Mercury Insurance Group (NYSE: MCY) is a multiple-line insurance organization offering personal automobile, homeowners, renters and business insurance. Founded in 1961 and headquartered in Los Angeles, Mercury has assets in excess of $4 billion, employs 4,500 people and has more than 8,000 independent agents in 11 states (Arizona, California, Florida, Georgia, Illinois, Nevada, New Jersey, New York, Oklahoma, Texas and Virginia).
Mercury’s primary focus is auto and homeowners insurance, however, the company also writes personal liability policies (umbrella), business insurance, mechanical breakdown protection (similar to an extended warranty for your vehicle), renters, service line protection, home systems protection, identity management protection and ride-hailing insurance.
History
Mercury founder George Joseph, who flew 50 World War II missions over Africa and Italy as a navigator before graduating from Harvard on the GI Bill in 1949 , decided his Ivy League math degree fit nicely into the actuarial world of insurance. Joseph then spent more than a decade in the industry before founding Mercury Insurance in 1961 as a low-cost alternative to larger insurance companies.
Mercury General Corp., which consisted of six employees sold its first policy April 1, 1962. Now, it’s one of California’s largest insurance providers in the state.
Mercury’s California expansion began in 1964 with the opening of its first Orange County office. Two years later, the company spread into the San Fernando Valley and also began operations in San Diego. Mercury offices opened in Northern California by 1968.
Mercury wrote $1 million in premiums per month by 1970, sold its first homeowners policy in 1972 and in 1973 the company celebrated its 10th consecutive year of revenue growth. Newly created Mercury Insurance Company wrote its first auto policy in 1977.
Mercury expanded outside of California, opening offices in Georgia and Illinois beginning in 1989.
The company insured more than 1 million vehicles in California by 1998. This led to further growth into Florida (1998), New York (2001) and Virginia (2001).
Forbes lists Mercury Insurance on its “100 Most Trustworthy Companies†in 2012 “America’s 50 Most Trusted Financial Companies†in 2014, 2015 and 2016. It has been rated A+ “Excellent†by insurance industry rating agencies A.M. Best and Fitch.
In 2017, the company was named a “Top Five Best Auto Insurance Company†by Insure.com, who surveyed more than 3,700 U.S. insurance customers on the criteria of “customer service,†“claims handling,†“pricing,†“plans to renew current policy,†and “would recommend the insurer.†Additionally, Mercury Insurance was named one of “America’s Best Midsize Employers†by Forbes magazine in 2017.
Mercury is currently operating in 11 states: Arizona, California, Florida, Georgia, Illinois, Nevada, New Jersey, New York, Oklahoma, Texas and Virginia.
Mercury is led by President and CEO Gabriel Tirador, and Joseph is Chairman of the Board.
Criticism
A March 2007 market conduct exam by the California Department of Insurance alleged that Mercury Insurance may have repeatedly engaged in practices that discriminated against active members of the U.S. military, the unemployed, those of certain occupations such as bartenders and painters, and unmarried adults living together. Additionally the company was alleged to have been inconsistent in its application of certain discounts, which resulted in some of its customers being overcharged.
Representatives of Mercury Insurance were quick to argue that the leak of the conduct exam was a politically motivated move meant to benefit California Insurance Commissioner Steve Poizner, a Republican candidate for California governor in the 2010 gubernatorial election.
Subsidiary: Workmen's Auto Insurance Company
Workmen's Auto Insurance Company (Workmen's) is a nonstandard auto insurance company. For the first 65 years of business it was family owned and operated by the Shammas family. Today Workmen’s is a wholly owned subsidiary of Mercury General Corporation. The company is headquartered in downtown Los Angeles. Workmen’s sells personal lines automobile insurance mainly through independent agents. The Company is licensed in 22 states and actively doing business in seven states â€" California, Florida, Georgia, Idaho, Nebraska, Nevada, and Utah. Workmen’s works with small independent agents, often located in small towns and rural areas, this is a crucial part of its business model.
History
Workmen’s Auto Insurance Company was incorporated in 1949 in Los Angeles, California, by R. Leslie Kelley, the originator of Kelley Blue Book. In 1959, Mr. Kelley sold the Company to Mr. Nickolas N. Shammas, a prominent businessman in downtown Los Angeles.
Mr. Shammas wanted to diversify his investments, believing that insurance nicely balanced his other core businesses, automobile dealerships and commercial real estate. During the majority of the 45 years that Mr. Shammas owned Workmen’s it was a small California auto insurance company that wrote about $20 to $30 million in premiums each year. In 1987 with the passing of Prop 103, Workmen’s decided to expand beyond California at this point so as not to have all its eggs in the California insurance market basket.
Mr. Shammas died of lung cancer in the summer of 2003. At that time his eldest daughter, Carole Shammas, stepped in to take a more active role in the Company. For 14 years the Company was owned by 3 generations of the Shammas Family â€" matriarch, Jeanette H. Shammas (37.4%), daughters, Carole Shammas and Diane Shammas (60.4%) and granddaughter, Julia Holter (2.2%).
At its height from 2002 to 2005 Workmen’s conducted business in 16 states and wrote as much as $130 million in premiums. Thereafter, cyclical trends in insurance and then the Great Recession of 2008 led the Company to downsize.
In December 2009, the company's 60th anniversary, the brand was refreshed with a new logo, website and image.
Effective January 2, 2015 Workmen’s became a wholly owned subsidiary of Mercury General Corporation.
Current products
- Auto insurance: Workmen’s offers one main type of policy for vehicle insurance in the United States. They sell non-standard car insurance to individuals that are unable to secure coverage through standard insurance companies. This can be due to a driving record with accidents and/or tickets, prior DUI, the driver's age, vehicle type, or others.
Competition and memberships
Workmen’s competitors vary depending on the state but in general its major competitors include Infinity Property & Casualty Corporation, Dairyland also known as Sentry Insurance, Access, Alliance United and Foremost acquired by Farmers Insurance Group. Workmen’s is a member of PCI, Property Casualty Insurers Association of America and very active in its local affiliate ACIC. As a small company, it is not rated by A.M. Best.
Legal
Workmen's in order to be compliant with the law, each year has to file an annual statement with the California Department of Insurance. The company is also required to have a National Association of Insurance Commissioners number (NAIC#13250). This number is required to be used at all times as it allows NAIC to regulate all insurance companies conduct in the respective state or territory they have business in order to protect the interests of insurance consumers.
See also
- List of United States insurance companies
References
External links
- Mercury Insurance Group's website
- Workmen's Auto Insurance Company's website
