Kalim Abumane's questions to Mercury General Corp (MCY) leadership • Q4 2024
Question
Kalim Abumane from Kornit Capital requested details on the wildfire claims, including the number of total losses and specifics on the $800 million paid out. He also asked for clarification on the methodology for the $1.6B to $2.0B gross loss estimate, whether it includes reinstatement premiums, and the status of discussions with reinsurers about classifying the fires as two separate events.
Answer
An executive, Victor, stated that about 2,700 claims were reported, with approximately 800 total losses, and that over 95% of these have had Coverage A limits paid. CFO Theodore Stalick explained the gross loss estimate is derived by applying historical payout percentages to the Total Insured Value (TIV) of known total losses, plus an estimate for partials. He confirmed the $80M-$101M reinstatement premium is not included in that gross estimate. CEO Gabriel Tirador added that while they are receiving no pushback from reinsurers on a two-event classification, the strong subrogation potential makes it less likely they will pursue that option.