Travelers’ CEO Fishman: Rate Increases Continuing

September 11, 2012

  • September 11, 2012 at 1:39 pm
    Jay says:
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    IN an era of Stagflation he just keeps taking it to the bank.

    • September 11, 2012 at 2:13 pm
      John Q Agent says:
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      Jay may be taking it to the bank but Travelers agents and customers are taking it somewhere else. We are seeing up 50% increases.

  • September 11, 2012 at 1:55 pm
    CT PL Agent says:
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    Traveler’s WAS my go to company for my personal lines accounts…not any more. They are pricing themselves right out of the market. I try to move as much Traveler’s business as I can! It’s that, or my client’s are going to move themselves right out of my agency. It isn’t hard to beat Traveler’s premiums anymore and not long ago, they were unbeatable!

    • September 11, 2012 at 3:00 pm
      Agent says:
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      Traverlers was my #1 Personal Lines market for several years. When they started the rate taking game the past 3 years, they have now slipped to #2 and continue to decline. It is really a shame and we have to move accounts or lose them. My marketing rep gives us the line that they are positioning themselves to grow in 2013. Reading between the lines, they expect the other carriers to catch up to them on rates and they will look better. The other carriers have taken some rate, but they continue to be much lower than Travelers. They are a great brand, but we can’t sell the brand now in this economy.

      • September 11, 2012 at 4:33 pm
        Agent says:
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        Travelers is not known for being agent friendly in the past several years. The way they pay commissions piece meal if the account is on Direct Bill or EFT is a joke. All our other carriers pay the full commission on renewals. Their management also doesn’t listen to the agents well. When they had their first round of rate taking, we met with two of their managers and showed them actual quotes against other carriers. They couldn’t believe their eyes and said they would look into it and see what could be done to get more competitive. Two months later, we had another rate increase. So much for looking into it.

  • September 11, 2012 at 2:55 pm
    sandman says:
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    I agree with CT agent. I have Travelers and many more. Travelers is the best about 1% if the time. Mngmnt needs to wake up.

  • September 11, 2012 at 4:05 pm
    Jon says:
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    I’m currently a Travelers home-owners insured.

    When I had a claim, they were great.

    Until the premium went through the roof.

    Now I need to wait ’til the damned thing falls off and I’ll be switching asap. Pricing themselves out of the market for sure!

    • September 11, 2012 at 4:08 pm
      CT PL Agent says:
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      Jon–you should still shop around even though you have a claim on your CLUE. Travelers premiums have gotten so far out of whack that I’m finding that I can move a client to a different company even with a claim (not an open claim, though)…just as long as you don’t have two claims in the same year, you should be pretty good to quote…

      • September 11, 2012 at 4:23 pm
        Jon says:
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        I’ll check into it–thanks!

  • September 11, 2012 at 4:20 pm
    Struvester says:
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    Most carriers are unprofitable in personal lines. Carriers who lead the way to sustainable pricing are often blamed, but unless the competition has magic formula – they will follow suit to stay in business. I’d rather see 7% increases in two years, than 15 or 20% at once.
    Remember: Smart agents sell more than PRICE!

    • September 12, 2012 at 2:06 pm
      Travelers Smavelers says:
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      They raised more than 7% in the personal lines arena Struvester! In the states that I write, the increases are in the 19% range. The most unbelievable rate increases I have seen in a long time. The worst part in my dealings with them is that they begged to take over HUGE books of business, we agreed and then they turn around and do this. I AM NOT an agent that just sells price, but when I have markets that offer coverage’s that are just as comprehensive as the Travelers, I will move them all day to save the business. I will say that agents must be aware of the type of package the insured has with Travelers as to make sure you are offering comparable coverage’s. I recently convinced a Travelers HV home policy holder to remain where they are even with the higher premium b/c the others could not offer what the high value home policy that Traveler’s did. But in more cases than not, we can move them to much lower premium without sacrificing coverage. Have a great day all!

      • September 12, 2012 at 5:19 pm
        Agent says:
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        Many years ago, we had one of those offers of doing book rollovers to increase the book and make contingency easier to make. Some agents fell for it and suffered the consequences when the carrier started acting like Travelers is right now. We have 4 other Personal Lines markets and it is relatively easy to move business when we have to. It is somewhat difficult to stay up with all the changes carriers are making, but it really helps to have a comparative rater so the CSR’s can get a picture real quick of what market to use. I lean to helping the customer more often than helping the company. The customer is not always right, but they are the customer and they pay the freight by their premium dollars.

