Notice of 2025 Annual Meeting and Proxy Statement

Congressional authorization for the NFIP is

periodically evaluated and may be subjected to

freezes, including when the federal government

experiences a shutdown. FEMA has a NFIP reinsurance

program to manage the future exposure of the NFIP

through the transfer of risk to private reinsurance

companies and capital market investors. Congress

must periodically renew the funding of the program as

well as consider reforms to the program that would be

incorporated in legislation to reauthorize the NFIP. On

December 21, 2024, the president signed legislation

passed by Congress that extends the NFIP

authorization until March 14, 2025. As of September 30,

2024, the NFIP owes $20.5billion to the U.S. Treasury.

The amounts recoverable as of December31, 2024

and 2023 were $279 million and $76 million,

respectively. Annual premiums earned and paid to

NFIP include $368 million, $327 million and $319 million

in 2024, 2023 and 2022, respectively. Qualifying losses

incurred that are ceded to NFIP include $618 million,

$102 million and $435 million in 2024, 2023 and 2022,

respectively.

Catastrophe reinsurance The Company’s

reinsurance program is designed to provide

reinsurance protection for catastrophes resulting from

multiple perils including hurricanes, windstorms, hail,

tornadoes, winter storms, wildfires, earthquakes and

fires following earthquakes.

• The Company purchases reinsurance from

traditional reinsurance companies as well as the

insurance-linked securities (“ILS”) market.

• The majority of the Company’s program comprises

multi-year contracts, primarily placed in the

traditional reinsurance market, such that generally

one-third of the program is renewed every year.

• Coverage is generally purchased on a broad

geographic, product line and multiple peril loss

basis.

• Florida personal lines property is covered by a

separate agreement, as the risk of loss is different

and the Company’s subsidiaries operating in this

state are separately capitalized.

• When applicable, reinsurance reinstatement

premiums are recognized in the same period as

the loss event that gave rise to the reinstatement

premium and are recorded in claims and claims

expense in the Consolidated Statements of

Operations.

The Company’s current catastrophe reinsurance

program utilizes the Company’s risk and return

framework which is intended to provide shareholders

with an acceptable return on the risks assumed in the

property business, and to reduce variability of

earnings, while providing protection to customers. This

framework incorporates the Company’s robust

economic capital model and is informed by

catastrophe risk models including hurricanes,

earthquakes and wildfires. The Company monitors risk

both in the aggregate and by peril, while also

evaluating model performance relative to experience

and its expectations of catastrophe risk trends. As of

December 31, 2024, the modeled 1-in-100 probable

maximum loss for hurricane, earthquake and wildfire

perils is approximately $3.5billion, net of reinsurance.

The Company continually reviews its aggregate risk

appetite and the cost and availability of reinsurance to

optimize the risk and return profile of this exposure.

The following catastrophe reinsurance agreements are

in effect as of December31, 2024.

The Nationwide Excess Catastrophe Reinsurance

Program (the “Nationwide Program”) provides

coverage up to $7.90billion of loss less retentions of

$750million to $1.00billion for the first event of the

program year and is subject to the percentage of

reinsurance placed in each of its agreements. Multiple

wildfires can be defined by the Nationwide Program as

a single event occurrence based on a combination of

when the events occur and their proximity to one

another. Property business in the state of Florida is

excluded from this program. Separate reinsurance

agreements address the distinct needs of separately

capitalized legal entities. The Nationwide Program

includes reinsurance agreements with both the

traditional and ILS markets as described below:

•Core traditional market per occurrence

agreements provide limits totaling $5.09billion for

catastrophe losses arising out of multiple perils

and are comprised of the following:

– Multi-year contracts providing combined

$3.25billion of placed limits exhausting at

$4.25billion, with a 5% co-participation and

one annual reinstatement. One third of the

contracts are structured with a $750million

retention for the first event and $500million

retention for subsequent events with

remaining contracts attaching at a $1.00billion

retention.

– Two eight-year term contracts providing

combined $236million of placed limits, both

with a 5% co-participation and one

reinstatement of limits over each contract’s

term.

– Six single-year contracts providing combined

$1.61billion of placed limits filling capacity

around the multi-year and ILS placements,

with two contracts providing one

reinstatement of limits.

•ILS placements provide $1.95billion of placed

limits, with no reinstatement of limits, and are

comprised of the following:

– Six contracts providing occurrence coverage

of $1.30billion of placed limits, reinsuring

losses in all states except Florida caused by

named storms, earthquakes and fire following

earthquakes, severe weather, wildfires, and

other naturally occurring or man-made events

determined to be a catastrophe by the

Company.

– Two contracts providing occurrence and

aggregate coverage of $325million of placed

2024 Form 10-K Notes to Consolidated Financial Statements

The Allstate Corporation 151

Notice of 2025 Annual Meeting and Proxy Statement

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