GEICO Corp. beat out its competitors in premium growth in 2013 and reported one of the best underwriting margins among the top 20 U.S. auto insurers.

According to a report by SNL Financial, GEICO’s direct personal auto premiums, prior to consideration of reinsurance, increased 11.3 percent to $18.6 billion in 2013, the largest percentage increase of the top 20 personal auto insurers and GEICO’s largest percentage of annual premium gain since 2005.

SNL Financial said the next best year-over-year gain produced by a competitor in the top 20 was almost 200 basis points lower. Liberty Mutual Holding Co. Inc. wrote just over $9 billion in direct personal auto premium and registered a 9.4 percent year-over-year premium increase.

SNL AUTOIn its 2013 annual report, GEICO parent Berkshire Hathaway Inc. attributed GEICO’s growth to a 7.8 percent increase in voluntary auto policies-in-force, reflecting a 12.1 percent increase in voluntary auto new business sales. Higher average premiums per policy contributed the growth to a “lesser degree,” according to the report.

The SNL analysis shows that GEICO has grown premiums robustly nationwide. For example, GEICO grew premiums by 18.0 percent in California and 21.4 percent in Texas, its third and fourth largest states, respectively.

Meanwhile, GEICO continued to increase market share in states where profitability has been problematic of late. GEICO increased its market share in New York to 28.6 percent and increased its share of the Florida private auto market to 19.26 percent. In addition, GEICO increased its premium in Michigan by over 40 percent and increased its market share to 2.7 percent from 1.9 percent.

The SNL analysis also shows that Allstate and Travelers each dropped a position in ranking.

Erie jumped up two, while Mercury fell two.

Source: SNL Financial

Topics Trends Auto Personal Auto Pricing Trends