Investing.com -- Shares in Allstate Corporation (N:ALL) inched up in after-hours trading after the Illinois-based insurance company beat analysts' third quarter earnings expectations on Monday, amid a productive quarter from its home insurance division.
Allstate, the second-largest personal lines insurer in the U.S., saw its revenues for the third quarter increase by 1% to $9.03 billion, due primarily to sharp reductions from catastrophic losses and higher rates among its auto insurance products. The company's total property liability net premium jumped by 4.2% to $8.1 billion driven by sharp increases in the Allstate brand premium. At the same time, Allstate's E-Surance division saw its net written premium spike by 3.7%, following major reductions in marketing expenses.
"The homeowners business continued to generate excellent results due to the repositioning of the business several years ago and low catastrophe losses in the third quarter of 2015," Allstate CEO Thomas Wilson said in a statement. "Price increases approved for auto insurance for the first nine months of the year were double the average for the same periods of 2013 and 2014 as we work to lower the auto combined ratio. A reduction in underwriting expenses and a 10% increase in Allstate Financial operating income also benefited earnings."
In total, Allstate reported net earnings of $610 million for the three-month period up 2% on a year-over-year basis from the $598 million it earned in the third quarter of 2014. Allstate also finished with per share earnings of 1.52, significantly above analysts' expectations of 1.31 for the period. During last year's third quarter, Allstate reported earnings per share of 1.39.
“Policy in force growth for the property-liability business was 2.3%, driven by the Allstate brand, although auto insurance policy growth declined slightly from the second quarter of 2015, reflecting the impact of our profit improvement plan," Wilson added. "Investment results reflected a continuation of the strategy to increase performance-based investing and lower interest rate exposure."
Shares in Allstate gained 0.80 or 1.29% to 62.60 in after-hours trading.