Mercury Insurance and Tokio Marine America Partner to Help Thousands of Californians Facing Non-renewals

Rhea-AI Summary

Mercury Insurance and Tokio Marine America have collaborated on a plan to assist thousands of California consumers facing non-renewals. Tokio Marine America is transitioning out of the California personal lines market, and Mercury Insurance is stepping in to support agents and customers during this period. A diverse group of entities, including California independent insurance agents and the California Department of Insurance, have worked together on this project to provide coverage for affected consumers. The plan involves transitioning customers of Tokio Marine America and its subsidiary, Trans Pacific Insurance Company, to Mercury Insurance.

Positive

• Mercury Insurance is spearheading a plan to maintain insurance availability and provide coverage for California consumers facing non-renewals due to Tokio Marine America's exit from the personal lines market.

• A group of California independent insurance agents, along with the California Department of Insurance, are collaborating to assist in the transition of customers from Tokio Marine America to Mercury Insurance.

• Mercury Insurance's commitment to supporting independent agents and California consumers during this transition period demonstrates its dedication to providing ongoing coverage and stability in the market.

Negative

• Tokio Marine America's decision to exit the California personal lines market due to the small segment of personal lines business and the cost of updating its information technology systems may have a negative impact on affected customers and agents.

• The exit of Tokio Marine America and its subsidiary, Trans Pacific Insurance Company, from the personal lines market could disrupt the insurance landscape for consumers in California.

Mercury to Support Agents and Customers as Tokio Marine America Transitions Out of the California Personal Lines Market

LOS ANGELES, May 9, 2024 /PRNewswire/ -- Mercury Insurance (NYSE: MCY) is spearheading a plan to maintain insurance availability and provide coverage for thousands of California consumers. Tokio Marine America (TMA) and Mercury have closely cooperated to develop a plan to transition customers of TMA and its subsidiary, Trans Pacific Insurance Company (TPIC), to Mercury with assistance from a group of California independent insurance agents, and leadership from the California Department of Insurance.

"Innovative solutions surface during challenging times," said Gabriel Tirador, Chief Executive Officer and Director of Mercury. "A diverse group of entities worked together on this project with the common goal of providing coverage for California insurance consumers."

Tokio Marine America offers personal lines insurance only in California, representing a small percentage of the California personal lines market. Given the small segment of personal lines business and cost of updating its information technology systems, the company announced in April 2023 that it cannot sustainably support personal lines coverages and would be exiting the personal lines market. The Department of Insurance reviewed the proposal to transition customers to Mercury after Tokio Marine announced its withdrawal from personal lines.

TMA's and TPIC's exit has no impact on any other Tokio Marine Group company, and the company will continue writing commercial coverage for California businesses.

"We are pleased to have reached an agreement with Mercury Insurance Group to support our personal lines agents and customers during this transition period," said Daisuke Ugaeri, Chief Executive Officer at Tokio Marine America. "Tokio Marine America remains committed to commercial lines in California — and across the country — and supporting our agents and customers with exceptional service through this transition."

When TMA decided to exit its personal lines business in California, they immediately began exploring options to help affected customers and agents. The details of the plan came together over the past several months during a time when a number of insurance companies were either exiting the California market or pausing new business applications. Mercury never shut down new business, however, becoming one of the few companies that continued to support independent agents and California consumers.

"Tokio Marine America customers are similar to ours in terms of their coverage needs and their insurance agent relationships," said Brandt Minnich, Mercury's Vice President and Chief Sales Development Officer. "Starting in January 2024, we began working with TMA to bring together a cohesive group of independent agents who could facilitate the transfer of their policies to Mercury for those customers who were interested, ensuring continuing coverage."

The agent solution involved partnering with a team of existing Mercury independent agents who also represented TMA, as well as more than a dozen TMA agents who have been offered Mercury agent appointments to help facilitate the transition. 

Mercury's interest in the transition was based on more than just a new business opportunity. "We believe very strongly in California's future," said Tirador. "The steps Commissioner Lara and the California Department of Insurance are taking to modernize the insurance market through the Commissioner's "Sustainable Insurance Strategy" will help stabilize the market and create a transparent, sustainable model that will benefit California consumers."

About Tokio Marine America 

Tokio Marine America (TMA) is the marketing name for Tokio Marine America Insurance Company (TMAIC), Trans Pacific Insurance Company (TPI), and TNUS Insurance Company (TNUS). For over 100 years, TMA has offered comprehensive commercial property and casualty insurance products to some of the world's largest and most distinguished organizations in a variety of industries in all 50 U.S. states, Puerto Rico, and the District of Columbia. With the highest financial strength rating `A++' (Superior) by A.M. Best Company and `A+' rating for counterparty credit and financial strength by Standard & Poor's, TMA provides unique insurance and risk management tools from experienced staff, and fair and timely claim settlements from a skilled team of claim professionals. For more information, please visit http://www.tmamerica.com

About Mercury Insurance

Mercury Insurance (NYSE: MCY) is a multiple-line insurance carrier offering personal auto, homeowners, and renters insurance directly to consumers and through a network of independent agents in Arizona, California, Georgia, Illinois, Nevada, New Jersey, New York, Oklahoma, Texas and Virginia, as well as auto insurance in Florida. Mercury also writes business owners, business auto, landlord, commercial multi-peril and mechanical protection insurance in various states.

Since 1962, Mercury has provided customers with tremendous value for their insurance dollar by pairing ultra-competitive rates with excellent customer service. Mercury has earned "A" ratings from A.M. Best and Fitch, as well as "Best Auto Insurance Company" designations from Forbes and Insure.com. For more information visit www.MercuryInsurance.com or follow the company on Twitter or Facebook.

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SOURCE Mercury Insurance

FAQ

What is the partnership between Mercury Insurance and Tokio Marine America about?

Mercury Insurance and Tokio Marine America have collaborated on a plan to assist thousands of California consumers facing non-renewals as Tokio Marine America transitions out of the California personal lines market.

What led to Tokio Marine America's decision to exit the personal lines market in California?

Tokio Marine America decided to exit the California personal lines market due to the small segment of personal lines business and the cost of updating its information technology systems.

How are California independent insurance agents involved in the transition?

California independent insurance agents, along with the California Department of Insurance, are collaborating to assist in the transition of customers from Tokio Marine America to Mercury Insurance.

What steps has Mercury Insurance taken to support affected customers and agents?

Mercury Insurance has worked with a group of California independent insurance agents to facilitate the transfer of policies from Tokio Marine America to ensure continuing coverage for affected customers.

What is the impact of Tokio Marine America's exit on the insurance market in California?

Tokio Marine America's exit from the California personal lines market could disrupt the insurance landscape for consumers in California.

How does Mercury Insurance plan to stabilize the insurance market in California?

Mercury Insurance believes in California's future and supports the modernization of the insurance market through the California Department of Insurance's 'Sustainable Insurance Strategy' to benefit California consumers.