Fireman's Fund May Withdraw from Massachusetts Personal Auto

NOVATO, Calif.--July 1, 2004--The Fireman's Fund Insurance Companies has given notice to Massachusetts officials that, because of continuing uncertainty in implementing state personal automobile insurance reform, Fireman's Fund intends to withdraw from the state's personal automobile insurance market on December 31, 2004. Fireman's Fund also stated that if the insurance reform package currently under consideration is enacted by the state, Fireman's Fund will rescind its withdrawal action.

"Fireman's Fund would prefer to continue serving the personal auto insurance needs of consumers in Massachusetts," said Cynthia Tidwell, president of Personal Insurance for Fireman's Fund. "However, given the current environment, we have no choice but to issue a notice of our intent to withdraw from personal auto insurance in Massachusetts. Fireman's Fund cannot achieve necessary financial targets within the rules of the existing state personal lines auto program."

Tidwell emphasized, "We hope Massachusetts will quickly implement its reform package which is fair to both consumers and insurers. Should that occur, Fireman's Fund would rescind its notice of withdrawal."

Fireman's Fund had hoped to avoid filing notice of withdrawal from the state's personal automobile market, but realized that reform measures approved this week by the Commonwealth Automobile Reinsurers have not yet been enacted, and, even if enacted, may face additional challenges. Fireman's Fund could not wait any longer to make a decision because of regulatory deadlines affecting when notice of withdrawal must be given.

As a result, Fireman's Fund yesterday provided to officials its official notice of intention to withdraw from personal automobile as of December 31, 2004, because all insurers are required by law to file paperwork six months in advance of actual withdrawal.

Fireman's Fund currently offers personal automobile insurance coverage to approximately 22,000 customers in Massachusetts, representing less than one percent of the state's auto market. The withdrawal from personal automobile insurance will not affect any other lines of commercial or personal lines coverage offered by Fireman's Fund in Massachusetts.

Fireman's Fund Insurance Companies is a premier property and casualty insurance company providing personal, commercial, marine, excess and surplus lines and agribusiness insurance products nationwide. Fireman's Fund is a member of the Allianz Group, one of the world's largest providers of property and casualty insurance and other financial services.