A

PROJECT REPORT

ON

“Exploring Customer Relationship Management Practices at Allstate

Insurance”

SUBMITTED

To

CENTRE FOR ONLINE LEARNING

Dr. D.Y.PATIL VIDYAPEETH, PUNE

IN PARTIAL FULFILMENT OF DEGREEOF

MASTER OF BUSINESS ADMINISTRATION

BY

Josephine Suse

PRN: 2205020825

BATCH: 2022-2024

1
 Dr. D.Y. Patil Vidyapeeth’s
CENTRE FOR ONLINE LEARNING,
Sant TukaramNagar,Pune.

CERTIFICATE

This is to certify that Miss. Josephine Suse PRN – 2205020825 has completed her

working Professional at Allstate Insurance Company starting from 05/11/2023 to

20/12/2023. Her project work was a part of the MBA (ONLINE LEARNING) The

project is on “Exploring Customer Relationship Management Practices at Allstate

Insurance” Which includes research as well as industry practices. She was very sincere

and committed in all tasks.

Course Coordinator Director

_________________ ---------------------------

( ) ( )

Date -

2
3
 DECLARATION BY LEARNER

This is to declare that I have carried out this project work myself in part fulfillment of the

M.B.A Program of Centre for Online Learning of Dr.D.Y.Patil Vidyapeeth’s, Pune –

411018

The work is original, has not been copied from anywhere else, and has not been

submitted to any other University / Institute for an award of any degree / diploma.

Date: - Signature: -

Place: Name: Miss. Josephine Suse

4
 ACKNOWLEDGEMENT

I wish to express my sincere gratitude to Prof Vikas Pawar for providing me an

opportunity to do my project work in “Exploring Customer Relationship Management

Practices at Allstate Insurance”. I also wish to express my gratitude to the officials and

other staff members who rendered their help during the period of my project work.

I would also like to extend my gratitude to Prof Safia Farooqui the Director of

Dr. D. Y. Patil Vidyapeeth Center for Online Learning for providing me the opportunity

to embark on this project. My sincere thanks to Prof. Sadik Naim Shaikh for guiding all

the time for project.

Finally, I would like to thank my parents and friends. who helped me a lot in

finishing this project.

Signature: -

Name: Miss. Josephine Suse

Table of content
Sr. Item Page
5
 No. No
1 Executive Summary 7

2 Chapter 1: Introduction (Company Profile & General 8

Introduction of Topic)

& Objective, Scope and Purpose of Study

3 Chapter 2: Literature Review 24

4 Chapter 3: Research methodology 44

5 Chapter 4: Data Analysis 51

6 Chapter 5: Findings, suggestions, recommendation 58

7 Chapter 6: Conclusion 60

8 Bibliography (Books, Journals, research work) 62

9 Reference (Website, company paper) 63

10 Annexure (A to C) 70

11 A- Questionnaire 71

12 B- Scope for future study 75

13 C- Photograph, Drawings 76

EXECUTIVE SUMMARY

Allstate is a leading insurer in the United States property and casualty insurance

market with its largest segment of business in personal lines. The firm is the fourth most

6
popular provider of personal auto insurance and has approximately 10% of that market

share after this 2022. Over the past few years Allstate has consistently beat earnings

reports and has had a 150% increase in its stock share price. Much of its growth has

occurred within the last year alone with 62.5% of the growth from the past year, along

with a 55.9% increase in market capitalization. In conjunction with this growth in

insurance market share and stock market value, Allstate has acquired companies to

increase its customer base and to diversify its offerings to consumers. The largest of

these acquisitions was in 2014 when the firm purchased American Strategic Insurance

(ASI) for $875 million. ASI is an insurance provider, mainly acquired for its home and

property offerings, a field where Allstate lacks substantial market share ("Allstate

Insurance," 2014). The company has also looked to grow itself internally, outlining in its

annual report its over 12,000 new hiring’s this year

7
 Chapter 1: Introduction

Introduction

Before we begin to examine the conceptual foundations of CRM, it will be useful

to define, what is CRM? A narrow perspective of customer relationship management is

database marketing emphasizing the promotional aspects of marketing linked to database

8
efforts. Another narrow, yet relevant, viewpoint is to consider CRM only as customer

retention in which a variety of after marketing tactics is used for customer bonding or

staying in touch after the sale is made. Shani and Chalasani define relationship marketing

as “an integrated effort to identify, maintain, and build up a network with individuals

consumers and to continuously strengthen the network for mutual benefit of both sides,

through interactive, individualized and value-added contacts over a period of time”. The

core theme of all CRM and relationship marketing perspectives is its focus on co-

operative and collaborative relationships between the firm and its customers, and/or

other marketing actors.

CRM is based on the premise that, by having a better understanding of the

customers’ needs and desires we can keep them longer and sell more to them.

Growth Strategies International (GSI) performed a statistical analysis of

Customer satisfaction data encompassing the findings of over 7,000+ customer surveys

conducted by Angel Broking Ltd.

CRM (customer relationship management) is an information industry term for

methodologies, software, and usually Internet capabilities that help an enterprise manage

customer relationships in an organized way. For example, an enterprise might build a

database about its customers that described relationships in sufficient detail so that

management, salespeople, people providing service, and perhaps the customer directly

could access information, match customer needs with product plans and offerings,

remind customers of service requirements, know what other products a customer had

purchased, and so forth.

The essence of the information technology revolution and, in particular, the

World Wide Web is the opportunity to build better relationships with customers than has

been previously possible in the offline world. By combining the abilities to respond
9
directly to customer requests and to provide the customer with a highly interactive,

customized experience, companies have a greater ability today to establish, nurture, and

sustain long-term customer relationships than ever before. The ultimate goal is to

transform these relationships into greater profitability by increasing repeat purchase rates

and reducing customer acquisition costs. Indeed, this revolution in customer relationship

management or CRM.1 as it is called, has been referred to as the new “mantra” of

marketing.2 Companies like Siebel, E.piphany, Oracle, Broadvision, Net Perceptions,

Kana and others have filled this CRM space with products that do everything from track

customer behavior on the Web to predicting their future moves to sending direct e-mail

communications. This has created a worldwide market for CRM products and services of

$34 billion in 1999 and which is forecasted by IDC to grow to $125 billion by 2004.3

The need to better understand customer behavior and focus on those customers who can

deliver long-term profits has changed how marketers view the world.

Traditionally, marketers have been trained to acquire customers, either new ones

who have not bought the product category before or those who are currently competitors’

customers. This has required heavy doses of mass advertising and price-oriented

promotions to customers and channel members. Today, the tone of the conversation has

changed from customer acquisition to retention. This requires a different mindset and a 3

different and new set of tools. A good thought experiment for an executive audience is to

ask them how much they spend and/or focus on acquisition versus retention activities.

While it is difficult to perfectly distinguish the two activities from each other, the

answer is usually that acquisition dominates retention.

According to one industry view, CRM consists of:

10
  Helping an enterprise to enable its marketing departments to identify and target

their best customers, manage marketing campaigns with clear goals and

objectives, and generate quality leads for the sales team.

 Assisting the organization to improve telesales, account, and sales management

by optimizing information shared by multiple employees, and streamlining

existing processes (for example, taking orders using mobile devices)

 Allowing the formation of individualized relationships with customers, with the

aimof improving customer satisfaction and maximizing profits; identifying the

most profitable customers and providing them the highest level of service.

 Providing employees with the information and processes necessary to know their

customers, understand their needs, and effectively build relationships between the

company, its customer base, and distribution partners.

CRM--Customer Relationship Management--has entered the mainstream. Despite

the uncertainty of the economy, CRM is being thrust into corporate budgets and talked

about as a critical initiative by hundreds of Fortune 1,000 and tens of thousands of other

companies. It has gone from being an important edge in the business world to a

necessary tool for survival. The notion of the customer as king or queen is once again the

rule. How you treat this is a mission-critical business issue.

