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
5/19/03
Date of Report (Date of earliest event reported)
Safeco Corporation
(Exact name of registrant as specified in Charter)
WASHINGTON 1-6563 91-0742146
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
Safeco Plaza, Seattle Washington 98185
(Address of principal executive offices) (Zip Code)
(206) 545-5000
(Registrant's telephone number, including area code)
TABLE OF CONTENTS
Item 5 Other Events and Regulation FD Disclosure
Signature
Item 5. Other Events and Regulation FD Disclosure
The following press release was furnished today by Safeco Corporation.
FOR RELEASE AT 1:30 PACIFIC TIME
INVESTOR RELATIONS CONTACT: Neal Fuller, 206-545-5537
Christine Mead, 206-925-1448
MEDIA RELATIONS CONTACT: Paul Hollie, 206-545-3048
SAFECO ESTIMATES STORM LOSSES
SEATTLE -- (May 19, 2003) -- Safeco (NASDAQ: SAFC) announced today that
claims stemming from the recent string of Midwest and Southern tornadoes, added
to losses from violent hailstorms in Texas earlier in the quarter, are estimated
at nearly $90 million in pretax catastrophe losses. This figure represents
losses through May 16, with six weeks remaining in the quarter. The effect on
second-quarter net income is currently estimated to be $0.42 per diluted share
on an after-tax basis.
"Insurance is about delivering on promises," said Mike McGavick, Safeco
chairman and chief executive officer. "These horrible storms show why our
product is so important. By providing fast, personalized claims service, we can
help the people affected. That's exactly what we are doing."
Safeco's National Catastrophe Team began assessing the situation
immediately after the first tornadoes touched down on May 4. Surveyors and
adjusters were in the field within hours, issuing payments to Safeco customers
for emergency repairs and living expenses. As the storms continued, additional
claims staff from around the country supplemented the national team to assist
with the volume of claims.
In Safeco's first-quarter earnings announcement on April 28, the company
stated that losses from Texas hailstorms in early April totaled approximately
$30 million, ending the recent trend of relatively low weather-related
catastrophe losses. The tornadoes and other severe weather events in six states
are expected to add more than $55 million in losses.
Safeco will announce its second-quarter financial results on Monday, July
28.
Safeco, in business since 1923, is a Fortune 500 company based in Seattle
that sells insurance and related financial products through independent agents
and financial advisors nationwide.
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FORWARD-LOOKING INFORMATION CONTAINED IN THIS
NEWS RELEASE IS SUBJECT TO RISK AND UNCERTAINTY
Statements, analysis and other information contained in this news release that
relate to anticipated financial performance, business prospects and plans and
similar matters are "forward-looking statements" as defined in the Private
Securities Litigation Reform Act of 1995. Statements in this news release that
are not historical information are forward-looking. The operations, performance
and development of our business are subject to certain risks and uncertainties
that may cause actual results to differ materially from those contained in or
suggested by the forward-looking statements in this news release. The risks and
uncertainties include, but are not limited to:
o the ability to obtain rate increases and decline or non-renew underpriced
insurance accounts;
o achievement of premium targets and profitability;
o realization of growth and business retention estimates;
o achievement of overall expense goals;
o success in implementing a new business entry model for personal and
commercial lines;
o success in obtaining regulatory approval of price-tiered products and the
use of insurance scores, including credit scores as a component;
o the ability to freely enter and exit lines of business;
o changes in the mix of Safeco's book of business;
o driving patterns;
o the competitive pricing environment, initiatives by competitors and other
changes in competition;
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 man-made disasters, such as the attack on
September 11, 2001 or war;
o the occurrence of bankruptcies that result in losses under surety bonds,
investment losses or lower investment income;
o the adequacy of loss and benefit reserves for the Property & Casualty and
Life & Investments businesses;
o the ability to run off the Lloyds of London business without incurring
material unexpected charges;
o the availability of, pricing of, and ability to collect reinsurance;
o the ability to price for, exclude and reinsure the risk of loss from
terrorism;
o interpretation of insurance policy provisions by courts, court decisions
regarding coverage and theories of liability, trends in litigation and
changes in claims settlement practices;
o the outcome of any litigation against us;
o legislative and regulatory developments affecting the actions of insurers,
including requirements regarding rates and availability of coverage;
o changes in tax laws and regulations that affect the favorable taxation of
certain life insurance products or that decrease the usefulness of life
insurance products for estate-planning purposes;
o the effect of current insurance and credit ratings levels on business
production and the effect of negative changes to our ratings;
o inflationary pressures on medical care costs, auto parts and repair,
construction costs and other economic sectors that increase the severity of
claims;
o availability of bank credit facilities;
o the profitability of the use of derivative securities by Safeco Financial
Products, Inc. (SFP);
o fluctuations in interest rates;
o performance of financial markets; and
o general economic and market conditions.
We assume no obligation to update any forward-looking statements contained in
this news release.
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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 thereunto duly authorized.
Safeco Corporation
Registrant
Dated: May 19, 2003 By: /s/Christine B. Mead
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Christine B. Mead
Senior Vice President,
Chief Financial Officer and Secretary