  • September 11, 2012 at 5:00 pm
    Teri j says:
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    Don’t you want carriers to return to profitable levels so that in return agency profits increase? Folks wait for Hail or wind/thunderstorms to get a new roof in lieu of budgeting for one and then complain when rates go up.

  • September 12, 2012 at 9:15 am
    aVoiceOfReason says:
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    Any agent surprised by Travelers soft market aggressiveness and hard market swing should be ashamed of themselves. The large stock companies do this repeatedly. CNA, Encompass, Hartford, Travelers, etc. And like the eager dog who chases his owner’s fake throw, agents keep going back to them. Wise up, find a few regional carriers who actually understand customer service, and enjoy the business of insurance. You should be a consultant to your customers and not a marketer of cheapest price. If you only win a customer based on price, you’ll lose that customer based on price. Provide them a value.

    • September 12, 2012 at 2:08 pm
      CT PL Agent says:
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      That’s all fine and good, Voice, but when you have clients who are struggling to pay their mortgage, utilities, buy food, pay for insurance, it’s kind of difficult to sell the more expensive policy. I write the best coverage that I possibly can for my clients…higher deductibles, etc., but that still isn’t enough a lot of times. I don’t sell on price, but in this economy, that isn’t always possible to do.

      • September 12, 2012 at 2:29 pm
        Agent says:
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        We sometimes lose out to one of the captives like Farmer’s, Allstate or State Farm because they are selling improper values, lower limits etc to get to a bottom line on the cost. People are hurting in this economy and insurance is one thing they seem to take a chance on and just take the least expensive route and hope for the best. I refuse to sell minimum limits on Auto and try my darndest to sell proper valuation on Homes, but sometimes it just doesn’t work out. I do feel better about my E&O though and these other dudes selling poor coverage will suffer the consequences if there is a claim.

        • September 13, 2012 at 5:01 pm
          Dean Hansen says:
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          At our Farmers Insurance agency we do not write minimum auto limits. We explain the value of being properly insured, explain every feature being proposed and we also offer additional options that are available and lead the customer to making a wise decision for their protection.

          On home policies, just to make sure that the reconstruction cost is fair and accurate, Farmers uses a third party Marshall & Swift/Boeckh to determine reconstruction costs; and that is the figure that we use. We then consult with a customer and help them to do the right thing to protect their assets.

          We don’t convert all of our prospects to Farmers and that isn’t our vision. Our vision is to do the job right and make sure that the customer is well served and protected in a manner that brings good value. We offer great tailored advice and make sure that the coverage and policy features adequately protect our customers. If we don’t earn someone’s business today we will quote it again next year and we often earn business on the second and third years. We maintain a high retention rate and referral ratio by doing business this way and we will continue to be proud of the products and service that we offer. We don’t want to be the “Low Cost Leader”, we are the “Low Risk leader”.

          • September 14, 2012 at 9:48 am
            Agent says:
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            Dean, you sound like you have been trained better than some of the Farmers Agents we have in our area. Most of them do sell minimum limits on Auto and the HO valuations are a joke compared to what other carriers are using on Replacement Cost. You seem to be happy with what Farmers is doing, but there are a lot of their agents who would like to be independent since they are after our marketing reps asking for appointments since Farmers is just one market and when rates go up, you have no other place to go.

  • September 12, 2012 at 9:42 am
    Sharon says:
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    Our Travelers marketing rep was in to talk about their “new” rates, etc – and then told us that in CT the are decreasing commissions on mono line homes – and made it sound like the loss of revenues is no big deal to our agency! And he made it clear they do not want mono line dwelling fire, or home, and for that matter auto!!!

    • September 12, 2012 at 10:30 am
      Agent says:
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      We have always tried to bundle coverages so the companion credits will kick in on both policies. Travelers might have a decent HO if the house is new, has alarm system etc, but then you rate the Auto and it will be out of whack overall, so we have to sell another company. It is really hard to find the ideal customer that is squeaky clean for Home & Auto.

