Utica National had good sales growth in the first quarter and added to its Policyholders’ Security Fund but, like the rest of the property-casualty insurance industry, severe winter weather contributed to an increase in the company’s loss ratio.
“Sales were a great story for us, with direct written premium coming in $13.2 million or 7.8 percent over quota,” said J. Douglas Robinson, Chairman of the Board and Chief Executive Officer, following the quarterly meeting of Utica National’s member companies’ Boards of Directors, held May 12 at the home office in New Hartford, NY.
“We had excellent new business growth and beat our retention targets in both personal and commercial lines,” said Mr. Robinson. The company wrote $183.6 million in direct written premium in the first quarter.
However, claim activity from severe weather helped push Utica’s incurred losses $11 million over target. Utica’s combined loss and expense ratio was 2.2 points above plan due to the winter storms. Loss ratios for Utica’s Agents’ Errors and Omissions and General Liability lines both came in under plan, but most other lines of business saw increases, including Workers Compensation and Commercial Multi-Peril, and in Personal Lines, Auto and Homeowners.
Utica had a loss of $29 million in the underwriting of insurance, $9.0 million over plan. Mostly offsetting that was other income of $25.7 million, which was $2.1 million ahead of plan, mainly investment income and realized capital gains. Federal taxes were under plan by $3.2 million, and Utica had positive adjustments to its Policyholders’ Security Fund of $4 million, mostly appreciation of some investments. That helped increase the Fund by $3.4 million, bringing it to $819.4 million, which was $600,000 behind plan.
Mr. Robinson said that the company continued to work to improve efficiency, delivering more technology upgrades in the first quarter: “In Personal Lines, we enhanced our Express Rate system to issue Auto policies in real time in the agent’s office. We’re also introducing new mobile ‘smartphone’ options for policyholders’ use via our Customer Care Center.”
In Commercial Lines, the company launched a new Workers Compensation Policy Administration system, along with “bridging,” which allows real time processing from an agent’s management system for Business Owners, Workers Compensation, and Commercial Auto insurance. “We’ve also gotten a great reception to the Workers’ Compensation claim information that’s now available to policyholders at the click of a button, giving them the capability through our Customer Care Center to report claims on-line and also to view the Cost Containment savings we’ve achieved on their behalf through medical bill review,” said Mr. Robinson.