Busy August pushes Allstate’s current aggregate year pre-tax cat losses to $3.15bn

A busy August in catastrophe loss terms from severe weather activity has resulted in large US insurer Allstate reporting $748 million in pre-tax losses, which has lifted the total across the current annual aggregate risk period for its catastrophe bonds to $3.15 billion so far.

This remains a notably heavy start to the annual aggregate year for Allstate’s pre-tax overall catastrophe losses. However, as we’ve highlighted before, not all of these cat losses will qualify to erode the cat bond aggregate retentions.

Allstate begun the new annual aggregate risk period, that its Sanders Re program catastrophe bonds and aggregate excess of loss reinsurance are subject to, with $870 million of pre-tax catastrophe losses in April 2026.

Allstate then reported a much lower $289 million in May, which was followed by $563 million in pre-tax losses for June, and an additional $682 million for July.

For August 2026, Allstate has now reported $748 million in pre-tax catastrophe losses for the month, or $591 million after-tax.

The insurer explained that these losses came from 21 separate loss events and reported that 50% of the month’s losses were related to one wind and hail event, likely some of the severe convective storm activity that was seen in August across the United States.

July and August were particularly busy months in catastrophe loss terms for Allstate, with the two-month period generating a combined $1.43 billion in pre-tax losses, or $1.13 billion, after-tax

Allstate currently has annual aggregate protection from only one cat bond tranche, the $150 million Class B tranche of notes issued through its Sanders Re III Ltd. (Series 2023-1) catastrophe bond sponsorship.

For the new annual risk period, those notes attach at $4.78 billion of losses, running across a share to $5.28 billion for Allstate, and also covers losses across all US states except Florida.

As we’ve explained, the Class B tranche of notes are subject to a $50 million per-event deductible, which means only cat loss events that result in $50 million or greater will qualify to erode the retention sitting beneath their attachment.

Given this, it’s impossible for us to know how much of August’s catastrophe losses have qualified under the terms of Allstate’s aggregate Sanders Re catastrophe bonds given the $50 million per-event deductible in-force within their coverage terms. However, the fact 50% of August’s losses came from one event suggest that catastrophe is likely to have qualified.

We also reported earlier this year, that as part of its 2026 reinsurance renewal, Allstate purchased a new $1 billion aggregate excess of loss reinsurance arrangement, which attaches high up at $8.5 billion of losses.

It’s important to remember that this new $1 billion of aggregate reinsurance limit only features a smaller $1 million event deductible. With this mind, it is safe to assume that the majority of Allstate’s catastrophe losses for covered events are expected to qualify to erode the retention beneath this reinsurance layer.

As a result, this still means only an as-yet-unknown portion of Allstate’s $3.15 billion pre-tax losses will actually qualify towards eroding the cat bond retention, while more of it likely erodes the retention for the excess-of-loss reinsurance.

View details of every catastrophe bond ever sponsored by Allstate here.