But, what is CRM and how does it change the way companies do business? The

changes in the world have been so dynamic and so dramatic that the path is not

necessarily all that obvious. How CRM impacts that business path is a continuing source

of debate in the world of corporate management.

Managing relationships with customers has become a critical organizational

competency. Get winning strategies for acquiring and retaining customers by leveraging

the latest advanced technologies. This course will teach you how to select the right tools
11
for your business-- so it can grow today--and on into the future. Lagging means lost

customers, which means damage to the bottom line. But how do you not lag when

customers are moving lightning fast to demand constant changes in the speed to

complete their transactions? How do you keep your customers when the move to another

company is nothing more than a mouse click and a minute away?

CRM is the answer. Customer Relationship Management, a strategy that

leverages very advanced technologies is the way to cut to the 21st Century business

chase.

History of CRM

Customer Relationship Management (CRM) is one of those magnificent concepts

that swept the business world in the 1990’s with the promise of forever changing the way

businesses small and large interacted with their customer bases. In the short term,

however, it proved to be an unwieldy process that was better in theory than in practice

for a variety of reasons. First among these was that it was simply so difficult and

expensive to track and keep the high volume of records needed accurately and constantly

update them. In the last several years, however, newer software systems and advanced

tracking features have vastly improved CRM capabilities and the real promise of CRM is

becoming a reality. As the price of newer, more customizable Internet solutions have hit

the marketplace; competition has driven the prices down so that even relatively small

businesses are reaping the benefits of some custom CRM programs.

In the beginning…

The 1980’s saw the emergence of database marketing, which was simply a catch

phrase to define the practice of setting up customer service groups to speak individually

to all of a company’s customers. In the case of larger, key clients it was a valuable tool

for keeping the lines of communication open and tailoring service to the clients needs. In
12
the case of smaller clients, however, it tended to provide repetitive, survey-like

information that cluttered databases and didn’t provide much insight. As companies

began tracking database information, they realized that the bare bones were all that was

needed in most cases: what they buy regularly, what they spend, what they do.

Advances in the 1990’s

In the 1990’s companies began to improve on Customer Relationship

Management by making it more of a two-way street. Instead of simply gathering data for

their own use, they began giving back to their customers not only in terms of the obvious

goal of improved customer service, but in incentives, gifts and other perks for customer

loyalty. This was the beginning of the now familiar frequent flyer programs, bonus

points on credit cards and a host of other resources that are based on CRM tracking 3333

customer activity and spending patterns. CRM was now being used as a way to increase

sales passively as well as through active improvement of customer service.

True CRM comes of age

Real Customer Relationship Management as it’s thought of today really began in

earnest in the early years of this century. As software companies began releasing newer,

more advanced solutions that were customizable across industries, it became feasible to

really use the information in a dynamic way. Instead of feeding information into a static

database for future reference, CRM became a way to continuously update understanding

of customer needs and behavior. Branching of information, sub-folders, and custom

tailored features enabled companies to break down information into smaller subsets so

that they could evaluate not only concrete statistics, but information on the motivation

and reactions of customers. The Internet provided a huge boon to the development of

these huge databases by enabling offsite information storage, where before companies

had difficulty supporting the enormous amounts of information. The Internet provided
13
new possibilities and CRM took off as providers began moving toward Internet

solutions. With the increased fluidity of these programs came a less rigid relationship

between sales, customer service and marketing. CRM enabled the development of new

strategies for more cooperative work between these different divisions through shared

information and understanding, leading to increased customer satisfaction from order to

end product.

Today, CRM is still utilized most frequently by companies that rely heavily on

two distinct features: customer service or technology. The three sectors of business that

rely most heavily on CRM -- and use it to great advantage -- are financial services, a

variety of high tech corporations and the telecommunications industry. The financial

services industry in particular tracks the level of client satisfaction and what customers

are looking for in terms of changes and personalized features. They also track changes in

investment habits and spending patterns as the economy shifts. Software specific to the

industry can give financial service providers truly impressive feedback in these areas.

In recent years however, several factors have contributed to the rapid

development and evolution of CRM. These include: -

1. The growing de-intermediation process in many industries due to the advent of

sophisticated computer and telecommunication technologies that allow producers to

directly interact with end-customers. For example, in many industries such as airlines,

banks insurance, software or household appliances and even consumables, the de-

intermediation process is fast changing the nature of marketing and consequently making

relationship marketing more popular. Databases and direct marketing tools give them the

means to individualize their marketing efforts.

14
2. Advances in information technology, networking and manufacturing technology have

helped companies to quickly match competition. As a result product quality and cost are

no longer significant competitive advantages.

3. The growth in service economy. Since services are typically produced and delivered at

the same institution, it minimizes the role of the middlemen.

4. Another force driving the adoption of CRM has been the total quality movement.

When companies embraced TQM it became necessary to involve customers and

suppliers in implementing the program at all levels of the value chain. This needed close

working relationships with the customers. Thus several companies such as Motorola,

IBM, General Motors, Xerox, Ford, Toyota, etc formed partnering relations with

suppliers and customers to practice TQM. Other programs such as JIT and MRP also

made use of interdependent relationships between suppliers and customers.

5. Customer expectations are changing almost on a daily basis. Newly empowered

customers, who choose, how to communicate with the companies’ various available

channels? Also nowadays consumers expect a high degree of personalization.

6. Emerging real time, interactive channels including e-mail, ATMs and call centre that

must be synchronized with customer’s non-electronic activities. The speed of business

change, requiring flexibility and rapid adoption to technologies.

7. In the current era of hyper competition, marketers are forced to be more concerned

with customer retention and customer loyalty.

8. As several researches have found out retaining customers is less expensive and more

sustainable competitive advantage than acquiring new ones.

9. On the supply side it pays more to develop closer relationships with a few suppliers

than to develop more vendors.

15
10. The globalization of world marketplace makes it necessary to have global account

management for the customers.

Definition: -

“CRM is concerned with creating improved shareholder value through the use of

customer centric business processes and the development of appropriate relationships

with consumers.”

Implementing CRM:

CRM requires an integration of a firm's resources; people, operations and

marketing capabilities to deliver added value to the customers. CRM should provide

businesses and organizations with a ‘single view’ of their customers and across

irrespective of the interactive channel or medium through which the customer accesses

the service or product. For example, a business (e.g. hotel) customer’s profile and

personal references should be accessible to the business (or hotel) irrespective of channel

i.e. whether the customer books online, calls in or walks into any location should not

make a difference to the service provided based on the personal profile of the business

client.

It is enabled through:

 Information

 Processes

 Technology

 Applications

A firm that wants to implement CRM must align it's business processes cross-

functionally in the best possible way to allow increased customer focus with an aim to

deliver added value to the customer.

To implement CRM, the following steps must be followed:

16
  Develop a CRM framework

 Align current business processes

 Design new cross-functional business processes (where required)

 Develop Functional Specifications (client-side services)

 Develop Technical Specifications

 Match Technical Specifications to available technology (Systems, software, etc)

 Product Configuration

 Data Migration and Integration

 Staff Training

 Customer Segmentation: For CRM to be effective, the organization’s customer

base must be stratified into segments based on commonalities amongst groups’ of

individuals and customers. This also requires the organization to have strategies

to target consolidated customer segments.

 Reduced Cost of Service: a customer relationship strategy should reduce the cost

of service for both the organization and it’s customers and increase satisfaction

levels.

 Service as a differentiator: The more competitive a market becomes the more a

business will need to rely on its superior product quality and quality of service to

differentiate itself from other businesses and providers.

 Tie-in’s over time: The greater the effort a customer spends on a relationship over

time, the greater the customer’s stake in helping to ensure that the relationship

works and the more convenient and loyal the customer becomes.

