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Mercury General Corporation Message Board

  • passinthru58 passinthru58 Apr 20, 2002 11:46 AM Flag

    Mercury's Upcoming Test

    The California auto insurance market is falling apart, leaving a smaller voluntary market to handle the business. While this creates opportunities for companies like Mercury, it only does so if the company is positioned to profitably handle the growth. Were the 6.9% rate increases enough? Was the company too cautious with respect to CIC 1861.05(c)(3) in making the 6.9% filings? Can the large increase in new business be profitably absorbed in the current book? What are the growth plans for the Claims organization? The answers to most of these questions appear to lie ahead. Look forward to seeing how things play out. Assuming they play out well, crossing the $2B mark in writings should happen in the next few years.

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    • what do you mean the market is falling apart? since i dont live in california i really dont know how bad it is. could you give examples? by the way in the annual report gj says they have spent the last two years working on infrastructure issues. hopefully it will work like a couple of years ago when they were fully prepared to grow quickly.

      • 1 Reply to jhines0117
      • The California market, in particular the non-standard part of it, has lost a large number of programs in the last year. Allstate P&C has a 20+% rate increase pending approval. Reinsurers, who've played a big part since Prop 103, have pulled back. A number of companies have been seized. John Garamendi appears to be the next insurance commissioner. Rate increase approvals are backlogged at the Department of Insurance. A class action suit involving carriers and their handling of annual mileage in the rating of policies is underway. Finally, State Farm, who posted a 125 COR last year, has increased rates for the first time since 1989.

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