Fireman’s Fund Withdrawing From Mass.
NOVATO, Calif. (AP) _ Fireman’s Fund Insurance Co. said Wednesday it is withdrawing its services from Massachussetts because it cannot make a profit in the New England state.
The company and its subsidiaries, initiating a 15-month phase-out, allowed all licenses to transact insurance business in Massachusetts to expire Tuesday, said chief executive officer William M. McCormick.
Fireman’s Fund blamed the pullout on a Massachusetts involuntary automobile insurance assessment law that dumped unwanted business on Fireman’s Fund, a major multi-line insurance company.
″We are prepared to respond to claims, service existing policies, and help our agents and insureds move their business to other companies,″ McCormick told Massachusetts Insurance Commissioner Peter Hiam in a Wednesday statement. ″This is not a decision that was made lightly.″
He added that Fireman’s Fund, ″has been unable to make a profit in Massachusetts and had no expectation of doing so in the future.″
McCormick said all policy holders will be protected until their policies expire or, for some commercial customers, until the anniversary dates of their contracts.
″The assessments for involuntary business (in Massachusetts) cannot be overcome by the profits we make from the balance of our business,″ said company spokeswoman Carole Kelleher. ″Our 1986 assessment under the involuntary pool was $26 million.″
McCormick said affected employees are being provided with severance pay and offered transfers to other states where possible.
Fireman’s Fund subsidiaries affected are American Insurance Co.; National Surety Corp.; Associated Indemnity Corp; American Automobile Insurance Co., and Chicago Insurance Co.