COLUMBUS, Ohio -- May 20, 2002 -- State Auto Financial Corporation (Nasdaq:STFC) today announced that storms would contribute between $20 to $22 million to losses in the second quarter, adding 9 to 10 direct loss ratio points to second quarter results. High winds, tornados and hail caused severe damage in 13 of the company's operating states between April 27 and May 1. An F5 tornado that touched down in La Plata, Maryland proved to be the most serious single event, resulting in claims in excess of $8 million.
State Auto Chairman Robert H. Moone stated, "Conclusively estimating the ultimate loss from storms such as these is difficult because of uncertainties surrounding the impact of business interruption, debris removal and other extra expense coverages. Likewise, the "long tail" nature of hailstorm losses complicates the process. However, we are far enough along with our claims work to be comfortable with these loss projections." Moone praised the work of the State Auto claims group and agency force. "This is the side of our business that matters the most. We put a very effective team in the field - thorough and professional in every sense. I'm always impressed that such a major effort can be that coordinated and executed so efficiently."
State Auto Financial Corporation is a regional property and casualty insurance holding company engaged primarily in writing personal and commercial automobile, homeowners, commercial multi-peril, workers' compensation and fire insurance. The company currently markets its products through more than 22,000 agents associated with approximately 3,800 agencies in 26 states. Products are marketed primarily in the Midwest and Eastern United States, excluding New York, New Jersey and the New England states.
Except for historical information, all other information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. The most significant of these uncertainties are described in State Auto Financial's Form 10-K and Form 10-Q reports and exhibits to those reports, and include (but are not limited to) legislative changes at both the state and federal level, state and federal regulatory rule making promulgations and adjudications, class action litigation involving the insurance industry and judicial decisions affecting claims, policy coverages and the general costs of doing business, the impact of competition on products and pricing, inflation in the costs of the products and services insurance pays for, product development, geographic spread of risk, weather and weather-related events, and other types of catastrophic events. State Auto Financial undertakes no obligation to update or revise any forward-looking statements.