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Purchasing an agency as an Allstate Exclusive Agent.

Choose your own direction.

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Allstate is a proven leader in a very competitive field – insuranceand financial services.

Today, we’re continuing to strengthen our position by expandingour Exclusive Agency force, which we believe is the best in thebusiness. Proven professionals who thrive on helping customersprotect and build their tomorrows. Pros who know how to win. Pros who may be just like you.

Take a good look at your life.

Where do you want to be

five or ten years from now?

Running your own business?

Being your own boss?

Enjoying financial rewards?

If you answered, “all of the

above,” then you’ve come

to the right place.

You are here.

“I was working as a part of a support team for an insurance

agency for years and had a great feel for the business.

I always knew I wanted to run my own business. Once

I looked around, I realized that the only opportunity for me

was the Allstate Exclusive Agent opportunity. It gave me

a chance to run my own business, make my own money

and offer a wonderful array of insurance and financial

products from Allstate.”

Exclusive AgentMiami, Florida

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“My decision to purchase an agency a few years ago

has proven to be the best decision I have ever made.

Coming in the door as a new small business owner

and having the Allstate name to stand behind gives

me instant credibility. The Allstate product options

offered me what I needed to succeed.”

Exclusive AgentLaurel, Maryland

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Being the boss means your business is

your baby – you determine how it grows.

Allstate’s Exclusive Agency Program

provides you with a unique entrepreneurial

opportunity where you will have the support

and expertise of one of the country’s most

established insurance companies.

* Economic interest may be sold to Allstate-approved buyer only.

As an independent contractor, you’ll choose your own officelocation and hire your own staff. You’ll also build a book ofbusiness in which you have an economic interest.*

Where you’re the boss.

With the option of purchasing an existing Allstate Agency1,you have the advantage of buying a business that’s already up and running. In fact, you may choose the level of businessactivity based on the size of the agency you purchase. There are different bonus and incentive opportunities available depending on whether the agency has less than750 PP&C policies or more than 750 PP&C policies.

1 Allstate is not a party to the sale nor does Allstate participate in the sale negotiation oragency valuation process. Exclusive Agents have an economic interest in the customeraccounts they develop under the Exclusive Agency Agreement with the Company. ExclusiveAgents may sell their economic interests to an Allstate-approved buyer when their agencyrelationship with the Company ends. Allstate retains ownership of the book of business.

1 Allstate will provide you with information on the Exclusive Agency Program, marketinformation, and the purchase process. However, it is strongly recommended that youconsult with outside advisors (attorney, tax advisor, accountant, banker, etc.) beforepurchasing an agency from an Allstate Exclusive Agent.

Start here.

Purchasing an existing

agency1 from an Allstate

Exclusive Agent is just one

of multiple ways to become

an Allstate Exclusive Agent.

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1 The Allstate Exclusive Agent Employee Program is offered in select states.

2 Purchase, as used in this document, refers to the purchase of the economic interestin the Allstate customer accounts serviced by an agency.

3 Where available, an agent may be assigned a book(s) of business as the agent of record. The commission amounts for the assigned policies are 6% for Standard Autoand Property and 4% for Nonstandard Auto for five (5) annual renewals following thedate of assignment. The assigned policies are not eligible for inclusion in TerminationPayment calculation for five (5) annual renewals following the date of assignment.Allstate retains ownership of the assigned policies.

BECOMING AN ALLSTATEEXCLUSIVE AGENT . . .

Purchasing2 anagency from anexisting AllstateExclusive Agent

Less than 750PP&C policies

More than 750PP&C policies

Completing theExclusive Agent

Employee Program1

Starting a newagency

Being assigned3 abook of business

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Drive your business as a team o

Allstate offers you the

opportunity to team up

with a Personal Financial

Representative, a specialist

in life, savings and

financial products. There

are plenty of good reasons

to do this, including:n More revenue and economic value for your agency through

cross-selling property and casualty with financial services

n Better business retention as customers begin to call on youragency for a wide range of insurance and financial products

n More experience in financial services, sales and marketing

You can free up your time to develop other parts of your business.The only thing required of you is ongoing communication and amutual understanding of goals. The choice is yours. Team up with a Personal Financial Representative or run the show yourself.

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or on your own.“Teaming up with a Personal Financial Representative

absolutely enhances the retention of the customer,

which obviously means more commissions for the agent.

It’s just the fact that you know the customer very well.”

Exclusive AgentJacksonville, Arkansas

Independence is what

makes the Allstate Exclusive

Agent opportunity ideal

for motivated people with

sales experience. But, you’re

not set adrift on your own.

We offer the tools and

support to help you succeed

every step of the way.

Support here, there, everywhere.

