Allstate 2012 Annual Report Download - page 257

Cash flows
There was no required cash contribution necessary to satisfy the minimum funding requirement under the IRC for
the tax qualified pension plans as of December 31, 2011. The Company currently plans to contribute $417 million to its
pension plans in 2012.
The Company contributed $41 million and $35 million to the postretirement benefit plans in 2011 and 2010,
respectively. Contributions by participants were $20 million and $22 million in 2011 and 2010, respectively.
Estimated future benefit payments
Estimated future benefit payments expected to be paid in the next 10 years, based on the assumptions used to
measure the Company’s benefit obligation as of December 31, 2011, are presented in the table below. Effective January 1,
2010, the Company no longer participates in the Retiree Drug Subsidy program due to the change in the Company’s
retiree medical plan for Medicare-eligible retirees.
Postretirement benefits
($ in millions)
Gross
Pension benefit
benefits payments
2012 $ 310 $ 42
2013 319 43
2014 350 45
2015 362 47
2016 396 49
2017-2021 2,467 272
Total benefit payments $ 4,204 $ 498
Allstate 401(k) Savings Plan
Employees of the Company, with the exception of those employed by the Company’s international, Sterling Collision
Centers (‘‘Sterling’’), Esurance and Answer Financial subsidiaries, are eligible to become members of the Allstate 401(k)
Savings Plan (‘‘Allstate Plan’’). The Company’s contributions are based on the Company’s matching obligation and
certain performance measures. The Company is responsible for funding its anticipated contribution to the Allstate Plan,
and may, at the discretion of management, use the ESOP to pre-fund certain portions. In connection with the Allstate
Plan, the Company has a note from the ESOP with a principal balance of $22 million as of December 31, 2011. The ESOP
note has a fixed interest rate of 7.9% and matures in 2019. The Company records dividends on the ESOP shares in
retained income and all the shares held by the ESOP are included in basic and diluted weighted average common shares
outstanding.
The Company’s contribution to the Allstate Plan was $48 million, $36 million, and $78 million in 2011, 2010 and
2009, respectively. These amounts were reduced by the ESOP benefit computed for the years ended December 31 as
follows:
($ in millions) 2011 2010 2009
Interest expense recognized by ESOP $ 2 $ 2 $ 2
Less: dividends accrued on ESOP shares (2) (2) (2)
Cost of shares allocated 2 2 2
Compensation expense 2 2 2
Reduction of defined contribution due to ESOP 9 11 22
ESOP benefit $ (7) $ (9) $ (20)
The Company made no contributions to the ESOP in 2011, 2010 and 2009. As of December 31, 2011, total
committed to be released, allocated and unallocated ESOP shares were 0.2 million, 34 million and 5 million,
respectively.
Allstate has defined contribution plans for eligible employees of its Canadian, Sterling, Esurance and Answer
Financial subsidiaries. Expense for these plans was $7 million, $5 million and $6 million in 2011, 2010 and 2009,
respectively.
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