Allstate (ALL)

12.  Company Restructuring

       The Company undertakes various programs to reduce expenses. These programs generally involve a reduction in staffing levels, and in certain cases, office closures. Restructuring and related charges include employee termination and relocation benefits, and post-exit rent expenses in connection with these programs, and non-cash charges resulting from pension benefit payments made to agents in connection with the 1999 reorganization of Allstate's multiple agency programs to a single exclusive agency program. In 2009, restructuring programs primarily relate to Allstate Protection's claim office consolidations, initiatives to improve efficiency and prioritization of technology operations, and reorganization of Business Insurance, as well as Allstate Financial's initiative to lower operating expenses. The expenses related to these activities are included in the Consolidated Statements of Operations as restructuring and related charges, and totaled $130 million, $23 million and $29 million in 2009, 2008 and 2007, respectively.

       The following table presents changes in the restructuring liability for the year ended December 31, 2009.

       The payments applied against the liability for employee costs primarily reflect severance costs, and the payments for exit costs generally consist of post-exit rent expenses and contract termination penalties. As of December 31, 2009, the cumulative amount incurred to date for active programs totaled $174 million for employee costs and $45 million for exit costs.

8.  Company Restructuring

The Company undertakes various programs to reduce expenses.  These programs generally involve a reduction in staffing levels, and in certain cases, office closures.  Restructuring and related charges include employee termination and relocation benefits, and post-exit rent expenses in connection with these programs, and non-cash charges resulting from pension benefit payments made to agents in connection with the 1999 reorganization of Allstate’s multiple agency programs to a single exclusive agency program.  The expenses related to these activities are included in the Condensed Consolidated Statements of Operations as restructuring and related charges, and totaled $45 million and $(1) million for the three-month periods ended March 31, 2009 and 2008, respectively.

The following table illustrates the changes in the restructuring liability during the three-month period ended March 31, 2009:

The payments applied against the liability for employee costs primarily reflect severance costs.

12.  Company Restructuring

        The Company undertakes various programs to reduce expenses. These programs generally involve a reduction in staffing levels, and in certain cases, office closures. Restructuring and related charges include employee termination and relocation benefits, and post-exit rent expenses in connection with these programs, and non-cash charges resulting from pension benefit payments made to agents in connection with the 1999 reorganization of Allstate's multiple agency programs to a single exclusive agency program and the Company's 2006 voluntary termination offer ("VTO"). The expenses related to these activities are included in the Consolidated Statements of Operations as restructuring and related charges, and totaled $23 million, $29 million and $182 million in 2008, 2007 and 2006, respectively.

        The following table illustrates the inception to date changes in the restructuring liability:

        Restructuring and related charges included $94 million in 2006 related to the Company's VTO and reduction in force. The VTO included severance, which was recorded as a restructuring liability and fully settled during 2006. The VTO also included one-time termination benefits for accelerated vesting of stock-based incentive compensation, eligibility for postretirement benefits, and a non-cash pension settlement charge recorded during the third quarter of 2006, which were expensed as incurred. The VTO was offered to most employees located at the Company's headquarters.

        At December 31, 2007, the total liability was $25 million and consisted of $23 million in employee costs and $2 million in exit costs. The payments applied against the liability for employee costs primarily reflect severance costs, and the payments for exit costs generally consist of post-exit rent expenses and contract termination penalties.

197

13.  Commitments, Guarantees and Contingent Liabilities

12.  Company Restructuring

        The Company undertakes various programs to reduce expenses. These programs generally involve a reduction in staffing levels, and in certain cases, office
closures. Restructuring and related charges include employee termination and relocation benefits, and post-exit rent expenses in connection with these programs, and non-cash
charges resulting from pension benefit payments made to agents in connection with the 1999 reorganization of Allstate's multiple agency programs to a single exclusive agency program and the Company's
2006 voluntary termination offer ("VTO"). The expenses related to these activities are included in the Consolidated Statements of Operations as restructuring and related charges, and totaled
$23 million, $29 million and $182 million in 2008, 2007 and 2006, respectively.

        The
following table illustrates the inception to date changes in the restructuring liability:

        Restructuring
and related charges included $94 million in 2006 related to the Company's VTO and reduction in force. The VTO included severance, which was recorded as a
restructuring liability and fully settled during 2006. The VTO also included one-time termination benefits for accelerated vesting of stock-based incentive compensation, eligibility for
postretirement benefits, and a non-cash pension settlement charge recorded during the third quarter of 2006, which were expensed as incurred. The VTO was offered to most employees located
at the Company's headquarters.

        At
December 31, 2007, the total liability was $25 million and consisted of $23 million in employee costs and $2 million in exit costs. The payments applied
against the liability for employee costs primarily reflect severance costs, and the payments for exit costs generally consist of post-exit rent expenses and contract termination penalties.

