Acquisitions and Dispositions

6 Months Ended

Jun. 30, 2022

Business Combination and Asset Acquisition [Abstract]


Note 3			Acquisitions and Dispositions

Acquisitions

National General On January 4, 2021, the Company completed the acquisition of National General Holdings Corp. (“National General”), an insurance holding company serving customers predominantly through independent agents for property and casualty and accident and health products.


Assets and liabilities recognized in the National General acquisition (1)
($ in millions)	January 4, 2021
Assets
Investments	$	4,962
Cash	400
Premiums and other receivables, net	1,539
Deferred acquisition costs (value of business acquired)	317
Reinsurance recoverables, net	1,212
Intangible assets	1,199
Other assets	734
Goodwill (2)	1,038
Total assets	11,401

Liabilities
Reserve for property and casualty insurance claims and claims expense	2,765
Reserve for future policy benefits	186
Unearned premiums	2,245
Reinsurance payable	363
Debt (3)	593
Deferred tax liabilities	162
Other liabilities	776
Total liabilities	$	7,090

(1)The amounts reflect allocation of assets acquired and liabilities assumed.

(2)$675 million, $20 million and $343 million of goodwill were allocated to the Allstate Protection, Protection Services and Allstate Health and Benefits segments, respectively, and is non-deductible for income tax purposes. Goodwill is primarily attributable to expected synergies and future growth opportunities.

(3)Subsequent to the acquisition, the Company repaid $100 million of 7.625% Subordinated Notes and $72 million of Subordinated Debentures on February 3, 2021 and March 15, 2021, respectively. As of June 30, 2022, the Company had principal balance remaining of $350 million 6.750% Senior Notes due 2024, with a fair value adjustment of $36 million.

SafeAuto On October 1, 2021, the Company completed the acquisition of Safe Auto Insurance Group, Inc. (“SafeAuto”), a non-standard auto insurance carrier focused on providing state-minimum private-passenger auto insurance direct to consumers with coverage options in 28 states for $262 million in cash.

Dispositions

Life and annuity business On October 1, 2021, the Company closed the sale of ALNY to Wilton Reassurance Company for $400 million. On November 1, 2021, the Company closed the sale of ALIC and certain affiliates to entities managed by Blackstone for total proceeds of $4 billion, including a pre-close dividend of $1.25 billion paid by ALIC.

In 2021 and prior periods, the assets and liabilities of the businesses were reclassified as held for sale and results were presented as discontinued operations.


Financial results from discontinued operations
	Three months ended June 30,		Six months ended June 30,
($ in millions)	2021		2021
Revenues
Life premiums and contract charges	$	336	$	676
Net investment income	385		824
Net gains (losses) on investments and derivatives	110		189
Total revenues	831		1,689

Costs and expenses
Life contract benefits	386		796
Interest credited to contractholder funds	159		244
Amortization of DAC	21		57
Operating costs and expenses	51		106
Restructuring and related charges	4		23
Total costs and expenses	621		1,226

Amortization of deferred gain on reinsurance	2		4

Income from discontinued operations before income tax expense	212		467

Income tax expense	43		93

Income from discontinued operations, net of tax	169		374

Loss on disposition of operations	281		(4,137)
Income tax expense (benefit)	254		(166)
Loss on disposition of operations, net of tax	27		(3,971)

Income (loss) from discontinued operations, net of tax	$	196	$	(3,597)


Cash flows from discontinued operations
	Six months ended June 30,
($ in millions)	2021
Net cash provided by operating activities from discontinued operations	$	66
Net cash provided by investing activities from discontinued operations	317