverables, were US$709 million at Sept. 30, 2008. (Class Action Reporter, Oct. 24, 2008) The Company's net reserves for asbestos claims were US$1.288 billion for the year ended Dec. 31, 2008, compared with US$1.302 billion for the year ended Dec. 31, 2007. At Dec. 31, 2008 IBNR (incurred-but-not-reported) represented 64 percent of total net asbestos reserves, one point lower than at Dec. 31, 2007. IBNR provides for reserve development of known claims and future reporting of additional unknown claims from current and new policyholders and ceding companies. For the year ended Dec. 31, 2008, the Company recorded 601 new claims, closed 1,077 claims, had 8,780 pending claims, and closed 800 claims without payment. For the year ended Dec. 31, 2007, the Company recorded 876 new claims, closed 795 claims, had 9,256 pending claims, and closed 364 claims without payment. Reinsurance recoverables include US$227 million from Lloyd's of London at Dec. 31, 2008, compared with US$240 million at Dec. 31, 2007. Lloyd's of London, through the creation of Equitas Limited, implemented a restructuring plan in 1996 to solidify its capital base and to segregate claims for years prior to 1993. The recoverable from Equitas Limited syndicates is spread among thousands of Lloyd's of London investors who have unlimited liability. The reinsurance recoverables valuation allowance was reduced by US$46 million in 2007 related to Equitas Limited's improved financial position as a result of its obtaining reinsurance coverage with National Indemnity Company. Headquartered in Northbrook, Ill., The Allstate Corporation is engaged in the personal property and casualty insurance business and the life insurance, retirement and investment products business. It conducts its business mainly in the United States. |
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