UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)OF THE
SECURITIES EXCHANGE ACT OF 1934
09/20/01
Date of Report (Date of earliest event reported)
SAFECO CORPORATION
(Exact name of registrant as specified in Charter)
WASHINGTON 1-6563 91-00742146
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
SAFECO Plaza, Seattle, Washington 98185
(Address of principal executive officers) (Zip Code)
(206) 545-5000
(Registrant's telephone number, including area code)
Item 5. Other Events
SAFECO Announces Loss Estimates From September 11 Attacks
SEATTLE -(September 20, 2001)-SAFECO (NASDAQ: SAFC) announced today that its
primary insurance lines will incur estimated losses of $25 million, net of
reinsurance, stemming from last week's attacks on New York and Washington, D.C.
In addition, SAFECO continues to review the exposure of its Lloyd's of London
operations. SAFECO currently estimates that it will incur an additional loss of
between $5 million and $10 million as a result of this exposure.
"All of us in the industry lost customers, agents, business associates and
friends," said Mike McGavick, president and chief executive officer. "We're
deeply saddened by these events, and extend our prayers to the victims and their
families.
"Our resolve to help our clients recover from this national tragedy hasn't
wavered," he added.
Estimates of SAFECO's primary insurance include approximately $24 million in
Property & Casualty losses; and approximately $1 million in life insurance,
disability and medical insurance losses.
Total losses stemming from last week's attacks are expected to affect SAFECO's
third-quarter income by between $0.15 and $0.18 per diluted share on an
after-tax basis.
"This event will have relatively little long-term financial impact on SAFECO,"
McGavick said, noting the company has $29 billion in assets. "Still, I can't
think of a single event in recent decades that had a greater impact on our
nation."
SAFECO has assembled a team of experts to assist customers and agents with
claims from last week's events. Shortly after the attack, SAFECO contacted every
commercial insurance policyholder in the vicinity of New York's World Trade
Center to provide assistance.
In addition, round-the-clock telephone support is available to help customers
and agents with claims:
o Individuals with questions about home, auto or business insurance can obtain
assistance by calling 1-800-332-3226.
o Individuals with questions about life
insurance, deferred annuities and income annuities should call 1-877-472-3326.
o Individuals with questions about mutual funds should call 1-800-528-6501.
SAFECO, in business since 1923, is a Fortune 500 company based in Seattle that
sells insurance and related financial products through more than 17,000
independent agents and financial advisors.
FORWARD-LOOKING INFORMATION IS SUBJECT TO RISK AND UNCERTAINTY
Statements made in this report that relate to anticipated financial performance,
business prospects and plans, regulatory developments and similar matters may be
considered "forward-looking statements" as defined in the Private Securities
Litigation Reform Act of 1995. Statements in this report that are not historical
information are forward-looking. Such statements are subject to certain risks
and uncertainties that may cause the operations, performance, development and
results of SAFECO's business to differ materially from those suggested by the
forward-looking statements. The risks and uncertainties include:
o SAFECO's ability to obtain rate increases and non-renew underpriced
insurance accounts;
o Achievement of SAFECO's premium targets and profitability;
o Decrease in large-commercial premium volume;
o Achievement of expense savings from consolidation of commercial
operations;
o Achievement of SAFECO's expense reduction goals;
o Realization of growth and business retention estimates;
o Changes in the nature of the property and casualty book of business;
o Driving patterns;
o Changes in competition and pricing environments;
o Weather conditions, including the severity and frequency of storms,
hurricanes, snowfalls, hail and winter conditions;
o The occurrence of significant natural disasters, including earthquakes;
o The occurrence of significant disasters, such as the attack on Sept. 11,
2001;
o The adequacy of loss reserves;
o The availability, pricing and ability to collect reinsurance;
o Court decisions and trends in litigation;
o Legislative and regulatory developments;
o Rating agency actions;
o The effect of current ratings levels on business production;
o Availability of bank credit facilities;
o Fluctuations in interest rates;
o Performance of financial markets; and
o General economic and market conditions.
In particular, because insurance rates in some jurisdictions are subject to
regulatory review and approval, SAFECO's achievement of rate increases may occur
in amounts and on a time schedule different than planned, which may affect the
Corporation's efforts to restore earnings in the property and casualty lines.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SAFECO CORPORATION
Dated: September 24, 2001 By: /s/ H. Paul Lowber
------------------------------
H. Paul Lowber
Vice President, Controller and
Chief Accounting Officer