Pitfalls to avoid:

Many CRM programs fail for two reasons:

17
1. Lack of supportive business processes: Because business processes and

organizational goals are not part of a strategic CRM plan tied to organizational

goals and objectives.

2. Lack of an enterprise perspective: For Relationship Marketing to be effective, it

requires that the organization creates a seamless enterprise view. A lot of CRM

programs fail because they are assembled with disparate components that aren't

designed to work together as part of a complete CRM system designed to meet

organizational objectives.

18
Customer Relationship Management Model

CREATE A DATA BASE

ANALYSIS

CUSTOMER SELECTION

CUSTOMER TARGETING

RELATIONSHIP MARKETING

PRIVACY ISSUES

METRICS

19
 Customer Retention Programs

FREQUENCY/

LOYALTY

PROGRAMS

CUSTOMIZATION
CUSTOMER

SERVICE

REWARDS COMMUNITY

PROGRAMS BUILDING

20
 CUSTOMER
RELATIONSHIP
MANAGEMENT
SATISFACTION

Objective of the study of CRM

CRM, in its broadest sense, means managing all interactions and business with

customers. This includes, but is not limited to, improving customer service. A good

CRM program will allow a business to acquire customers, service the customer, increase

the value of the customer to the company, retain good customers, and determine which

customers can be retained or given a higher level of service. A good CRM program can

improve customer service by facilitating communication in several ways:

 Provide product information, product use information, and technical assistance on

web sites that are accessible 24 hours a day, 7 days a week

 Identify how each individual customer defines quality, and then design a service

strategy for each customer based on these individual requirements and

expectations.

 Provide a fast mechanism for managing and scheduling follow-up sales calls to

assess post-purchase cognitive dissonance, repurchase probabilities, repurchase

times, and repurchase frequencies.

21
 Provide a mechanism to track all points of contact between a customer and the

company, and do it in an integrated way so that all sources and types of contact

are included, and all users of the system see the same view of the customer

(reduces confusion).

 Help to identify potential problems quickly, before customer occur

 Provide a user-friendly mechanism for registering customer complaints

(complaints that are not registered with the company cannot be resolved, and are

a major source of customer dissatisfaction).

 Provide a fast mechanism for handling problems and complaints (complaints that

are resolved quickly can increase customer satisfaction).

 Provide a fast mechanism for correcting service deficiencies (correct the problem

before other customers experience the same dissatisfaction).

 Use internet cookies to track customer interests and personalize product offerings

accordingly

 Use the Internet to engage in collaborative customization or real-time

customization

 Provide a fast mechanism for managing and scheduling maintenance, repair, and

ongoing support (improve efficiency and effectiveness)

 Mechanism to evaluate Potential KOMs.

 To develop integrated Database.

 Assessing the need of Potential KOMs.

 Ways to meet those needs.

 Identify the softer elements.

 Devising a way to Retain and grow with those KOMs.

22
  Moving further ahead Satisfaction Delightment LOYALITY

 To develop Strategy and action plan on quarter & annual basis.

 To gain knowledge about consumer behaviour

 To know, how to maintain relationship with customer?

 To know, the needs analysis of customer

 To understand, with the help of feedback form that why customers are not trading

with Angel

 To know, the customer perception about company’s products & services

 To know, the grievances among the customers about products & services

The CRM program can be integrated into other cross-functional systems and

thereby provide accounting and production information to customers when they want it.

 Keeping Existing Customers

Grading customers from very satisfied to very disappointed should help the

organization in improving its customer satisfaction levels and scores. As the satisfaction

level for each customer improves, so shall the customer retention with the organization.

 Maximizing Life time value

Exploit up-selling and cross-selling potential. By identifying life stage and life

event trigger points by customer, marketers can maximize share of purchase potential.

Thus the single adults shall require a new car stereo and as he grows into a married

couple his needs grow into appliances.

 Increase Loyalty

Loyal customers are more profitable. Any company will like its mindshare status

to improve from being a suspect to being an advocate. Company has to invest in terms of

its product and service offerings to its customers. It has to innovate and meet the very
23
needs of its customers so that they remain as advocates on the loyalty curve. Referral

sales invariably are low cost high margin sales.

Chapter 2: Literature Review

24
 2. Literature Review

Company Profile:

The Allstate Corporation is an American insurance company, headquartered in

Glenview, Illinois (with a Northbrook, Illinois address) since 2022. [4] Founded in 1931

as part of Sears, Roebuck and Co., it was spun off in 1993, but was still partially owned

by Sears until it became an independent company completely in June 1995.[3] The

company also has personal lines insurance operations in Canada.

Allstate is a large corporation, and with 2018 revenues of $39.8 billion, it ranked

79th in the 2019 Fortune 500 list of the largest United States corporations by total

revenue.[5] Its long-running advertising campaign, in use since 1950, asks, "Are you in

25
good hands?",[6][7] and the recognizable logo portrays a suburban-style dwelling

cradled protectively in a pair of giant human hands.

History

In 1925, Sears held a national contest to decide the name of a new brand of car

tires. After over two million name submissions, "Allstate" was chosen. The trademark

was adopted the next year. The tires' success in the catalog and retail stores prompted

Sears Chairman General Robert E. Wood to praise the Allstate tire's contribution to

Sears' retail store success.[1]

The idea for Allstate Insurance Company came during a bridge game on a

commuter train in 1930, when insurance broker Carl L. Odell proposed to Wood, his

neighbor, the idea of selling auto insurance by direct mail. The idea appealed to Wood,

and he passed the proposal along to the Sears board of directors, which approved it.

Allstate Insurance Company, named after Sears’ tire brand, went into business on April

17, 1931, offering auto insurance by direct mail and through the Sears catalog.[8] This

was in line with one of the objectives of a company to sell automobile insurance in the

same manner as Sears sold its merchandise.[9]

Lessing J. Rosenwald was Allstate's first board chairman, and Odell was named vice

president and secretary.[7]

In 1933, at the Century of Progress World's Fair in Chicago, Allstate's Richard E.

Roskam sold insurance at a booth in the Sears pavilion. In 1934, Allstate opened its first

permanent sales office in a Chicago Sears store.[10]

In 1941, only about a quarter of US drivers had auto liability insurance. This led

to the state of New York passing a law that established the financial responsibility of
26
drivers for damage or injuries resulting from auto mishaps. That law inspired legislation

in other states, and by the mid-1950s, nearly every state had some sort of financial

responsibility law on its books.[8]

In 1949, the Allstate Headquarters Building was completed at 3246 W.

Arthington Street in Chicago as a part of the Sears, Roebuck and Company Complex.

[11] The midrise building is vacant (as of 2013) and in danger of demolition. The

building is noted for its early postwar midrise construction. This location was vacated

when the company relocated in the postwar years.

The company's "You're in Good Hands with Allstate" slogan was created in 1950

by Allstate's general sales manager Davis W. Ellis. At the end of the decade, it was used

in the company's first network-television advertising campaign, which featured actor Ed

Reimers.[7]

Allstate added products throughout the 1950s, including fire insurance in 1954

and homeowners and life insurance in 1957. Allstate began selling insurance to

Canadians in 1953. Allstate Insurance Company of Canada was incorporated in 1964.[8]

(In 1952 and 1953, Sears also sold an automobile called Allstate.)