Field Distribution Leaders are available to provide consultation andexpertise to help you profitably grow your agency. In addition, you’llhave access to education programs, an advanced computer system,24-hour customer service and much more.

Plus, our highly competitive commission structure and rewardingrecognition programs can help your business grow by motivatingboth you and your staff.

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The right products to help you succeed.

As an Allstate Exclusive Agent, you’ll have a comprehensive line-up of excellent,affordable products to meet the needs of the customers.

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HomeownerCondoCustomizer Business Package PolicyRentersMobile HomeBoatRecreational VehicleFloodPersonal Umbrella PolicyCommercial Property PoliciesSPP (Scheduled Personal Property)LPP (Landlord Package Policy)

PROPERTY INSURANCE

Life InsuranceAnnuitiesMutual FundsIRAsExtended Care InsuranceCDs1

Money Market AccountsDisability InsuranceSupplemental Health Insurance

FINANCIAL PRODUCTS

Preferred AutoIndemnity AutoMotorcycleMotorhomeMotorclubCommercial AutoCommercial Fleets

AUTO INSURANCE

1 Banking and savings products such as CDs are offered through Allstate Bank, Member FDIC. Non-deposit investment products sold by other companies withinthe Allstate family of companies are not insured by the FDIC, are not a deposit or other obligation of, or guaranteed by, Allstate Bank and may be subject to investment risks, including possible loss of principal amount invested. In certain states, the referral of CDs is limited by state securities laws to agents who are registered securities representatives.

As you evaluate the

opportunity to buy an

existing Allstate Agency,

here are a few questions

to ponder:

Before you decide.

n What is the business environment?

n What are the financial results of the agency?

n Is the agency an efficiently operated business?

n Will agency staff be retained after the purchase? What is theirvalue to the agency?

n What staffing issues exist?

n Will the existing location be maintained after the agency purchase?

n What factors may affect the retention of customers in the book of business?

n How will the agency purchase be financed?

n What legal issues should be considered?

For more details on any of these questions and other items toconsider, please review the appendices in the back of this brochure.

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How long does the process take?

We’ve created an easy-to-follow, four-part process that starts about a year before the effective date of sale. Yourindividual timeline may be shorter or longer, depending on your circumstances. For a more detailed look at thetimeline, please consult the appendices at the back of this brochure.

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“After a year and a half I look back and

am so thankful I made this decision

by coming aboard.”

Exclusive AgentTampa, Florida

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In today’s changing economic environment, we’re poised tocontinue our success. Many insurance companies have comeand gone, or strayed far from their roots. But we remain true to a fundamental idea – to deliver protection, peace of mind and a better quality of life to all our customers.

We’re looking for entrepreneurial sales professionals who like working with people and want to grow with us. If you’reinterested, we would like to talk with you. We may have asuccessful future in common.

To learn more, call Allstate today at 877-258-9012, or visit our website at allstateagent.com.

At Allstate, we’re right with you.

The Allstate name is one that is associated

with reliability and financial strength.

Starting in 1931, selling auto insurance

through the Sears catalog, Allstate has built

a legacy of innovation, service and success.

We are ranked among one of the Fortune 50

companies and our slogan, “You’re in

Good Hands with Allstate®,” is one of the

most widely recognized in the business.

Appendices

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APPENDIX A

Purchasing an Agency...Things to Consider.

APPENDIX B

Estimated Timeline of Key Events for an Agency Sale.

Purchasing an Agency...Things to Consider.

As you evaluate the Allstate Exclusive Agency Program to determine if purchasing an agency is the right opportunity foryou, there are several things you may want to consider. This list provides you with a starting point.

Please note that Allstate is not a party to the sale, nor does Allstate participate in the agency valuation, sale negotiation, orterms of the sale processes. We recommend you consult with your attorney, tax advisor, and other financial professionalsbefore entering into an agreement to purchase an agency from an Allstate Exclusive Agent.

Agency Valuation

Several factors may affect the value of an agency. There are companies that specialize in helping people determine thevalue of a business they may want to buy. You may find independent business valuation helpful.

To assist you in evaluating this opportunity, we've put together somecommonly-asked questions in a variety of categories.