    • September 17, 2012 at 10:22 am
      Dan Stewart says:
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      We’re in NY and they just cut commissions here as well. Travelers has never been loyal to their agent base. Remember when they were selling their personal lines products at Citibank locations with a deviated rate? This company is a joke. Not only do they take rate but they also cut commissions!!!

  • September 13, 2012 at 8:21 am
    Clay says:
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    They are worth 100 Billion and while all of us lose during this downturn in the economy, they have their hands in the states administrative judges pockets, South Carolina warded off their 50% increase, to 25, now we are standing in cow dung up to our shoulders and not to our eyeballs. Travelers and NCCI take alleged high risk states and get in with the workers comp as sole providers, falsify audits and expences ratings and “no lawyer” will fight them “no lawyer” around here, so they control everything, since statute governs that it’s though rating agencies, NCCI, which both Travelers, Zurich and NCCI “are” Racketeering influence corrupt organazations (in a full hearing in the 5th Circuit.(sandwich chef vs. Reliance) Any Attorney General could shut this down, but that kind of money buys too much influence, ergo, they own us.

  • September 13, 2012 at 1:51 pm
    PA Agent says:
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    And to top it all off Travelers just released decreased commission schedules on monoline and packaged homeowners. Yet they still say they are committed to the independent agent. They say they are getting killed on homeowners, yet their largest agent writes monoline homeowners for GEICO.

    • September 14, 2012 at 9:59 am
      Agent says:
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      We had a conference call with our Marketing Rep who gave us the good news about decreased commission on monoline homes. Fortunately, we don’t have many monoline Travelers customers since we try to bundle as much as possible. The ones we do have did not work out on Auto because Travelers was not competitive on the Auto or the customer had some tickets or accident issues. The rep said they were going to come out early next year with a more competitive Auto market, but I am not holding my breath. Another thing they do is write direct over their website for Auto. I don’t know how that is working out for them, but their promise to refer home business to agents where they write the Auto is not working since we have yet to get a referral. As I stated earlier, they aren’t very agent friendly. The rep admitted they aren’t growing in her territory and this is all about getting the Combined Loss Ratio down. We will suffer as a result. It is a good thing we have 4 good markets to move business to or we would be in trouble.

    • January 2, 2013 at 4:30 pm
      Agent says:
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      PA, If they were committed to the Independent Agent, they wouldn’t be selling Auto direct on their website. I wonder how that is working for them. Some years ago, Safeco got a wild hair and tried it only to cut it off after a year or so and letting their Personal Lines VP go. We are still waiting for our first HO referral from their Direct Auto sales as was promised by Marketing.

  • September 14, 2012 at 11:56 pm
    sips says:
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    From what many of my Travelers friends tell me… the beatings will continue until morale improves. EE’s are overworked, not recognized for their efforts, told to put company needs before family, and on and on. Quite a few are just waiting until the job market improves so they can jump ship for a better opportunity. The day to day folks don’t like to lose their business and are frustrated by management demands, but have to take it on the chin for now. It sounds like things have taken a downturn since the merger with St Paul a few years back.

    • September 17, 2012 at 10:55 am
      Agent says:
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      We just got an email that Travelers cut their Regional Marketing Director loose so they are in the cost saving mode now as well. I wonder if the Marketing Reps are next. There is no growth going on with this company and investment income cannot be all that good, so we will continue for a while seeing where this all goes.

  • September 17, 2012 at 10:29 am
    Retired UW says:
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    I think you agents are your own worst enemy. Why do you beat up 12 markets to quote an already underpriced account, cut it 20% at each renewal, then boast about how you delivered the cheapest deal at 1/2 the commission you made 3 years ago? Rates are not supposed to be inadequate, excessive or unfairly discriminatory.

    You will be out of business if you don’t support adequate pricing. Your contingency agreements have a loss ratio component, right? How do you get a bonus check when the company’s combined is 107%.

  • September 17, 2012 at 2:27 pm
    Ok Captive says:
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    Seems like home rates are going up in a lot of companies. My guess is with the down turn in the economy, people are doing less maintenance and then you get the occasional guy with the fraudulent claim that gets paid. That all adds up. Makes underwriting the risk and inspecting each home more critical. In my area, Travelers was too cheap. I had a prospect whose $220K home policy is costing him $289/yr. At that rate, 30 years of premium is only $8670. That won’t even cover a small claim. I fully believe that we should be fair with our customers, but this isn’t just a Traveler’s thing.

