Commerce West Signs 3-Year, $170 Million Pact with Stonewood Agency

June 18, 2007

The Commerce Group Inc.’s California-based subsidiary, Commerce West Insurance Co., has entered into a general agency agreement with Stonewood Insurance Services Inc. of Rancho Cordova, Calif., which promise to bring the insurer up to $170 million in California private passenger automobile insurance in the next three years.

Commerce West anticipates writing $20 million in premiums during the first 12 months, $50 million during the next year and $100 million in year three of the relationship. Stonewood will be responsible for the sale of Commerce West’s Nation Safe, Protection and Select auto insurance policies through its retail distribution network throughout California.

“Through this relationship, we will continue to build a more geographically diverse business that we believe will further enhance and strengthen our company overall,” said Gerald Fels, president and chairman of the board of The Commerce Group Inc., which is based in Webster, Mass

In addition to providing sales support, Stonewood will provide Commerce West with administrative and other services, including billing, customer service, policy processing and management services.

Commerce West is a California-domiciled property and casualty insurance company, which had $56.1 million in direct written premiums in 2006. Commerce West primarily writes personal auto insurance in California.

The Commerce Group Inc. is headquartered in Webster, Mass. Its property and casualty insurance subsidiaries include The Commerce Insurance Co. and Citation Insurance Co. in Massachusetts, Commerce West Insurance Co. in California, American Commerce Insurance Co. in Ohio, and State-Wide Insurance Co. in New York.

Stonewood is a general agency that focuses on private passenger automobile insurance throughout California.

Source: The Commerce Group Inc.

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