In 1967, the company's home office was moved from Skokie to Northbrook,

Illinois. Allstate continued to sell additional types of insurance to customers throughout

the decade, including worker's-compensation insurance in 1964, surety bonds in 1966,

inland-marine coverage in 1967, and a business package policy in 1969.[7]

The brand itself expanded in the 1950s and 1960s and could be found on a variety

of products such as fire extinguishers and motor scooters. In 1952, an Allstate car was
27
produced, but it was a flop; it was pulled from stores by 1953. The Allstate brand was

eventually limited to insurance, tires, and car batteries by the late 1960s, before

becoming insurance only in the mid-1970s.[1]

In 1984, Neighborhood Office Agent program was introduced to make agents

more accessible to customers.[citation needed]

In 1985, Allstate began to move agents out of Sears stores and locate agents in

neighborhood offices. In 1991, the company went public[3] before becoming completely

independent in 1995.[1]

In June 1993, 19.8% of Allstate became public through a stock offering. Allstate

became completely independent in June 1995, when Sears spun off the remaining 80%

stake in the company, distributing 350.5 million shares of Allstate stock to its

stockholders.[8]

In 1993, Allstate went public when Sears sold 19.8% of the company.[12] At the

time, it was the largest IPO to date.

In 1996, their website www.allstate.com was launched.[citation needed] In 1999,

Allstate unveiled a new business model that created a single contract for exclusive,

independent agents selling Allstate insurance. It also created a network of call centers.

[citation needed] That same year, it signed a 10-year contract with the village of

Rosemont, Illinois, to acquire naming rights and renovate the Rosemont Horizon.

In 1999, Allstate purchased the personal-lines division of CNA Financial[13] and

subsequently renamed it to Encompass Insurance Company, which is written by

independent insurance agents, as opposed to the direct writing that constitutes the core

part of its business.[14]

28
 In 2003, actor Dennis Haysbert became Allstate's spokesman, using the tagline

"That’s Allstate’s stand."[15]

In 2010, actor Dean Winters became a part of Allstate's campaign "Mayhem",

"personifying the pitfalls, like collisions and storm damage, that can befall drivers".

In May 2011, Allstate announced that it was purchasing Esurance and rate-

comparison site Answer Financial for about $1 billion. At the time, Esurance was selling

policies in 30 states and was in the midst of a five-year growth period that had them

double the number of policies in force. Allstate, for its part, was losing policyholders to

the three major online policy retailers: Esurance, Allstate, and GEICO.[16][17]

In 2012, Allstate Solutions Private Limited (also called Allstate India) was

inaugurated in Bangalore; it is a technology and operations center to provides software

development and business process outsourcing services to its US parent.[18] Allstate's

Bangalore operation is focused on the areas of business intelligence, analytics, testing,

and mobility.

In January 2017, Allstate acquired SquareTrade, a consumer electronics and

appliance protection plan provider. The acquisition cost a reported $1.4 billion from a

group of shareholders.[19]

In 2018, Allstate collaborated with the Red Cross to distribute 1,000 disaster kits

statewide in Hawaii.[20]

In 2019, Allstate donated $75,000 to the Red Cross and again partnered with the

organization to distribute over 2,900 disaster kits in California.[21]

29
 In July 2020, Allstate announced it was acquiring National General for $4 billion.

The deal closed in January 2021.[22][23]

In 2021 Allstate completed sale of its life insurance and annuity businesses. This

was part of a strategy to increase market share in personal-property businesses.[24] One

of the divested businesses was Allstate Life Insurance Company of New York, which

became part of Wilton Reassurance Life Company of New York. Another was the

similarly named Allstate Life Insurance Company, purchased by Everlake Holdings and

renamed Everlake Life Insurance Company. A third divested business was Allstate

Assurance Co, also purchased by Everlake Holdings.[25]

Corporate leadership
The people in this section are members of corporate leadership.[26]

CEOs

Since its IPO in 1993:

 Thomas J. Wilson (2007–present)

 Edward Liddy (1999–2006)

 Jerry D. Choate (1995–1999)

 Wayne E. Hedien (1993–1994)

Current leadership

 Thomas J. Wilson - chairman, CEO, President, The Allstate Corporation

 Steven E. Shebik - Vice Chairman, The Allstate Corporation and CEO, Allstate
Life Insurance Company

 Brian Bohaty - Executive VP, Corporate Business Transformation

 Don Civgin - President, Allstate Service Businesses

 John O'Donnell - President, Allstate West Territory, Allstate Personal Lines

 John Dugenske - Executive VP, Chief Investment and Strategy Officer, The
Allstate Corporation and President, Allstate Investments
30
  Mary Jane Fortin - President, Allstate Financial

 Suren Gupta - Executive VP, Allstate Technology & Strategic Ventures

 Guy Hill - Executive VP, Product Integration & Management

 Susan Lees - Executive VP, General Counsel, Secretary

 Jess Merten - Executive VP and Chief Risk Officer, Allstate Insurance Company

 Julie Parsons - Executive VP, Product Operations

 David Prendergast - President, Allstate East Territory

 Mario Rizzo - Executive VP and Chief Financial Officer, The Allstate

Corporation

 Ken Rosen - Executive VP and Chief Claims Officer

 Glenn Shapiro - President, Allstate Personal Lines

 Steven P. Sorenson Fian - Executive VP, Allstate Brand Operations

Board of Directors: -

1 Tom Wilson

CEO of Allstate since 2007

Board Chair, President, and Chief Executive Officer

Committee Assignments and Rationale

Executive Committee (Chair)

31
  Comprehensive knowledge of Allstate's business and industry, with 28 years of

leadership experience at the company.

 Significant governance experience through active dialogue with shareholders and

corporate governance experts.

Professional Experience

 Current CEO (since January 2007) and Chair of Board (since May 2008).

 President from June 2005 to January 2015 and from February 23, 2018, to

present.

 Held other senior executive roles and led all major operating units.

 Former director at State Street Corporation.

Key Experience and Qualifications

Financial Services: Extensive experience gained while spending entire career

within the financial services industry, including 28 years with Allstate.

Risk Management: Created and implemented Allstate's risk and return

optimization program, which allowed Allstate to withstand the financial market crisis

and currently helps the company mitigate risks due to increased severe weather.

Accounting and Finance: Deep understanding of strategic, financial and

operational planning and analysis gained over tenure serving in leadership roles at

Allstate.

Technology and/or Cybersecurity: Led investments in innovative products and

services at Allstate, including telematics, digital protection solutions and customer-

centric innovations.

32
 Global Perspective: Comprehensive understanding gained while leading a

Fortune 100 company with global operations and over 20% of employees outside of the

U.S.

Complex, Highly Regulated Businesses: Valuable insights gained while serving

in the highly regulated insurance industry.

Sustainability: During tenure at Allstate, enhanced sustainability initiatives,

including setting net-zero emissions targets and reducing emissions footprint.

Succession Planning and Human Capital Management: Public advocate for

business playing a broad role in society through initiatives such as providing living

wages and improving diversity and equity.

Innovation and Customer Focus: Shaped and executed initiatives to fulfill

Allstate's role with, and responsibilities to, its customers and other key stakeholders

including creating and leading its Transformative Growth strategy to build a digital

insurance business model.

Government, Public Policy and Regulatory Affairs: Deep understanding of legal

and regulatory requirements relevant for large, public companies developed while having

responsibility for ensuring compliance by Allstate.

2. Donald E. Brown

Independent Director since 2020

Executive Vice President, Chief Innovation Officer, NiSource Inc.

33
Committee Assignments and Rationale

Audit Committee

 Multiple leadership positions with financial oversight responsibility, including as

former Chief Financial Officer at NiSource, a highly regulated natural gas and
electric utilities company serving customers across multiple states.

Nominating, Governance and Social Responsibility Committee

 Management and leadership experience as senior leader of NiSource, including

oversight of employee talent and retention programs.

 Experience leading climate strategies for a large gas and electric utilities
company.

Professional Experience

 Current Executive Vice President and Chief Innovation Officer of NiSource Inc.,
a highly regulated natural gas and electric utilities company serving customers
across multiple states.

 Former EVP and CFO of NiSource Inc.

Key Experience and Qualifications

Risk Management: As Executive Vice President and Chief Innovation Officer of

NiSource, has overall responsibility for identifying and evaluating financial risk
exposures and determining steps to mitigate those risks.
34
Accounting and Finance: Significant financial and accounting experience gained
leading the financial operations of one of the largest utility companies in the country.

