March 18, 2009

Allstate takes a hint and cuts perks

U.S. auto insurance giant Allstate Insurance Co. said it has taken the hint and canceled several perks to adapt to the recessionary business environment.

With American International Group and Merrill Lynch under the gun for handing out lucrative bonus checks while accepting federal bailuts and automakers lambasted for flying corporate jets to Washington to plead their case for emergency loans, Allstate said it had taken a hint from its customers, Crain's Chicago Business reported Wednesday.

Customers tell us they oppose recognition trips in this environment, yet they believe it is important to recognize strong performance, Chief Executive Officer Tom Wilson said in an e-mail to staff members.

In a normal year, about 10 percent of Allstate's top sales persons have been awarded free trips, Executive Director of the National Association of Professional Allstate Agents Inc. Jim Fish said.

But, Allstate is canceling the perk, most employee tickets to company sponsored events and holding company meetings locally when possible, Wilson said.

In light of the fact that the company's action was based on feedback from customers, consumers and investors, it stands to reason that these same parties would expect and applaud similar financial sacrifices from the company's management, Fish told the Chicago Tribune.