Executive Compensation Tables

SUMMARY COMPENSATION TABLE

The following table summarizes the compensation of the named executives for the last three fiscal years. However, only the last fiscal year is shown for Ms. Fortin since this is the first year she is a named executive.

Name and Principal Position   Year   Salary
($)
  Bonus
($)
  Stock
Awards
($)(1)
  Option
Awards
($)(2)
  Non-Equity
Incentive
Plan
Compensation
($)
  Change in
Pension Value
and
Non-qualified
Deferred
Compensation
Earnings
($)(3)
  All
Other
Compensation
($)(4)
  Total
($)
  Total
Without
Change in
Pension
Value
($)(5)
Thomas J. Wilson
Chair and Chief
Executive Officer
  2016   1,200,000     5,400,028   3,600,000   1,982,880   1,574,760   55,847   13,813,515   12,238,755
  2015   1,191,346     4,599,968   4,599,996   2,888,136   532,116   62,131   13,873,693   13,341,577
  2014   1,141,346     3,849,997   3,850,001   4,073,075   2,632,215   94,751   15,641,385   13,009,170
Steven E. Shebik
Executive Vice
President and Chief
Financial Officer
  2016   770,673     1,649,984   1,100,001   600,000   479,800   28,690   4,629,148   4,149,348
  2015   750,000     1,124,996   1,124,999   850,000   185,312   28,180   4,063,487   3,878,175
  2014   652,500     900,001   899,998   883,619   827,696   26,960   4,190,774   3,363,078
Don Civgin
President, Emerging
Businesses
  2016   776,885     1,440,028   959,999   535,066   88,721   38,727   3,839,426   3,750,705
  2015   760,808     1,193,019   1,192,993   768,629   46,822   37,195   3,999,466   3,952,644
  2014   700,000     1,050,018   1,049,996   1,000,000   135,885   26,560   3,962,459   3,826,574
Mary Jane Fortin
President, Allstate
Financial
  2016   632,752     937,480   625,006   291,774   27,366   30,682   2,545,060   2,517,694
Matthew E. Winter
President
  2016   820,673     1,920,017   1,279,999   1,017,513   121,710   153,663   5,313,575   5,191,865
  2015   799,423     1,550,034   1,550,004   1,600,000   80,745   79,399   5,659,605   5,578,860
  2014   766,539     1,312,484   1,312,504   1,500,000   139,076   39,016   5,069,619   4,930,543
(1) The aggregate grant date fair value of PSAs granted in 2016, 2015, and 2014 are computed in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 718 (ASC 718). The fair value of PSAs is based on the final closing price of Allstate’s common stock on the grant date, which in part reflects the payment of expected future dividends. (See note 18 to our audited financial statements for 2016.) This amount reflects an accounting expense and does not correspond to actual value that will be realized by the named executives. The value of PSAs is based on the probable satisfaction of the performance conditions. The number of PSAs granted in 2016 to each named executive is provided in the Grants of Plan-Based Awards table on page 52. The value of the PSAs granted in 2016 at grant date share price if maximum corporate performance were to be achieved is as follows: Mr. Wilson $10,800,056, Mr. Shebik $3,299,969, Mr. Civgin $2,880,056, Ms. Fortin $1,874,960, and Mr. Winter $3,840,034.
(2)

The aggregate grant date fair value of option awards is computed in accordance with FASB ASC 718. The fair value of each option award is estimated on the grant date using a binomial lattice model and the assumptions (see note 18 to our audited financial statements for 2016) as set forth in the following table:

    2016   2015   2014
Weighted average expected term   5.0 years   6.5 years   6.5 years
Expected volatility   16.0-34.3%   16.0-37.8%   16.8-42.2%
Weighted average volatility   24.3%   24.7%   28.3%
Expected dividends   1.9-2.1%   1.6-2.1%   1.7-2.2%
Weighted average expected dividends   2.1%   1.7%   2.1%
Risk-free rate   0.2-2.4%   0.0-2.4%   0.0-3.0%

This amount reflects an accounting expense and does not correspond to actual value that will be realized by the named executives. The number of options granted in 2016 to each named executive is provided in the Grants of Plan-Based Awards table on page 52.

