Allstate, From Tires to Insurance Giant

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.

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. 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.

Lessing J. Rosenwald was Allstate’s first board chairman, and Odell was named vice president and secretary.

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.

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 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.

In 1949, the Allstate Headquarters Building was completed at 3245 W. Arthington Street in Chicago as a part of the Sears, Roebuck and Company Complex. 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.

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. (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.

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 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.

In 1984, Neighborhood Office Agent program was introduced to make agents more accessible to customers.

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

In 1991, the company went public before becoming completely independent in 1995.

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.

In 1993, Allstate went public when Sears sold 19.8% of the company. At the time, it was the largest IPO to date.

In 1996, their website was launched.

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. 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 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.

In 2003, actor Dennis Haysbert became Allstate’s spokesman, using the tagline “That’s Allstate’s stand.”

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, Progressive, and GEICO.

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. 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.

In 2018, Allstate collaborated with the Red Cross to distribute 1,000 disaster kits statewide in Hawaii.

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.

In July 2020, Allstate announced it was acquiring National General for $4 billion. The deal closed in January 2021.

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. One of the divested businesses was Allstate Life Insurance Company of New York, which became part of Wilson 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.