197

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13.  Commitments, Guarantees and Contingent Liabilities

7.  Company Restructuring

The Company undertakes various programs to reduce expenses.  These programs generally involve a reduction in staffing levels, and in certain cases, office closures.  Restructuring and related charges include employee termination and relocation benefits, and post–exit rent expenses in connection with these programs, and non–cash charges resulting from pension benefit payments made to agents in connection with the 1999 reorganization of Allstate’s multiple agency programs to a single exclusive agency program and the Company’s 2006 voluntary termination offer.  The expenses related to these activities are included in the Condensed Consolidated Statements of Operations as restructuring and related charges, and totaled $10 million and $2 million for the three–month periods ended September 30, 2008 and 2007, respectively, and $4 million and $5 million for the nine–month periods ended September 30, 2008 and 2007, respectively.

16

7.  Company Restructuring

The Company undertakes various programs to reduce expenses.  These programs generally involve a reduction in staffing levels, and in certain cases, office closures.  Restructuring and related charges include employee termination and relocation benefits, and post–exit rent expenses in connection with these programs, and non–cash charges resulting from pension benefit payments made to agents in connection with the 1999 reorganization of Allstate’s multiple agency programs to a single exclusive agency program and the Company’s 2006 voluntary termination offer.  The expenses related to these activities are included in the Condensed Consolidated Statements of Operations as restructuring and related charges, and totaled $(5) million and $4 million for the three–month periods ended June 30, 2008 and 2007, respectively, and $(6) million and $3 million for the six–month periods ended June 30, 2008 and 2007, respectively.

The following table illustrates the changes in the restructuring liability during the six–month period ended June 30, 2008:

The payments applied against the liability for employee costs primarily reflect severance costs.

15

7.  Company Restructuring

The Company undertakes various programs to reduce expenses.  These programs generally involve a reduction in staffing levels, and in certain cases, office closures.  Restructuring and related charges include employee termination and relocation benefits, and post–exit rent expenses in connection with these programs, and non–cash charges resulting from pension benefit payments made to agents in connection with the 1999 reorganization of Allstate’s multiple agency programs to a single exclusive agency program and the Company’s 2006 voluntary termination offer.  The expenses related to these activities are included in the Condensed Consolidated Statements of Operations as restructuring and related charges, and totaled $(1) million and $(1) million for the three–month periods ended March 31, 2008 and 2007, respectively.

The following table illustrates the changes in the restructuring liability during the three–month period ended March 31, 2008:

The payments applied against the liability for employee costs primarily reflect severance costs.

12.  Company Restructuring

        The Company undertakes various programs to reduce expenses. These programs generally involve a reduction in staffing levels, and in certain cases, office closures. Restructuring and related charges include employee termination and relocation benefits, and post-exit rent expenses in connection with these programs, and non-cash charges resulting from pension benefit payments made to agents in connection with the 1999 reorganization of Allstate's multiple agency programs to a single exclusive agency program and the Company's 2006 voluntary termination offer ("VTO"). The expenses related to these activities are included in the Consolidated Statements of Operations as restructuring and related charges, and totaled $29 million, $182 million and $41 million in 2007, 2006 and 2005, respectively.

        The following table illustrates the inception to date changes in the restructuring liability:

        Restructuring and related charges included $94 million in 2006 related to the Company's VTO and reduction in force. The VTO included severance, which was recorded as a restructuring liability and fully settled during 2006. The VTO also included one-time termination benefits for accelerated vesting of stock-based incentive compensation, eligibility for postretirement benefits, and a non-cash pension settlement charge recorded during the third quarter of 2006, which were expensed as incurred. The VTO was offered to most employees located at the Company's headquarters.

        At December 31, 2006, the total liability was $22 million and consisted of $20 million in employee costs and $2 million in exit costs. The payments applied against the liability for employee costs primarily reflect severance costs, and the payments for exit costs generally consist of post-exit rent expenses and contract termination penalties.

12.  Company Restructuring

        The Company undertakes various programs to reduce expenses. These programs generally involve a reduction in staffing levels, and in certain cases, office
closures. Restructuring and related charges include employee termination and relocation benefits, and post-exit rent expenses in connection with these programs, and non-cash charges resulting from
pension benefit payments made to agents in connection with the 1999 reorganization of Allstate's multiple agency programs to a single exclusive agency program and the Company's 2006 voluntary
termination offer ("VTO"). The expenses related to
these activities are included in the Consolidated Statements of Operations as restructuring and related charges, and totaled $29 million, $182 million and $41 million in 2007,
2006 and 2005, respectively.

        The
following table illustrates the inception to date changes in the restructuring liability:

        Restructuring and related charges included $94 million in 2006 related to the Company's VTO and reduction in force. The VTO included
severance, which was recorded as a restructuring liability and fully settled during 2006. The VTO also included one-time termination benefits for accelerated vesting of stock-based incentive
compensation, eligibility for postretirement benefits, and a non-cash pension settlement charge recorded during the third quarter of 2006, which were expensed as incurred. The VTO was offered to most
employees located at the Company's headquarters.

        At
December 31, 2006, the total liability was $22 million and consisted of $20 million in employee costs and $2 million in exit costs. The payments applied
against the liability for employee costs primarily reflect severance costs, and the payments for exit costs generally consist of post-exit rent expenses and contract termination penalties.