(3) Amounts reflect the aggregate increase in actuarial value of the pension benefits as set forth in the Pension Benefits table, accrued during 2016, 2015, and 2014. These are benefits under the Allstate Retirement Plan (ARP) and the Supplemental Retirement Income Plan (SRIP). Non-qualified deferred compensation earnings are not reflected since our Deferred Compensation Plan does not provide above-market earnings. The pension plan measurement date is December 31. (See note 17 to our audited financial statements for 2016.)

The following table reflects the respective change in the actuarial value of the benefits provided to the named executives in 2016:

Name   ARP
($)
  SRIP
($)
Mr. Wilson   113,353   1,461,407
Mr. Shebik   124,367   355,433
Mr. Civgin   14,350   74,371
Ms. Fortin   7,861   19,505
Mr. Winter   12,991   108,719

Interest rates and other assumptions can have a significant impact on the change in pension value from one year to another.

Effective January 1, 2014, Allstate modified its pension plans so that all eligible employees earn future pension benefits under a new cash balance formula. The change in actuarial value of benefits provided for each named executive in 2016 would have been as indicated in the following table under the prior formula:

Name   ARP
($)
  SRIP
($)
Mr. Wilson   184,530   5,297,617
Mr. Shebik   203,850   2,426,861
Mr. Civgin   12,341   88,922
Ms. Fortin   6,979   1,368
Mr. Winter   10,271   86,457
(4)

The following table describes the incremental cost of other benefits provided in 2016 that are included in the “All Other Compensation” column.

Name   Personal
Use of
Aircraft(1)
($)
  401(k)
Match(2)
($)
  Other(3)
($)
  Total
All Other
Compensation
($)
Mr. Wilson   16,837   10,600   28,410   55,847
Mr. Shebik     10,600   18,090   28,690
Mr. Civgin     10,600   28,127   38,727
Ms. Fortin     10,412   20,270   30,682
Mr. Winter   121,998   10,600   21,065   153,663
(1) The amount reported for personal use of aircraft is based on the incremental cost method, which is calculated based on Allstate’s average variable costs per flight hour. Variable costs include fuel, maintenance, on-board catering, landing/ramp fees, and other miscellaneous variable costs. The total annual variable costs are divided by the annual number of flight hours flown by the aircraft to derive an average variable cost per flight hour. This average variable cost per flight hour is then multiplied by the flight hours flown for personal use to derive the incremental cost. This method of calculating the incremental cost excludes fixed costs that do not change based on usage, such as pilots’ and other employees’ salaries, costs incurred in purchasing the aircraft, and non-trip related hangar expenses.
(2) Each of the named executives participated in our 401(k) plan during 2016. The amount shown is the amount allocated to their accounts as employer matching contributions. Ms. Fortin will not be vested in the employer matching contribution until she has completed three years of vesting service.
(3) “Other” consists of personal benefits and perquisites related to mobile devices, tax preparation services, financial planning, ground transportation, executive physical related items and supplemental long-term disability coverage. There was no incremental cost for the use of mobile devices. We provide supplemental long-term disability coverage to all regular full- and part-time employees who participate in the long-term disability plan and whose annual earnings exceed the level which produces the maximum monthly benefit provided by the long-term disability plan. This coverage is self-insured (funded and paid for by Allstate when obligations are incurred). No obligations for the named executives were incurred in 2016, and therefore, no incremental cost is reflected in the table. Mr. Civgin was also provided limited home security protection during the year.
(5) We have included an additional column to show total compensation minus the change in pension value. The amounts reported in this column may differ substantially from, and are not a substitute for, the amounts reported in the “Total” column required under SEC rules. The change in pension value is subject to several external variables, including interest rates, that are not related to company or individual performance and may differ significantly based on the formula under which the benefits were earned.