(Updates with closing share price in the fifth paragraph.)
Feb. 21 (Bloomberg) -- Allstate Corp., the largest publicly traded U.S. home and auto insurer, raised its dividend one cent a share after profit declined in 2011.
The quarterly payout will rise to 22 cents a share from 21 cents, Northbrook, Illinois-based Allstate said today in a statement. The insurer was expected to increase the payout to 23 cents a share, according to the Bloomberg Dividend Forecast.
Chief Executive Officer Thomas Wilson, 54, is raising rates for residential coverage and said in December that the homeowners business hasn’t generated acceptable returns for “some time.” Net income last year slipped 15 percent from 2010 to $788 million.
Improving the performance of the home business is “critical to achieving our 13 percent operating return-on equity-goal by 2014,” Wilson said last week at an investor conference. “In the last three years we accelerated our pricing actions.”
Return on equity for the 12 months ended Dec. 31 fell to 4.2 percent from 5.2 percent in 2010 as the insurer faced costs from catastrophes including Hurricane Irene and the tornado that struck Joplin, Missouri.
Allstate advanced 17 cents to $31.56 in New York trading at 4:01 p.m. It has gained 15 percent this year after slipping 14 percent in 2010.
The dividend is payable on April 2 to shareholders of record as of March 5. The insurer announced plans in November to buy back as much as $1 billion in shares.
--Editors: Dan Reichl, Dan Kraut
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