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MARKET ANALYSIS

What is the business environment?

n Market demographicsn Volatility — regulatory changesn Catastrophe exposure and managementn Local growth strategyn Competition

FINANCIAL RESULTS

What are the financial results of the agency overthe past three years?

n Revenue growth n Number of policies n Number of householdsn Policy retentionn New business productionn Average premium per policyn Office expensesn Revenue by line of insurancen Claim results — loss trends

CUSTOMER RETENTION ISSUES

Which factors may affect the retention ofcustomers in the book of business?

n Zip code analysis of customer base n Average age of customer basen Retention of agency staffn Pending rate changesn Selling agent involvement in the agency after the salen Customer satisfaction measurementn Customer complaint volumen Rate activity in the past 12-24 months

PRODUCT MIX

What is the composition of the product andcustomer mix in the book of business?

n Mix of businessn Number of policies per householdn Business quality — underwriting guidelinesn Percent financial services businessn Percent service account business — business not written

by the agent but serviced in the location. This business ispaid at a lower compensation amount.

APPENDIX A

OPERATIONAL ISSUES

Is the agency an efficiently operated business?

n Processes for producing and retaining businessn Results measurement and trackingn Customer records and documentationn Agency use of technologyn Errors and Omissions claim history

Will agency staff be retained after the purchase?What is their value to the agency?

n Tenure of staffn Technology skillsn Sales skillsn Insurance license(s)n Customer and community relationshipsn Defined staff responsibilities

What staffing issues exist?

n Compensationn Staff trainingn Staff accountability for resultsn Staff performance evaluationsn Staff turnover

Will the existing location be maintained after the agency purchase?

n Market presencen Assume lease/subleasen Terms and conditions of leasen Tenant improvementsn Landlord relationshipn Local zoning ordinancesn Signage

PURCHASE FINANCING

How will the agency purchase be financed?

n Type of business loan and lendern Length of approval processn Lender requirementsn Capital to be investedn Repayment plan fits agency cash flow

LEGAL CONSIDERATIONS

What legal issues should be considered?

n Attorney involvement throughout the purchase process including terms of the purchase agreement

n Tax planning considerationsn Choice of entity, e.g., sole proprietor, limited

liability company (LLC), or corporationn Agency licensing requirementsn Pending lawsuits, liens, or judgments

OTHER CONSIDERATIONS

What are some of the other items I should consider?

n Licensing Requirements — in addition toproperty/casualty and life licensing, securities licensingis required. An extensive background check is completedby the NASD, (National Association of SecuritiesDealers) as part of the securities licensing process.

n Retirement planningn Commissions and commission charge backs

received after the sale on business written or terminatedbefore the sale

n Accounting decisions — responsibility for expensesincurred prior to the sale when payment is due after the sale

n Errors and Omissions insurance — extended coverage after the sale

n Key person life insurance

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Purchasing an Agency...Things to Consider (cont’d)

Estimated Timeline of Key Events for an Agency Sale.

12 MONTHS DATE OF SALE

Note: Your individual timeline may be shorter or longer dependingon your own circumstances. Additionally, the timing of your eventsmay occur earlier or later in the agency sale process.

The following steps in the agency sale process may be completed throughout the

process and at different times during the process:

n Consult with an attorney, tax advisor, and other outside resources

n Obtain information regarding the book of business serviced by the agency, including requested agent policies

n Review agency reports and information to help you determine the agency value

9-12 MONTHS PRIORto the effective date of the sale

Program Review

n After you have identified an agency for sale andstarted preliminary salediscussions, meet with aField Distribution Leader.You will receive an overview of the ExclusiveAgency Program and buyer requirements.

n Review the ExclusiveAgency Agreement andSupplement, ExclusiveAgency IndependentContractor Manual, andExclusive Agency ReferenceGuide

n Review the Cash Flow Models

6-9 MONTHS PRIOR to the effective date of the sale

Program Requirements

n Take the Agent SelectionProcess test

n Pass the backgroundscreening

n Complete the capitalrequirements worksheet

n Complete a business plan

n Obtain licenses and sign theLetter of Understanding forsecurities licensing

n After successfullycompleting the previoussteps, you will receivepreliminary approval to continue with the sale process

3-6 MONTHS PRIOR to the effective date of the sale

Agency Sale Process

n Negotiate and finalize the terms of the sale with the seller

n Make financingarrangements, if necessary

n Make arrangementsto lease office space, if necessary

n Make arrangements forfurniture, equipment, andsupplies, if necessary

3 MONTHS PRIOR and up to the effective date of the sale

Final Steps

n Complete the EducationProgram

n If applicable, complete the assignment ofcommissions paperwork

n Provide the region with proofof Errors and Omissionsinsurance and Workers’Compensation insurance, aswell as direct deposit form,agency desk top computersystem agreement form andany other informationrequested

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APPENDIX B

Securities offered through Allstate Financial Services, LLC (LSA Securities in LA and PA).Registered Broker-Dealer. Member NASD, SIPC. Main Office: 2920 South 84th Street, Lincoln, NE 68506. 877-525-5727.

©2005 Allstate Insurance Company. allstate.comAllstate is an Equal Opportunity Company

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