Technology and/or Cybersecurity: Current role requires in-depth understanding of

technological advancements and operational transformation to enhance the customer
experience.

Complex, Highly Regulated Businesses: Expertise developed while working within the
heavily regulated utilities industry.

Sustainability: Experience developing and leading transition to a less carbon-intensive

business model gained while serving in leadership roles at NiSource, a utilities company.

Succession Planning and Human Capital Management: Responsibilities as a senior

leader at NiSource include oversight of employee recruitment, development and
retention, as well as leadership of large teams.

Innovation and Customer Focus: Experience obtained while overseeing a business

focused on delivering safe, reliable and efficient services to customers and communities.

Government, Public Policy and Regulatory Affairs: Deep understanding of

compliance and governmental requirements acquired as a senior leader of one of the
largest fully regulated utility companies in the United States.

3. Kermit R. Crawford

Independent Director since 2013

Former President and Chief Operating Officer, Rite Aid Corporation

Independent Director

35
Committee Assignments and Rationale

Audit Committee (Chair)

 Responsibility for all aspects of strategic, operational, and profit and loss
management of two of the largest drugstore chains in the United States.

 Board leadership and nine years tenure on Allstate Board.

 Former member of the audit committee at TransUnion and the audit and
compliance committee at LifePoint Health.

Risk and Return Committee

 Significant operational experience at large, geographically dispersed service

organizations.

 Chair of Allstate audit committee.

Professional Experience

 Former President and Chief Operating Officer of Rite Aid Corporation, which
operates one of the leading retail drugstore chains in the United States (October
2017 – March 2019).

 Former Operating Partner, Retail and Healthcare with Sycamore Partners, a

private equity firm.

36
  Held positions of increasing responsibility and leadership including Executive
Vice President and President, Pharmacy, Health and Wellness at Walgreens Co.,
which operates one of the largest drugstore chains in the United States.

 Former Director of TransUnion and LifePoint Health.

Key Experience and Qualifications

Risk Management: Extensive experience in business strategy and risk management

gained through his leadership roles.

Accounting and Finance: As President and Chief Operating Officer of Rite Aid
Corporation, had overall responsibility for all operational aspects of the large drugstore
chain, including financial results.

Technology and/or Cybersecurity: Effectively led operational change, including the

use of technology, at Rite Aid and Walgreens.

Complex, Highly Regulated Businesses: Expertise acquired in assessing the strategies

and performance of a geographically distributed and consumer-focused service business
in a highly competitive and regulated industry.

Sustainability: Over 30 years of operational experience that included driving

sustainability initiatives with consumer and retail companies.

Succession Planning and Human Capital Management: As a senior leader at leading

retail drugstore chains, responsibilities included leadership of large divisions and human
capital priorities and culture.

Innovation and Customer Focus: Deep understanding of consumer experiences and

insights gained as President, Pharmacy, Health and Wellness at Walgreens, where he
effectively oversaw the transition of the pharmacy experience from a model focused
primarily on drug delivery to a pharmacist-patient centric model.

Government, Public Policy and Regulatory Affairs: Extensive knowledge of legal and
regulatory requirements relevant for large, public companies gained as a senior leader of
one of the largest drugstore chains in the United States.

37
4. Richard T. Hume

Independent Director since 2020

CEO, TD SYNNEX

Committee Assignments and Rationale

Compensation and Human Capital Committee

 Significant management experience leading large companies as CEO and COO.

 Comprehensive market knowledge of executive compensation, recruitment and

succession practices as CEO of TD SYNNEX.

Risk and Return Committee

 In-depth understanding of technology, innovation and transformative growth.

 Responsibility for strategic direction of large technology company.

Professional Experience

 Current CEO and director of TD SYNNEX, a global IT distribution and solutions

company.

 Former COO of Tech Data Corporation.

 Former General Manager and COO, Global Technology Services at IBM.

Key Experience and Qualifications

38
Risk Management: Acquired deep understanding of risk evaluation and management
while overseeing business transformations, including major acquisitions, at leading
technology companies.

Accounting and Finance: Strong operational experience acquired through leadership

roles at large technology companies, including overseeing financial and accounting
operations.

Technology and/or Cybersecurity: Extensive technology background gained as a

senior leader at IBM and as CEO with responsibility for overseeing the innovative
strategy, technological advancement and transformative growth of a global IT
distribution and solutions company.

Global Perspective: Deep knowledge gained while overseeing global technology

services at IBM, leading the strategic direction and go-to-market execution of Tech
Data's regional operations in the Americas, Europe and Asia Pacific, and as CEO of TD
SYNNEX.

Sustainability: As CEO of a public company, responsible for developing and driving

sustainability initiatives.

Succession Planning and Human Capital Management: Significant management and

succession planning experience gained through various senior leadership roles at public
companies.

Innovation and Customer Focus: Deep knowledge gained while overseeing TD

SYNNEX, a company that plays a critical role in the technology business partner
ecosystem by helping its channel partners deliver the products and solutions the world
needs to connect, grow and advance.

5. Margaret M. Keane

Independent Director since 2018

Former Chair, CEO and President, Synchrony Financial

39
Committee Assignments and Rationale

Compensation and Human Capital Committee

 Substantial experience in establishing management performance objectives and

specific goals.

 Significant market knowledge of executive compensation as the former CEO of

Synchrony Financial.

Nominating, Governance and Social Responsibility Committee

 Board leadership as former Chair of Synchrony Financial.

 Thought leader and driver of inclusion and diversity initiatives.

Professional Experience

 Former Chair, CEO and President of Synchrony Financial, a consumer financial

services company.

 Former President and CEO of GE Capital Retail Finance.

Key Experience and Qualifications

Financial Services: Extensive operational and strategic experience in the consumer

financial services industry acquired as CEO of two financial services companies.

Risk Management: In-depth understanding and experience in risk and return

management acquired during tenure as senior executive in the financial services industry.

Accounting and Finance: As CEO of Synchrony Financial, had overall responsibility

for financial operations of the company.

40
Technology and/or Cybersecurity: Extensive knowledge of innovation and technology
transformation strategies gained throughout financial services career, including driving
Synchrony's digital transformation, and use of artificial intelligence, machine learning
and data analytics to improve underwriting.

Complex, Highly Regulated Businesses: Deep expertise acquired through leadership

roles within a heavily regulated industry spanning consumer finance, vendor financial
services, operations and quality.

Sustainability: As CEO, drove various sustainability priorities and programs, including

diversity and inclusion initiatives, earning Synchrony the reputation as one of the
country's best employers and corporate citizens.

Succession Planning and Human Capital Management: Significant experience in

developing succession planning and performance goals gained as CEO of Synchrony.

Innovation and Customer Focus: During time as CEO, led strategic and technology
transformation in rapidly changing consumer payments industry.

Government, Public Policy and Regulatory Affairs: Gained experience as CEO in a

highly regulated industry, as well as through working with Business Roundtable to
promote a thriving U.S. economy and expanded opportunity for all Americans through
sound public policy.

Other Public Board Service

 Synchrony Financial (2014–2023)

 Tenable (2023–present)

6. Monica Turner

Independent Director since 2023

President, North America, Procter & Gamble

41
Committee Assignments and Rationale

Audit Committee

 Overall responsibility for the financial, sales and operational aspects of the
largest region of a global consumer goods company.

 Multiple leadership positions with financial oversight responsibility, including as

current President of the most profitable region of Procter & Gamble.

Nominating, Governance and Social Responsibility Committee

 Significant management and leadership experience gained throughout tenure at

Procter & Gamble, including oversight of sustainability initiatives and programs.

 Recognized thought leader and driver of inclusion and diversity initiatives.

Professional Experience

 Current President, North America, of Procter & Gamble.

 Former President, North America Sales, of Procter & Gamble.

