Partially offsetting these positive rating attributes is Allstate's inherent exposure to natural disasters due to its expansive market presence throughout the United States. This exposure has been evident as significant net catastrophe losses have been reported in two of the past three years. However, during this time, Allstate has executed an extensive catastrophe risk exposure reduction program, including a significantly enhanced property catastrophe reinsurance program, non-renewals, stricter underwriting guidelines, increased deductibles and discontinuance of selected lines of coverage, including earthquakes. The group's underwriting results in 2012 benefited from these risk reduction actions and lower catastrophe losses.Key rating drivers that could produce a revision in the outlook or a downgrading of the ratings include capitalization that does not meet A.M. Best's “Superior” FSR standards; a sustained period of net losses or catastrophe losses out of proportion with market share; and consolidated financial leverage, including short-term debt of greater than 30%.
A.M. Best Affirms Ratings Of The Allstate Corporation And Its Subsidiaries
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