Allstate Improves Ability to Serve Florida Customers.

ST. PETERSBURG, Fla. -- The Allstate Corporation announced a series of steps to strengthen its ability to serve customers for the 2005 hurricane season and beyond. The steps increase the financial resources of its separate and distinct companies that write residential property insurance in Florida ("Allstate Floridian") and reduce exposure to the risk of hurricane losses to these companies. These actions were necessitated by the substantial losses that Allstate Floridian incurred in meeting its obligations to its customers following the unprecedented series of four hurricanes in 2004.

"Allstate Floridian takes pride in serving our state. Dedicated agents and claim employees did an exemplary job for customers after the hurricanes," said Phil Lawson, Allstate Floridian President. "Now, with the 2005 hurricane season starting in two weeks, we must be ready to handle future hurricane losses."

In order to have the financial resources to help withstand future hurricane losses, Allstate Floridian has decided to purchase a two-year reinsurance program from private reinsurance companies to protect itself against more than $800 million of future losses in a year or $1.6 billion of losses over two years, in excess of any losses that may be covered by the Florida Hurricane Catastrophe Fund. The cost for this essential reinsurance protection is substantial. By necessity, Allstate Floridian will need to increase its rates in order to afford the cost of the reinsurance and other costs of doing business.

In addition to Allstate Floridian expanding the availability of potential financial resources from third parties, its parent company, Allstate Insurance Company ("Allstate Insurance") has committed to make as much as $375 million of additional capital available to Allstate Floridian for one year under specified circumstances.

Additionally, Allstate recently announced an innovative program that, in addition to the limited business Allstate agents can place with Allstate Floridian, enables participating agencies to continue to sell new property insurance policies, but through several independent, unaffiliated insurance companies, including Universal Insurance Company of North America (UICNA), a wholly owned subsidiary of Universal Insurance Group. This program, which is now available in most counties, provides property insurance choices to Florida homeowners and condo owners.

"It's a novel approach and one that is aligned with our goal of helping customers in a very challenging property insurance environment," said Lawson.

Also, Allstate Floridian has reached a definitive agreement for a portion of its existing customers to have a new policy available from UICNA when their existing policies with Allstate Floridian expire and are not renewed. About 12.5 percent of Allstate Floridian's 758,000 policyholders will be impacted by this agreement and will have a new policy available through UICNA.

Allstate Floridian has been a highly visible and vocal advocate for insurance reform in the recent Florida state legislative session, working hard to keep consumers informed about needed changes and encouraging consumers to contact their lawmakers (through broadcast and print advertisements, direct mailings and the www.helpfloridahomeowners.org website).

"There is still significant room for improvement to give Florida homeowners protection at a better price," said Lawson. "Allstate Floridian continues to urge state lawmakers to allow insurers to purchase additional hurricane coverage from the Florida Hurricane Catastrophe Fund rather than being forced to buy the more costly private reinsurance. That would let consumers benefit from lower insurance costs."

Separately, Allstate Insurance Company is filing a plan with the Florida Office of Insurance Regulation ("OIR") to gradually discontinue its Florida commercial property lines of business and will be providing notice to approximately 16,000 affected policyholders. The comprehensive plan allows Allstate agencies to assist the affected policyholders to find new policies through the company's existing "Commercial Expanded Markets Program," which provides access to several third parties that can provide coverage.

"In light of the financial challenges caused by the unprecedented 2004 hurricane season, Allstate Insurance Company has re-examined its commercial insurance operations in Florida," said Lawson. "Based upon that examination, Allstate has decided to limit its commercial insurance operations to the commercial auto business."

Allstate Floridian Insurance Company and Allstate Floridian Indemnity Company are independent subsidiaries of The Allstate Corporation and are the primary providers of personal lines property insurance in Florida for the Allstate group. Allstate Floridian Insurance Company and Allstate Floridian Indemnity Company sell homeowners, condominium owners, renters and mobile home insurance protection through nearly 900 agencies in the state of Florida. Property insurance policies sold by Allstate Floridian Insurance Company and Allstate Floridian Indemnity Company are not underwritten or reinsured by any other company in the Allstate group.

The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held personal lines insurer. Widely known through the "You're In Good Hands With Allstate(R)" slogan, Allstate helps individuals in approximately 17 million households protect what they have today and better prepare for tomorrow through approximately 13,600 exclusive agencies and financial professionals in the U.S. and Canada. Customers can access Allstate products and services such as auto insurance and homeowners insurance through Allstate agencies, or in select states at allstate.com and 1-800 Allstate(R). Encompass(SM) and Deerbrook(R) Insurance brand property and casualty products are sold exclusively through independent agents. Allstate Financial Group provides life and supplemental accident and health insurance, annuity, banking and retirement products designed for individual, institutional and worksite customers that are distributed through Allstate agencies, independent agencies, financial institutions and broker-dealers.