    • September 17, 2012 at 3:35 pm
      Agent says:
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      It is hard for me to believe Travelers ever wrote a $220K home in Oklahoma for $289/yr. Oklahoma has been known to have Tornados, Hail Storms on occasion just like we do in Texas. Our quotes are typically $1,000-1,500 for that value depending on score, age of home, losses etc. I agree that it was too cheap if that is what it ran. Back in their heyday when they were going strong, we got HO premiums on the above value in the $650-800 range. Due to 3 years of unending rate taking, it has almost doubled on a similar value. I agree with sips that company morale is low right now. They are apologetic that their rates are high now and there isn’t a thing they can do about it except watch their business go out the back door during this blood letting.

  • October 9, 2012 at 6:34 pm
    Lisa says:
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    Jon – let me say WOW. I had 2 claims that were due to my neighbors hotwater heater leaking two times in one week. I was told they were seperate claims. They paid me…and subrogated to the neighbors insurance. Then I called thinking I had another claim but found out I was wrong no biggie…then opening my mail today found my rates DOUBLED. The rub is neither claim was my fault and the 3rd one wasn’t really a claim. But they are saying I am a risk.

  • January 2, 2013 at 12:17 pm
    RJ says:
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    I have commercial policies so this may be off topic, however my premium for a 9 unit low income housing apartment building was $3,900 in 2012, it is due for renewal at the end of Jan, my agent sent me the policy renewal information via mail mid Nov. I wasn’t really paying attention (my fault) as the Holiday Season pretty much consumed all my time this year. I sat down to do some 2013 planning between Christmas and New Year and found the policy information and the 2013 premium is $7,800 a 100% increase. Keep in mind I maintain a $10,000 deductible as I really only want to insure for significant or total loss and liability.

    Two things are significantly wrong here, 1) Jay and Travelers have their heads firmly up their … and 2) when my agent saw this he should have called instantaneously to let me know that not only was this not acceptable to me but unacceptable to him as well and he’d be shopping my policy to get me the best coverage and rates, especially with a $10,000 deductible.

    Travelers is an insurance company so if they don’t understand the market, that’s their problem and their business to win or lose. The agents, on the other hand, serve 2 masters. They get paid from the insurance company by placing the client policy with the insurance company. They serve the needs of their purchasing clients, to maintain the clients continued business by finding the best coverage and rates for the client. If the agent doesn’t serve the needs of the client then they lose the revenue they would receive from placing the policy with the insurance company.

    So in this scenario, although I’m annoyed at Travelers, I don’t really trust people that get paid on commission so I’m beside myself as to the ethics and lack of customer service provided from my agent. My agent did nothing until I called him on it, so I have to wonder about his motivation. Now, miracle of miracles, he’s found something more reasonable and in line with the coverage and cost of the prior year from another carrier. All found in the matter of a couple hours. Huh, excuse me!?

    Agents, read my lips, we the consumer are not stupid, yes we often just let the flow carry us along with the renewal stream etc. However to earn your money you should be doing some work, the very least of which would be shopping for the best coverage and rates for the clients. At some point the light will come on for the client, it always does and you know it, so if you haven’t had our best interests in mind when the light comes on you’ll be out of a client like this agent will shortly be. Most of us may only have a policy or two I have multiple commercial, residential, auto and even aircraft so you do the math on what this agent just did. We the consumers and clients may have born at night; however it was not last night!

    I’ll also be writing a letter to Jay asking how the -$3,900 revenue stream is working for him and there will be more of the less coming as the year progresses, at least from me anyway. CEOs and other upper management types make entirely too much money, they’ve obviously lost touch with reality.

    • January 2, 2013 at 4:35 pm
      Agent says:
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      Why are you slamming the agent RJ? Perhaps you just had the wrong one. We are very diligent to protect our policyholders and have to remarket all the time when carriers want to take rate. I have had to move several accounts from Travelers to other markets when they felt they had to give a double digit rate increase. I do the same for other markets who take unnecessary rate. We either get them to come down to reasonable or we send it somewhere else. If we can’t do any good after exhausting our options, we level with the insured and show them the coverage and cost.



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