After revealing estimated losses from Southern California wildfires that might surpass its $150 million reinsurance retention level, Mercury General (MCY, Financials) shares plunged 18% on Friday to end at $49.76.
Mercury claims that the starting on Jan. 7 flames caused extensive damage in the area. The business stated they would exceed the limit of reinsurance retention even though it does not yet have a precise assessment of the overall losses.
Once damages go over $150 million, Mercury's reinsurance program offers $1.29 billion in per-occurrence coverage, according to its statement. Mercury said, the software also includes evaluations under the California FAIR Plan. Mercury estimates that premiums for the reinstatement would equal $101 million should the full reinsurance limits be restored.
Mercury stated, claims adjusters are helping policyholders. The company's online claims site offers direction on submitting claims, the statement stated.
Based in Los Angeles, Mercury provides personal car and house insurance in several states. The corporation said in its statement that additional evaluations of the effect of the incident will determine updates on the losses.
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