Underwriting loss $939 million, net income $3.6 billion at State Farm property & casualty firms
February 27, 2015 by Canadian Underwriter
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State Farm reported Friday its property & casualty companies had an underwriting loss of $939 million in 2014 compared to an underwriting gain of $230 million in 2013, with net income of $3.6 billion in 2014. All figures are in U.S. dollars.
Bloomington, Ill.-based State Farm released financial results on its 12 companies, nine of which provide p&c insurance.
In Canada, State Farm insurance is currenlty written by Certas Home and Auto Insurance Company and owned by Desjardins Group of Levis, Quebec. The 2014 results include State Farm Canada’s operations.
State Farm reported total revenue of $71.2 billion in 2014, up from $68.3 billion in 2013. That includes premium revenue, earned investment income and realized capital gains or losses.
Net income in 2013, for p&c, was $4.2 billion.
In 2014, State Farm had earned premiums, in p&c, of $56.9 billion, up from $54.5 billion the previous year.
State Farm’s p&c insurers are “primarily engaged in” auto, health, homeowners, commercial multiple peril (CMP) and reinsurance.
In the category of homeowners, CMP and other, State Farm said its earned premiums were $19.8 billion in 2014, up 4.2% from $19 billion in 2013. The underwriting gain was $1.9 billion, down from $2.1 billion in 2013.
In auto, earned premiums were $35.3 billion, up 5.6% from $33.4 billion in 2013. The underwriting loss in auto was $3.4 billion in 2014, compared to an underwriting loss of $2.4 billion in 2013.
In p&c, State Farm’s investment and other income was $4.3 billion in 2014, up from $4.1 billion in 2013.
State Farm’s p&c companies are State Farm Mutual Automobile Insurance Company, State Farm Indemnity Company, State Farm Guaranty Insurance Company, State Farm County Mutual Insurance Company of Texas, Oglesby Reinsurance Company, State Farm Fire and Casualty Company, State Farm Lloyds, State Farm General Insurance Company and State Farm Florida Insurance Company.
Desjardins closed Jan. 1 the acquisition of State Farm’s Aurora, Ont.-based Canadian operations – including p&c, life insurance, mutual fund, loan and living benefits operations.
Desjardins continues to use the State Farm brand in Ontario, Alberta and New Brunswick. As part of the acquisition, State Farm agreed to invest $450 million in non-voting preferred shares into Desjardins Group’s post-closing p&c insurance business. French financial services provider Credit Mutuel also agreed to invest $200 million in Desjardins.
The Desjardins p&c group also includes Desjardins General Insurance Group Inc., whose products include home and auto in Ontario, Alberta and Quebec, as well as commercial auto, property, liability and equipment breakdown in Quebec. Desjardins Group also owns High River, Alta.-based Western Financial Group Inc., which in turn owns more than160 brokerages in Western Canada, plus Western Direct Insurance and Marlin Travel, among others.
CORRECTION NOTICE: An earlier version of this story incorrectly stated the State Farm p&c results do not include the Canadian results and that the total revenue was for p&c. In fact, Desjardins Group’s acquisition of State Farm Canada did not take effect until Jan. 1, 2015 and total revenue includes non-insurance and life insurance.
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I have a question for the Homeowners underwriting Mgr. I have 3 cars and 2 homes insured with Certas (formerly State Farm) I also have a condo in Florida. My question is this. I was always under the impression that 10% of my contents coverage transferred to my condo in Florida. Is this still the case. I also have a PLUP. Does the liability from the Ho or the Plup extend to my condo?