Allstate to trim retirement benefits
Less than a month after it laid off more than 300 workers, Allstate Corp. announced on Monday plans to trim employee retirement benefits.
The Northbrook-based company said the move will boost its book value from $1.70 to $2 per share.
Jim Ryan, a senior analyst at Morningstar Inc., said the move will be difficult for employees but that it’s what the market dictates.
“That’s certainly something common among a lot of companies,” he said. “To the extent that if a lot of companies do it and others don’t, those [who] don’t are disadvantaged on a cost basis.”
Ryan also said he believed that Allstate would have a strong future because of plans to broaden its e-surance and online customer base.
Beginning this summer, the company will no longer offer life insurance to its retirees and introduce a new formula for employee pensions, reducing its contribution obligation.
Aimee Chen is a WBEZ business reporting intern. Follow her at @AimeeYuyiChen.