The counterparty credit rating on Allstate Corp. is based on the company's strong debt leverage, interest, and fixed charge coverage ratios, its diversified earnings stream from its core operating companies, strong cash flows from its operating companies, and the availability of excess capital at Kennett Capital (Kennett). Partially offsetting these positive factors are the company's exposure to potential large catastrophic events from its property/casualty (P/C) operations and recurring adverse asbestos reserve developments. Debt leverage (as measured by debt to total capital) was about 19.6% as of year-end 2004. Fixed charge and interest coverage ratios, excluding interest credited to contract holder funds, were more than 13x as of year-end 2004. These metrics are well within the range appropriate for the rating
