Posted On: March 7, 2005, 6:42 pm CST

Posted By: J. Jones

Mr. Buffett is giddy about NJ for auto insurance? I can not wait for three years from now when the losses hit and Geico NJ is in the red. National auto insurance companies have NO IDEA what they are in for in NJ. There are already bills before the legislature to abolish credit scoring which is what prompted Geico and Mercury Insurance and now Progressive to enter the NJ market for auto insurance. Once credit scoring is gone, these national companies will flee as fast as they entered the market. Mr. Buffett is dead wrong on this one. The political environment in NJ is too corrupt and fickle. The rules a company operates under now for insurance can change in an instant. The regional auto insurance companies know this and have set up their rate structures to reflect this. So... when credit scoring goes away in NJ, like it will, Geico will flee once again because they will be flowing in red ink because of the high Personal Injury Protection claims. Remember, each driver on a policy is covered up to $250,000 for medical bills per incident. No more help from the Dept of Insurance to help cover the loss in the PIP part of the claims. The companies are on the hook for ALL OF IT!

Good luck Warren, you will need it. Just get the names of the people in your organization who recommended re-entering NJ and get ready to hang them!