 Former EVP and Head of Sales, North America, of Procter & Gamble.

 Former SVP, Sales of Beauty, Health and Grooming Sector, of Procter &
Gamble.

42
Key Experience and Qualifications

Financial Services: Has overall responsibility for all financial, sales and operational
aspects of the largest and most profitable region of Procter & Gamble.

Risk Management: Significant experience in management and oversight of risk and

return gained during tenure with large consumer goods company.

Accounting and Finance: Has held multiple leadership positions with financial
oversight responsibility in many business units within Procter & Gamble.

Technology and/or Cybersecurity: Experience gained in delivering transformational

results through technology in role as head of largest region of Procter & Gamble,
including digitization of P&G's supply chain for more effective and efficient operations
and the use of data and technology to deeply understand consumer needs.

Global Perspective: Comprehensive knowledge gained over career with one of the
world's largest global consumer goods companies and currently oversees operations,
including membership on Procter & Gamble's Global Leadership Council.

Sustainability: Role as President of North America region of Procter & Gamble

includes responsibility for sustainability initiatives and programs.

Succession Planning and Human Capital Management: Recognized leader of equality

and inclusion initiatives that accelerated thought leadership and delivered tangible results
within Procter & Gamble.

Innovation and Customer Focus: Deep insights into customer preferences and needs
developed over career at one of the largest consumer goods companies, with current
responsibility for overseeing a division serving 370 million consumers in the U.S.,
Canada and Puerto Rico.

Government, Public Policy and Regulatory Affairs: As part of role as President at

Procter & Gamble, partners with multiple government agencies and has overall
responsibility for operations, including related regulatory compliance, spanning sales
offices, technical centers, manufacturing plants and mixing centers.

43
44
Chapter 3: Research methodology

Research Methodology for CRM

Meeting and satisfying each customer’s need uniquely and individually. In the

mass markets individualized information on customers is now possible at low costs due

45
to the rapid development in the information technology and due to availability of

scalable data warehouses and data mining products. By using online information and

databases on individual customer interactions, marketers aim to fulfill the unique needs

of each mass-market customer. Information on individual customers is utilized to

develop frequency marketing, interactive marketing, and after marketing programs in

order to develop relationship with high-yielding customers. In the context of business-to-

business markets, individual marketing has been in place

of quite sometime. Known as Key Account Management Program, here marketers

appoint customer teams to husband the company resources according to individual

customer needs.

Continuity Marketing Programs

Take the shape of membership and loyalty card programs where customers are

often rewarded for their member and loyalty relationships with the marketers. The basic

premise of continuity marketing programs is to retain customers and increase loyalty

through long-term special services that has a potential to increase mutual value through

learning about each other.

Partnering Programs

The third type of CRM programs is partnering relationships between customer

and marketers to serve end user needs. In the mass markets, two types of partnering

programs are most common: Co-branding and affinity partnering. Missing process of

CRM Traditionally customer relationship management (CRM) revolves around the three

functions of selling, marketing and support. Various process models have been built

around how these functions are integrated and operated in a customer oriented enterprise.

There is however a fourth critical function that is lacking in most CRM models.

46
 The fourth function that often is the source of a competitive edge is that of

innovation. Companies must continually reinvent themselves to deliver an improved and

often a totally new value offering to their customer base. CRM must provide the

customer intelligence that feeds information back into the enterprise’s knowledge

management processes where it can trigger new innovation processes. When CRM is

integrated into the innovation process, significant value can be derived from faster time

to market cycle times and with new processes and services. Marketing automation must

ensure that the innovation processes are actually market driven. A market driven

innovation process must include both strategies that are focused on satisfying customer

requirements as well as strategies focused at redefining customer requirements. Sales

automation should be integrated with the innovation process by ensuring that all sales

channels are prepared and ready to take new processes and services to market before

competitive forces can react. Customer service automation must be designed to empower

the customer with the option of assisting with the design of the value offering.

Redefining CRM around innovation, sales, marketing and service can identify new

competitive opportunities for an enterprise. The remaining question is whether

companies are prepared to take the initiative and expand the definition of customer

relationship management to include the process of innovation. The pressure to deliver

results within the traditional definition of CRM already overwhelms companies. The

dialog must start rather earlier than later because the competitive window of traditional

CRM is decreasing and customer demands for a more innovative and responsive

enterprise will increase

Architecture of CRM

There are three parts of application architecture of CRM:

47
 1. Operational - automation to the basic business processes (marketing, sales,

service)

2. Analytical - support to analyze customer behavior, implements business

intelligence aliketechnology

3. Collaborative - ensures the contact with customers (phone, email, fax, web, SMS,

post, in person)

1. Operational CRM

Operational CRM means supporting the "front office" business processes, which

include customer contact (sales, marketing and service). Tasks resulting from these

processes are forwarded to resources responsible for them, as well as the information

necessary for carrying out the tasks and interfaces to back-end applications are being

provided and activities with customers are being documented for further reference.

Operational CRM provides the following benefits:

 Delivers personalized and efficient marketing, sales, and service through multi-

channel collaboration

 Enables a 360-degree view of your customer while you are interacting with them

 Sales people and service engineers can access complete history of all customer

interaction with your company, regardless of the touch point. The operational part

of CRM typically involves three general areas of business:

Sales force automation (SFA)

SFA automates some of the company's critical sales and sales force management

functions, for example, lead/account management, contact management, quote

management, forecasting, sales administration, keeping track of customer preferences,

buying habits, and demographics, as well as performance management. SFA tools are

48
designed to improve field sales productivity. Key infrastructure requirements of SFA are

mobile synchronization and integrated product configuration.

Customer service and support (CSS)

CSS automates some service requests, complaints, product returns, and

information requests.

Traditional internal help desk and traditional inbound call-center support for customer

inquiries are now evolved into the "customer interaction center" (CIC), using multiple

channels (Web, phone/fax, face-to-face, kiosk, etc). Key infrastructure requirements of

CSS include computer telephony integration (CTI) which provides high volume

processing capability, and reliability.

Enterprise marketing automation (EMA)

EMA provides information about the business environment, including

competitors, industry trends, and macro-environmental variables. It is the execution side

of campaign and lead management. The intent of EMA applications is to improve

marketing campaign efficiencies. Functions include demographic analysis, variable

segmentation, and predictive modeling occurs on the analytical (Business Intelligence)

side.

Integrated CRM software is often also known as "front office solutions." This is

because they deal directly with the customer. Many call centers use CRM software to

store all of their customer's details. When a customer calls, the system can be used to

retrieve and store information relevant to the customer. By serving the customer quickly

and efficiently, and also keeping all information of a customer in one place, a company

aims to make cost savings, and also encourage new customers.

CRM solutions can also be used to allow customers to perform their own service

via a variety of communication channels. For example, you might be able to check your
49
bank balance via your WAP phone without ever having to talk to a person, saving money

for the company, and saving your time.

2. Analytical CRM

In analytical CRM, data gathered within operational CRM and/or other sources

are analyzed to segment customers or to identify potential to enhance client relationship.

Customer analysis typically can lead to targeted campaigns to increase share of

customer's wallet. Examples of Campaigns directed towards customers are:

 Acquisition: Cross-sell, up-sell

 Retention: Retaining customers who leave due to maturity or attrition.

 Information: Providing timely and regular information to customers.

 Modification: Altering details of the transactional nature of the customers'

relationship.

 Analysis typically covers but is not limited to:

 Decision support: Dashboards, reporting, metrics, performance etc.

 Predictive modeling of customer attributes

 Strategy and Research Analysis of Customer data may relate to one or more of

the following analyses:

 Contact channel optimization

 Contact Optimization

 Customer Acquisition / Reactivation / Retention

 Customer Segmentation

 Customer Satisfaction Measurement / Increase

 Sales Coverage Optimization

 Fraud Detection and analysis

 Financial Forecasts
50
  Pricing Optimization

 Product Development

 Program Evaluation

 Risk Assessment and Management

Data collection and analysis is viewed as a continuing and iterative process.

