SAFECO Increases Rates for 2002

Seattle-based SAFECO Corp. has announced its plans to increase rates for its personal and commercial auto insurance policies in 2002.

According to Associated Press, SAFECO president Mike McGavick stated the company’s intentions to increase auto insurance rates by 7 percent and homeowners rates by 12 percent over the year.

Additionally, commissions paid to agents were decreased for homeowners’ policy sales from 15 percent to 10. Auto insurance policies, however, paid out 17 percent in commission for a six-month policy, compared to 10.

SAFECO is also planning to make available a new computerized system to determine costs of auto insurance policies for individuals in 38 states.

McGavick hopes the new system will increase profits, allowing SAFECO to recommend suitable policies for most consumers that seek their services.

McGavick took note of rising insurance rates in the industry, stating that the property casualty industry is being more realistic in its underwriting and charging consumers reasonable rates for new policies as well as renewals.