State Farm Posts $2.8 billion Loss for 2002
NU Online News Service, Feb. 28, 3:45 p.m. EST?State Farm Insurance Companies reported a net loss of $2.8 billion for 2002, an improvement over its 2001 results when the company posted a loss of $5 billion.
Last year's progress was helped by better insurance operating results and federal income tax recoverables, the company said.
State Farm premium revenue was $44.4 billion in 2002, an increase of 11 percent over the 2001 figure of $40.0 billion. The company's 2002 results also included a loss of $1 billion in write-downs for impairment of invested assets.
The total revenue last year–which includes premium revenue, earned investment income, and realized capital gains and losses–was $49.7 billion, an increase of $3 billion from the 2001 result of $46.7 billion, State Farm said.
Net worth for the State Farm group, however, declined by $6.3 billion to $31.8 billion. The company said the general market decline led to a $4.7 billion after-tax realized and unrealized loss on property-casualty companies' unaffiliated stock portfolio.
State Farm stated that its p-c companies had a combined-underwriting loss of $6 billion on earned premiums of $41 billion. These figures, combined with net investment income earned and other income of $3.3 billion, resulted in a pre-tax operating loss of $2.7 billion.
The losses were smaller than the figures State Farm's p-c companies reported in 2001. In that year, there was a pre-tax operating loss of $5.8 billion and a net loss of $5.1 billion, including an underwriting loss of $9.3 billion on earned premiums of $36.9 billion.
Headquartered in Bloomington, Ill., State Farm is the largest auto and home insurer in the United States, insuring more than 40 million cars and nearly 15.6 million homes in the U.S. and Canada.
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