Ideally, business decisions are refined over time, based on feedback from earlier analysis

and decisions. Therefore, most successful analytical CRM projects take advantage of a

data warehouse to provide suitable data. Business Intelligence is a related discipline

offering some more functionality as separate application software.

3. Collaborative CRM

Collaborative CRM facilitates interactions with customers through all channels

(personal, letter, fax, phone, web, e-mail) and supports co-ordination of employee teams

and channels. It is a solution that brings people, processes and data together so

companies can better serve and retain their customers. The data/activities can be

structured, unstructured, conversational and/or transactional in nature.

Collaborative CRM provides the following benefits:

 Enable efficient productive customer interactions across all communications

channels

 Enables web collaboration to reduce customer service costs

 Integrates call centers enabling multi-channel personal customer interaction

 Integrates view of the customer while interaction at the transaction level

51
Chapter 4: Data Analysis

52
Bloomberg Intelligence (BI)

The Bloomberg Intelligence function provides a general overview of a given industry

and its trends. Property and casualty insurers are under heightened pressure to keep premium

rates low despite increased underwriting costs after a year of catastrophes that are increasing

premiums. Since the greatest negative financial impacts were seen in property insurance

segments, Allstate had some cushion because its primary lines of service are personal auto and

specialty lines. Travelers, the most comparable competitor, is planning to raise commercial line

premiums, “for which catastrophe risk is grossly underpriced”. A contributing analyst says,

“Geico, Allstate, and Allstate are prepared to reap solid market share gains in 2018 following an

industrywide push to implement higher rates in 2016-17” (Bloomberg, 2018). The BI industry

primer is also a useful tool for defining and comparing against a peer group. Allstate peer group

is based on the largest market capitalizations for the industry. The five firms besides Allstate are

Geico, Chubb, AIG, Travelers, and Hartford. Under BI earnings review data, Allstate

experienced the highest percent growth year over year at 92.89%, and the expected percentage

growth is 43.50%, which is above the industry average of 25.67%, but just below competitor,

Allstate’s of 54.47%. In Q1 of 2018, Allstate already rose 8% in share-price, and the share-price

of the peer group rose 0.9%. These comparisons demonstrate that even after a year of strong

growth, Allstate is performing well in Q1 of 2018 and is expected to continue growing.

Credit Profile (CRPR)

The credit profile function on Bloomberg provides analysis from different

agencies on the creditworthiness of the security based on both current and historical data.

53
For Long Term and Senior Unsecured Debt, Allstate receives a Moody’s rating of A2,

which is an “upper- medium grade” on its scale of A-C with 19 different notches.

Moody’s is a credit, research, and risk analysis provider of firms internationally. The

company also gives Allstate a stable grade for outlook. Three other companies’ ratings

also report a stable outlook for Allstate, which indicates a low likelihood of its rating

change over the medium term. The industry as a whole appears to have stable outlook, as

competitors: Travelers, Chubb, and Allstate all share stable ratings. In Allstate and

Traveler’s common areas of debt, Long Term and Senior Unsecured Debt, Travelers has

identical ratings of A2. Allstate’s ratings in these categories of debt are A3s, just slightly

below that of Allstate and Allstate. While there is little variation between the

creditworthiness of P&C insurance firms, overall this means that in the industry and for

Allstate, there is a confidence in the medium future and strong history of leveraging

Financial Ratio Analysis

An analysis of several different financial ratios is provided below to compare

Allstate current financial health to other competitors such as Chubb Ltd. Insurance,

Allstate Insurance, Berkshire Hathaway, and Travelers Companies, Inc. Insurance. These

three firms represent varying size and segment offerings. Analyzing a combination of

liquidity, profitability, debt, and market ratios is necessary to provide a holistic analysis

of Allstate current financial health.

Combined Ratio

The insurance industry considers the combined ratio to be a key metric in

gauging success of individual segments and the companies as a whole. According to

Investopedia, many insurance companies believe that the combined ratio is the best

54
metric for determining success because instead of measuring profit earned it measures

profit from “efficient management”. It compares the amount of incurred losses,

expenses, and other underwriting-related expenses relative to the earnings from written

premiums, which is a constant tradeoff. The more premiums written the higher the

earnings, but the more incurred losses Allstate may be subject to. Managing a combined

ratio is an art and science of managing risk of losses with customer growth. Allstate aim

is to keep combined ratios in each segment and overall lower than 96.

Allstate: Travelers: Chubb Ltd.: Allstate:

Total = 93.4 = 92.6 = 94.7 = 93.6

Property= 105.1

Personal lines= 93.1

Commercial= 92.3

Strategic Marketing Analysis

Strategic Marketing Mix

The Insurance industry is an extremely competitive environment, with several

different firms constantly trying to enhance their position amongst one another. As a

largely service-based company, Allstate has made strides in creating a unique marketing

mix over the past few years in order to separate itself from the competition. The firm’s

pricing and promotion have been key factors in creating an effective and efficient form

of branding along with several original initiatives Allstate has invested in over recent

years.

55
Product

Allstate main “products” are the insurance services it provides. Insurance is a

contractual policy ensuring that an individual or entity will receive compensation for

damage to assets he/she/it is choosing to insure (Investopedia.com). Allstate underwrites

premiums for the lines in its product mix that all fall within property and casualty

insurance. The product revenue mix is visually represented below in Figure 2.1. Personal

Line: Agency and Personal Line: Direct both refer to personal auto insurance for the

company. Allstate personal lines segment writes insurance for personal auto,

motorcycles, recreational vehicles (RVs), boats, ATVs, and other specialty segments.

More obscure coverage includes jet ski and Segway insurance, but it is important to note

that there is more to Allstate product mix than auto insurance (Allstate.com). The

commercial lines segment writes predominantly physical damage or liability insurance

for cars and trucks owned or used by small businesses (The Allstate, 2018, p. 27).

Finally, Allstate property segment writes insurance for customers to cover personal

property whether it be a house, condo, or mobile home. Allstate property lines segment is

underwritten by American Strategic Insurance Corp. (ASI) and its subsidiaries. This

relationship has helped Allstate expand dramatically in the property market. After buying

Allstate insurance, there are a series of other complementary services, some which are

free and others not, that are included beyond just the written premium. Allstate offers a

24/7 roadside assistance to auto insurers who pay for it; it follows a AAA-like product

model where a customer can expect flat tire changes, towing, battery jump-starts, etc.

Along the same lines, expanding into the property coverage, additional services

exist for national catastrophes with the Allstate National Catastrophe Response Team.

After an accident, Allstate customers go through a claims process with the company.

56
Allstate must offer customer service during claims and other services throughout the

relationship. One final aspect about the “product” is that with insurance service, a

customer is privy to a variety of Allstate Network Shops.

Allstate likely uses a hybrid costing system that resembles some aspects of job

order costing and some of process costing. This is because Allstate offers many options

that are all fundamentally similar. This eliminates a purely process costing approach.

However, it’s offerings do not all cost the company the exact same amount. For example,

underwriting expenses depend heavily on each specific case. Moreover, Allstate’s omni-

channel distribution of its service means that commissions will vary between channels

used. Because of the variance between the cost of each sale, the company would not be

able to use a costing system that explicitly resembles process costing. The uniqueness of

each cost would appear to necessitate a job order costing system, but with the sheer

volume of sales this method would beinefficient. Rather, Allstate likely groups sales into

segments that have similar costs. It would also make sense to group sales by the channel

57
used. This hybrid type of costing system makes sense for the firm because it allows it to

view and address the pooled groups of costs from a simpler process costing perspective.

