The counterparty credit rating on Allstate Corp. (Allstate) is based on the company's diversified and favorable earnings; very strong interest and fixed-charge coverage metrics, very strong liquidity and financial flexibility; and excess capital at Kennett, a wholly owned investment company. Partially offsetting these strengths are the company's somewhat aggressive capital management strategy, which endorses a sizable share repurchase policy that has contributed to a reduction in capitalization from historically higher levels, earnings and capital volatility due to continued exposure to potential catastrophic losses, and recurring adverse asbestos reserve development. Allstate has a strongly diversified and national market presence in the U.S., with operations in both the property/casualty and life insurance sectors. The company operates the second-largest domestic personal lines insurer
