- 783
So if the Carrier doesnt't get their rate increase, just term the agency with over 70% LR. Just not right! Rather than non renew the policy holder, Safeco will just non renew the Agent.
My question: with these Agency terminations: will all their policy's be non renewed as a result? I believe that is a state by state rule, but not familiar with CA. Maybe @shawnmwalker can chime in.....
December 12, 2023
Liberty Mutual’s Safeco unit has moved forward with a plan to trim half of the organization’s agents in California after state regulators apparently did not sign off on requested rate hikes, Insurance Insider U.S. reported Tuesday.
The agents impacted by the reorganization had five-year loss ratios that exceeded 70%, the publication wrote. Further, other agents will be placed by Safeco on “performance improvement plans, effective January 1,” Insurance Insider US noted.
When asked about the changes by P&C Specialist, a spokesperson for Boston-based Liberty Mutual said via email that the firm would not provide details about reported Safeco restructuring on the West Coast.
“We don’t comment on the specifics of our business plan but we are committed to California and Safeco remains open for new business in California,” the spokesperson noted.
Staffing shakeups have been a key theme this year at Liberty Mutual. Like all its big peers, the No. 6 personal lines carrier has been affected by 41-year-high inflation, rising incident severity, growing catastrophic losses, mounting reinsurance costs and regulatory pushback to rate hikes in states like California.
Earlier this year, the company parted ways with 1,220 employees or almost 3% of its workforce. The layoffs were a part of the insurer’s multiyear transformation plan that covers its U.S. retail markets, global risk solutions businesses, tech and other corporate groups. The corporate revisions also are transpiring as a new CEO, Tim Sweeney, implements his vision for the company following the exit of long-time chief executive David Long from the role. Long is now executive chair.
The reported Safeco agent trimming is not the first time that Liberty Mutual has seemingly taken actions to remedy the firm’s bottom line in California this year.
In late July, Reuters reported that the Fortune 100 company planned to “stop offering its business owner’s policy (BOP) product” starting in October and “will not renew its current book of this line of business beginning in December,” Reuters wrote, citing a company spokesperson. The news service describes BOP as “an insurance product usually required by business owners that bundles all major property and liability risks into a single package.”
BOP is a small part of the company’s writings in California, according to Insurance Insider US.
That news was followed by August filings with the California Department of Insurance that revealed Safeco planned to drop over 950 policies in the Bay Area, impacting approximately 1% of the carrier’s California homeowners’ business.
Throughout the first half of the year, five major carriers — Progressive, State Farm, Allstate, Nationwide and Farmers — announced significant exposure reduction plans for homeowners business in California. Those five carriers account for 45% of the market share for the state.
And in July, Tokio Marine America said it would suspend underwriting new personal lines business — except for personal auto insurance — in the California admitted market as of July 15, with plans to exit all of the state’s admitted personal lines market by June 1, 2026.
source:
https://www.pandcspecialist.com/c/4...OdmJTd2dNVFV4TnpZNE16UXNJRFkzT0Rjd056UXhNdz09
My question: with these Agency terminations: will all their policy's be non renewed as a result? I believe that is a state by state rule, but not familiar with CA. Maybe @shawnmwalker can chime in.....
December 12, 2023
Liberty Mutual’s Safeco unit has moved forward with a plan to trim half of the organization’s agents in California after state regulators apparently did not sign off on requested rate hikes, Insurance Insider U.S. reported Tuesday.
The agents impacted by the reorganization had five-year loss ratios that exceeded 70%, the publication wrote. Further, other agents will be placed by Safeco on “performance improvement plans, effective January 1,” Insurance Insider US noted.
When asked about the changes by P&C Specialist, a spokesperson for Boston-based Liberty Mutual said via email that the firm would not provide details about reported Safeco restructuring on the West Coast.
“We don’t comment on the specifics of our business plan but we are committed to California and Safeco remains open for new business in California,” the spokesperson noted.
Staffing shakeups have been a key theme this year at Liberty Mutual. Like all its big peers, the No. 6 personal lines carrier has been affected by 41-year-high inflation, rising incident severity, growing catastrophic losses, mounting reinsurance costs and regulatory pushback to rate hikes in states like California.
Earlier this year, the company parted ways with 1,220 employees or almost 3% of its workforce. The layoffs were a part of the insurer’s multiyear transformation plan that covers its U.S. retail markets, global risk solutions businesses, tech and other corporate groups. The corporate revisions also are transpiring as a new CEO, Tim Sweeney, implements his vision for the company following the exit of long-time chief executive David Long from the role. Long is now executive chair.
The reported Safeco agent trimming is not the first time that Liberty Mutual has seemingly taken actions to remedy the firm’s bottom line in California this year.
In late July, Reuters reported that the Fortune 100 company planned to “stop offering its business owner’s policy (BOP) product” starting in October and “will not renew its current book of this line of business beginning in December,” Reuters wrote, citing a company spokesperson. The news service describes BOP as “an insurance product usually required by business owners that bundles all major property and liability risks into a single package.”
BOP is a small part of the company’s writings in California, according to Insurance Insider US.
That news was followed by August filings with the California Department of Insurance that revealed Safeco planned to drop over 950 policies in the Bay Area, impacting approximately 1% of the carrier’s California homeowners’ business.
Throughout the first half of the year, five major carriers — Progressive, State Farm, Allstate, Nationwide and Farmers — announced significant exposure reduction plans for homeowners business in California. Those five carriers account for 45% of the market share for the state.
And in July, Tokio Marine America said it would suspend underwriting new personal lines business — except for personal auto insurance — in the California admitted market as of July 15, with plans to exit all of the state’s admitted personal lines market by June 1, 2026.
source:
https://www.pandcspecialist.com/c/4...OdmJTd2dNVFV4TnpZNE16UXNJRFkzT0Rjd056UXhNdz09
