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Allstate Unit To Sell FA-Backed Notes To Individuals

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NU Online News Service, April 28, 2004, 2:33 p.m. EDT – A unit of The Allstate Corp., Northbrook, Ill., will be selling up to $4 billion in notes backed by Allstate funding agreements to individuals as well as to institutions.[@@]

Allstate has sold about $8.5 billion in notes backed by Allstate funding agreements to institutional investors since 1999, but the new notes are the first of their kind that will be available to individuals, Allstate says.

A funding agreement is a contract that calls for an insurer to pay investors a specified fixed or floating rate of return.

Investors think of funding agreements and notes backed by funding agreements as stable-value investments that offer a relatively high rate of return, according to a report on the subject from Moody’s Investors Service, New York.

Allstate is issuing the funding agreements through Allstate Life Insurance Company and the notes through Allstate Life Global Funding trust.