A.M. Best Upgrades Selected Allstate-Encompass Companies; Assigns Ratings.

OLDWICK, N.J. -- A.M. Best Co. has upgraded the financial strength rating (FSR) to A+ (Superior) from A- (Excellent) and issuer credit ratings (ICR) to "aa" from "a-" of Encompass Home and Auto Insurance Company, Encompass Independent Insurance Company, Encompass Insurance Company of America and Encompass Property and Casualty Company. The rating outlook for the FSR is stable, and the rating outlook for the ICRs has been revised to negative from stable. A.M. Best has also assigned a FSR of A+ (Superior) and an ICR of "aa" to Encompass Insurance Company of Massachusetts. The FSR has a stable rating outlook, while the ICR has a negative outlook. All the above companies are part of the Allstate Insurance Group (Allstate). All companies are headquartered in Northbrook, IL. The ratings and outlooks of the remaining Encompass companies within Allstate remain unchanged.

The ratings reflect the companies' inclusion as members of Allstate as they are fully integrated from an operations perspective and are integral to Allstate's strategic goal of multiple distribution channels. In addition, the companies benefit from the financial and operating support of their ultimate parent, The Allstate Corporation (NYSE: ALL). This support is demonstrated through full reinsurance protection of the companies by Allstate Insurance Company.

In October 1999, Allstate purchased the assets and liabilities of CNA Insurance Companies' (CNA) personal lines business. The purchase was part of Allstate's strategy to increase its growth opportunities by gaining access to the independent agent distribution channel. In addition to the asset purchase, Allstate agreed to 100% reinsure the business, and it also obtained the right to manage the business via an Administrative Services Agreement. As a result, CNA no longer retained any business, as all premiums and liabilities were ceded to Allstate. Furthermore, Allstate acquired the option to purchase the above-named Encompass companies from CNA for one year commencing October 1, 2004, which Allstate exercised effective October 1, 2005. This ownership as well as the previously mentioned integration and financial support make the companies eligible for full rating enhancement.

For Best's Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

For current Best's Ratings, independent data and analysis on more than 3,000 individual property/casualty companies and A.M. Best groups, please visit www.ambest.com/pc.

A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com.