ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Friday, September 13, 1996 TAG: 9609130129
SECTION: BUSINESS PAGE: A-9 EDITION: METRO
SOURCE: MAG POFF STAFF WRITER
STATE FARM, which writes nearly a fifth of the auto policies in Virginia, will raise premiums 3.1 percent.
Virginia's largest automobile insurer will boost its overall premium prices in the state an average of 3.1 percent.
State Farm Mutual Automobile Insurance Co., which writes nearly a fifth of automobile insurance policies sold in Virginia, will raise its rates Oct. 1.
Of the other nine largest automobile insurers selling coverage to Virginia motorists, five have increased premiums within the past year, according to filings with the State Corporation Commission. The other four announced decreases.
State Farm said most of its increase will come in collision coverage, with lesser average increases in the portion of policies that pays for injury to people: bodily injury and property damage liability, and medical payments.
The increases are caused by rising claim costs in Virginia, according to State Farm spokeswoman Mary Beth Cramer.
The overall changes in premiums for individual motorists will vary, she said. Actual costs depend on the specific types of coverage that each customer decides to carry, where in the state they live and drive, the kind of car that's insured, who drives it and how much it is driven.
State Farm's most recent general auto insurance rate change in Virginia was a 3.8 percent average increase, effective Nov. 1, 1994.
The company said it is adding a 20 percent accident-free discount for customers whose cars have been insured with State Farm and who have remained accident-free for at least 10 years.
The new discount is in addition to the company's previous discounts of 10 percent for customers who are accident-free for three years and of 15 percent for people who are accident-free for six years.
The largest decrease - 11.2 percent - in Virginia auto premiums in the last year was by Virginia Farm Bureau Mutual Insurance Co. of Richmond, the eighth-ranked company in that business.
Spokesman Charles Clement described Virginia Farm Bureau as "more of a niche player," compared with more widely distributed coverage by State Farm. Virginia Farm Bureau concentrates on selling coverage to farmers and rural families.
The company, which has 2.7 percent of the state's automobile insurance market, also underwrites or selects its policyholders very carefully, Clement said. Therefore, it has a very good history when it comes to losses, he said.
One of the main reasons for the drop in premiums, Clement said, was recent adoption of a program that grants discounts for families buying multiple policies. If a family has auto insurance, for instance, and then buys homeowner insurance with Virginia Farm Bureau, both policies will carry a discount in premiums.
Clement said his company's automobile insurance premiums are evaluated each year in light of its losses. He said premiums could go up next year because hail storms skewed losses by damaging a lot of cars this year.
LENGTH: Medium: 67 lines ILLUSTRATION: PHOTO: PHILIP HOLMAN Staff Still more reason to driveby CNBcarefully: Repairing cars, like these seen on Interstate 581, isn't
cheap. State Farm Mutual Automobile Insurance Co. said most of its
increase will come in collision coverage, with lesser average
premium increases in bodily injury, property liability, and medical
coverage. The increases are caused by rising claim costs in
Virginia. color. Graphic: Chart: Auto Insurance. color. KEYWORDS: MGR