NU Online News Service, May 19, 6:05 p.m.EDT--AIG Auto Insurance announced yesterday that effectiveJune 30 it will lower auto insurance costs by 4 percent forpolicyholders in New Jersey.

The announcement represents a growing trend among auto insurersreducing rates in the state in recent months. Selective, Chubb,Amica, Parkway Insurance, and New Jersey Citizens United ReciprocalExchange (NJCURE) have all announced rate decreases in the last sixmonths.

The AIG rate decrease will affect over 115,000 vehicles andresult in more than $5 million in savings for more than 55,000 NewJersey drivers insured by American International Insurance Companyof New Jersey, the company said.

Currently, AIG represents over 5 percent of New Jerseydrivers.

Perry Krasnove, a spokesperson for the New Jersey Department ofBanking and Insurance, said since the state approved legislativereforms for the insurance industry in 2003 there have been 29 ratedecreases between 17 auto insurers resulting in a savings of $334million.

According to Mr. Krasnove, Selective policyholders are expectedto save over $11 million while the rate reductions by Chubb willsave New Jersey drivers $1.1 million.

NJCURE recently announced discounts up to 20 percent forlong-term policyholders with accident and loss-free drivingrecords. In total, the rate reductions by these six auto insurerswill affect over 385,000 New Jersey drivers, according to statecalculations.

"The New Jersey marketplace has been very competitive since the2003 reforms and with talks of Progressive entering the market [itlooks to be] more competitive in the near future," said Mr.Krasnove.

Last summer GEICO returned to New Jersey and Esurance entered inMarch, Mr. Krasnove noted.