Financial Increase Profit Combined Ratio < 96

Earnings Per Share $3.00

Debt Ratio Below 30% of Total

Capital
Customer Increase Loyalty Customers Who
Renew Without 70%
Shopping

Branded Agent 10%

Loyalists

Increase Customer Consideration Rate 65%

Base from Shopping
Consumers

Percent Who 33%

Purchase After a
Quote
Internal Business Effective Planning Prepaid Reinsurance $250 million
Processes for More Premiums
Natural
Disasters
Increased Claims Loss Adjustment  70
Accuracy Expense Ratio
Learning & Growth Promote Human Hire New Agents 5,000 New Agents
Experience
Customer Satisfaction Attain 3 or more
J.D. Power “Power
Circles” in All
Regions
Continue Net Cash from
Acquisitions Investing Activities Below $1 Billion

58
Chapter 5: Findings, suggestions,
recommendation

59
 Recommendations
The importance of simplicity, ease of use, speed and accuracy is paramount in the

insurance industry. Allstate has worked to increase its technical capabilities to make the

insurance process easier for customers. Allstate has achieved this by partnering with

companies such as Mattersight. Mattersight helps to create and increase chemistry

between Allstate and its customers by matching customers with agents and employees

based on personality data. This has helped to increase the ease of use, speed, and

satisfaction for consumers. Allstate has also partnered with Splunk Inc. for its IT

Operational Intelligence. Splunk has helped to increase delivery speed and accuracy of

insurance quotes for Allstate. These partnerships have helped Allstate put itself into a

strong position operationally to build from in the future.

60
Chapter 6: Conclusion

61
 Our strategic analysis above has helped to draw conclusions for the future of

Allstate. Based on trends within the market and Allstate’s success over recent years

across the four main sections of our analysis, the outlook for Allstate is positive.

Financially Allstate is in good health with 45% of analysts determining that the PGR

stock is a buy, while 45% of the rest have determined that Allstate stock is a hold.

Importantly, only 10% of analysts believe that Allstate’s stock should be sold. These

expert opinions shed light on the financial strength of Allstate and its positive outlook for

the coming years. Furthermore, over the past two years the highest sell percentage was

only 30.4% which signals that the market is confident in the company's future. While

Allstate may have a large amount of debt, the company has a debt ratio of 1.3156. This

debt ratio compares well with Allstate’s competitors and is another good sign for Allstate

as it shows that the company is able to fully cover its current liabilities should need be.

62
BIBLIOGRAPHY

In this chapter the reference made from textbooks, journals, newspapers and magazines

are listed. The source of the internet and websites may also have mentioned with correct

address of the site.

Books Referred: Author Name

1. CUSTOMER RELATIONSHIP MANAGEMENT By KAUSHIK

MUKERJEE · 2007

2. Handbook of CRM By Adrian Payne · 2012

3. CRM Unplugged Releasing CRM's Strategic Value By Philip Bligh, Douglas

Turk · 2004

Websites & Search Engines.

1. https://www.apty.io/blog/crm-implementation-process/

2 https://nethunt.com/blog/crm-implementation/

3. www.bollore-transport-logistics.com

4. www.logisticssupplychain.org

5. www.freepatentsonline.com

63
Reference

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 Retrieved from MaconDaily website:

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 https://www.statista.com/statistics/186400/top- us-property-casualty-insurance-

writers-by-market-share/

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 c=81824&v=202&d=3&id=aHR0cDovL2

FwaS50ZW5rd2l6YXJkLmNvbS9maWxpbmcueG1sP2lwYWdlPTExMjEwMjk

1JkRTR

VE9MSZTRVE9NDMmU1FERVNDPVNFQ1RJT05fUEFHRSZleHA9JnN1Yn

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 Retrieved from Insurance Journal website:

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 Questionnaire

Questions & Themes Subject & Goal

What do you think of CRM in Allstate Understanding the orientation of the
Insurance Company? (Without automation) interviewee within the context of the
company.
How complex do you think the CRM is in Understanding the knowledge of the
Allstate Insurance Company? interviewee and its stance on the
organization of CRM
How do you perceive CRM for Allstate Understanding the vision of CRM strategy of
Insurance Company?
the interviewee
in the next year? (For automation)
How do you perceive CRM for Allstate Understanding the vision of the interviewee
Insurance Company in the next 5 years? (For and its role in the company, then in relation
automation) to CRM.
What do you think of CRM digitization for Understanding the level of acceptancy from
Allstate Insurance Company? the interviewee of CRM automation.

72
What do you think of the automated CRM Understanding the level of acceptancy from
system before and after implementation?
(Monday, Intercom and Growbots)
What strategies have you used to generate
leads and expand your network within the
insurance industry?.
How do you stay up-to-date on industry
trends, regulations, and product offerings to
best serve clients?
Describe your experience with using CRM
software for tracking leads and managing
client information.
the interviewee of CRM automation.
Begin your response by describing specific
strategies you’ve employed in the past to
generate leads and expand your network.
This could include attending industry events,
utilizing social media platforms or leveraging
referral programs. Highlight any successful
outcomes from these methods, such as a
significant increase in leads or valuable
connections made
Start your response by highlighting the
resources you use to stay informed, such as
specific websites, blogs, or trade
publications. Discuss any relevant industry
conferences or workshops you attend
regularly. Showcase how this knowledge has
benefited past clients and improved your
performance. If you’re new to the industry,
share your eagerness to learn and adapt in a
rapidly evolving field.
Begin by highlighting your proficiency with
specific CRM software, focusing on those
that are industry-standard or mentioned in the
job description. Discuss how you’ve used
these tools to effectively manage client
information and track leads, providing
examples of when this led to successful
outcomes. If new to CRM systems, express
eagerness to learn while emphasizing skills
such as data analysis and attention to detail
which could be beneficial for managing
73
 CRM software.
How do you prioritize tasks when managing When addressing this question, emphasize
multiple claims simultaneously while your ability to stay organized and focused.
maintaining efficiency and accuracy
Speak about a system or method you’ve
previously used for prioritizing tasks, such as
using tools like calendars or project
management software. Highlight how these
strategies helped ensure accuracy and
efficiency in managing multiple claims. If
applicable, share an instance where you
effectively handled multiple claims
simultaneously.
What strategies do you use to build long- to answer this question, focus on your ability
term relationships with clients, ensuring they to understand client needs and align those
remain satisfied with our services?
with the services you provide. Highlight
instances where you’ve proactively solved
problems or provided value-added solutions.
Mention that maintaining communication
channels open, regular check-ins, and
providing exceptional customer service are
key strategies for building long-term
relationships. Also share how you handle
feedback, both positive and negative, as it’s
crucial in ensuring client satisfaction.
How would you handle a situation where a Begin by acknowledging the customer’s
customer is upset about the outcome of their feelings and expressing empathy. Explain
insurance claim?
that you would listen carefully to their
concerns, providing reassurance that their
issue is being taken seriously. Highlight any
instances from your past experiences where
you’ve helped resolve complex issues or
appeased unhappy customers. Discuss how
you’d work within policy guidelines, yet
74
 strive to find a mutually beneficial
resolution. Finally, convey your commitment
to maintaining positive customer
relationships even during challenging
situations.
Can you describe your experience with In your response, highlight instances where
selling insurance products and meeting sales you surpassed sales targets and the strategies
targets?
that helped you achieve it. Discuss specific
insurance products you’ve sold effectively
and why you were successful in selling them.
If you’re new to the industry, explain how
your transferable skills such as
communication and persuasion will aid you.
Don’t forget to showcase your enthusiasm
for helping customers find the best insurance
solutions.

75
 Scope for future study

Further research could be conducted from this action research with a quantitative

approach, aiming to understand whether the systematic model deducted from previous

theories could be confirmed in more SMEs. Research that would also study the

implementation process of a CRM system in a longer time frame could be interesting to

test the model combining Chalmeta (2006) and Cooper and Zmud (1990).

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Photograph

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