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Clothing, furniture, and insurance The largest publicly-traded U.S. home and auto insurer, Allstate currently keeps over 20 million policy holders in its "good hands." Insurance broker Carl Odell and Sears president Robert Wood came up with the idea for Allstate during a 1930 bridge game on a Chicago commuter train. Named after a popular brand of Sears tires, Allstate followed Sears into the retail world and sold its insurance policies next to Sears furniture and clothing. Spinning off business Sears began to drop out of the financial services business in 1993, and the retail giant spun off Allstate as a separate company in 1995. Suffering $4 billion in combined losses from the Northridge, CA earthquake and Hurricane Andrew in Florida, Allstate passed off some of its riskiest policies to other companies in 1996. Allstate also sold off its real estate portfolio for nearly $1 billion to a private investment fund. Okay buddy, let's see that law degree The company has been hit hard recently with a number of state lawsuits, including Pennsylvania, Illinois and West Virginia, alleging Allstate illegally practiced law by persuading non-policy holders not to seek counsel when involved in accidents with Allstate customers. Allstate may also pay $120 million to settle a lawsuit accusing the company of inflating replacement costs for damaged homes. In February 2000, a group of dissident agents announced it would file a federal class action accusing Allstate of unfair labor practices. They claimed they were owed overtime pay and damages as a result of a 1999 company mandate requiring agents to keep offices open during set evening and weekend hours. Steady as she goes Despite the legal snafus, Allstate has been performing well as a business. In 1998, the company posted its fourth consecutive year of record profits. In September 1998, Chairman and CEO Jerry Choate announced his retirement from Allstate, handing over the position to Edward Liddy, President and COO. Liddy, who took over in January 1999, vowed to continue the strategy he developed with Choate although the new CEO will focus on generating revenue instead of cutting costs by overhauling Allstate's claim processing system and doubling sales of homeowners' insurance to eight to nine percent a year. Come together Still, although the company boasts 15,000 agents and is the second-largest personal line insurer in the U.S., in the wake of the repeal of the Glass-Steagall Act mergers such as those between insurance giants AIG and SunAmerica and Travelers Group have spawned talk of an Allstate merger. And despite the firm's steady profitability increases, new CEO Liddy believes that the company's growth is not rapid enough for Wall Street to consider Allstate a growth company; the company is looking for acquisitions to accelerate its growth. In keeping with this mentality Allstate agreed to purchase American Heritage Life Investment Corporation in July of 1999. That same year, Allstate bought the personal-lines unit of CNA Financial's insurance business, adding CNA's 3,800 independent agents. In 2000 Allstate has become the subject of takeover rumors itself as the banking, insurance, and securities industries have consolidated. Time to restructure For years, Allstate refused to yield to pressures to streamline and cut down its workforce, claiming its sparkling clean brand depended on superior customer service. But in 1999, the company was forced to give in to the pressure from the Internet. Allstate announced that it was going to cut 4,000 non-agent jobs and start giving customers the option of buying insurance policies over the Internet or via telephone. To finance the move into Internet services, the company plans to reduce annual expenses by $600 million through layoffs, the closing of a field support center, and the closing of four regional offices. In 2000 the company announced to its captive agents (about 6,000 out of 15,000) that it had set a June 1 deadline for them to either convert to contractor status or leave the company with a buyout package. The plan was criticized by some agents because the company would no longer have to pay for health insurance benefits or withhold Social Security taxes on behalf of these agents.
Allstate scans resumes into a database where they remain for up to 12 months. When Allstate recruiters are interested in filling positions, they then make a skill profile and search for matches against the database. Positions are regularly open in the Sales, Information Technologies, Finance & Marketing, and Claims departments. Specific information on a wide variety of openings can be found on Allstate employment web page, located at www.allstatecareers.com. The web page offers applicants the opportunity to fill out an online resume form; applicants can also submit a resume via the post office, fax, or e-mail. Allstate recruits at universities across the country. "We also do a fair amount of advertising and employees are encouraged to refer individuals and offered a nice reward if someone is hired and stays beyond the probationary period," says one employee. Candidates expected to complete a standardized skills test. Explains one insider: "They include a behavior analysis as part of the interview process. You will usually talk to three managers, on three different occasions, before you are hired, plus take a standardized test." Being bilingual is also a big plus at Allstate. "There are HUGE opportunities for those knowing languages other than English," reports one insider. "In fact, we are heavily recruiting agents who are Spanish speaking as we recognize growth in that sector of the market. We are also pushing into the international markets in Japan, Germany, and France."
All in the family Allstate employees are "proud" to be in the "business of helping people." The "above average" pay earns praise, and working parents laud perks such as scholarships for employee children and on-site child development centers. Employees praise Allstate for treating its staff like "family." "This past year I underwent liver surgery," says one employee, "and everyone was very supportive. The policies regarding sick leave and opportunities to work at home made my recovery and return to work very comfortable and not all rushed." Famously formal Allstate has recently relaxed its "famously formal" dress code; employees now "commonly" dress in business causal attire although "jeans, skirts that are extremely short, and shirts without collars or with printed slogans or advertising on them" are prohibited. The decentralized structure allows for "some office autonomy," but many employees comment on the company's "inflexible response" to suggestions for changing corporate procedures. Says one claims department insider: "The corporate culture is very bureaucratic, so you must learn to go with the flow." However, insiders note that one's experience differs greatly depending on whether you work for Allstate as a company employee or as an agent. As one agent explains, "I run my own agency like it is my own business, and due to some recent changes at Allstate, I can become the owner of my agency when I am ready to make the decision to change my employment status with the company." Reports another: "As an agent, you will be employed by Allstate for 18 months. After that you become independent. Allstate does not charge you for this franchise and actually puts in about $100,000 for training, furniture, equipment and salary." Sums up another contact: "As an agent, you make as much money as the time, money, and effort you put into the business." Improving record for diversity Hours vary, especially for agents, but for company employees, "most people work from 8:00-4:30 p.m." or "7 3/4 hours per day excluding lunch but including two-20 minute coffee breaks, which only some people regularly take." Employees give Allstate high marks for hiring women managers ("Allstate has been recognized by Working Women magazine as one of the top companies for women to work for," says one employee) and being committed to diversity. "Although women are still not on par numbers wise in upper management positions, the gap has closed significantly in recent years," says one employee. Allstate is also involved with community service through its Helping Hands program which allows employees to volunteer in soup kitchens, revitalize neighborhoods, and help the elderly.
Joan M. Crockett Human Resources (800) 340-0475
Business Insurance;Life insurance;Fixed annuity;Personal property/ casualty insurance;Variable annuity
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