United Fire CEO says 'targeted' prices increase will be explored

United Fire & Casualty Co. President Randy Ramlo told shareholders at today's annual meeting that “targeted” price increases will be explored this year as the insurance industry continues to recover from some tough years.

Ramlo ruled out across-the-board price increases, saying the insurance market is still “soft.” He noted that United Fire's pricing is still above the industry average.

Wednesday's annual meeting was the first time shareholders met after the death of former Chairman Scott McIntyre in October 2009. McIntyre presided over previous shareholder meetings.

United Fire Chairman Jack Evans called the  meeting to order after a video tribute to McIntyre was shown in a new first floor meeting room at the company's headquarters, 118 Second Ave. SE in Cedar Rapids. Unlike McIntyre, Ramlo used a PowerPoint presentation to complement his remarks about the company's financial status.

Ramlo said lawsuits in connection with claims from Hurricane Katrina continue to affect United Fire's loss ratio. He said the company settled several large claims in the past year and Katrina claims should have far less of an impact on United Fire's loss ratio in 2010.

Ramlo shared several uses of technology that United Fire is employing to speed up the filing of loss claims, determine potential liability before writing a policy and price potential risk.

United Fire is using small tablet computers to file loss claims in the field, enabling employees to spend more time in the field and less time filing reports in the office. The insurer also is making use of satellite photography to determine sources of potential liability, such as a trampoline in an unfenced backyard that was not visible from the street in front of the home.

Ramlo said computer modeling also is being used to assist underwriters as they assign premiums for coverage. He added that computer modeling will not replace employee expertise and judgment.

Last month, United Fire posted sharply higher first quarter earnings.

The insurer had net income of $19.4 million, or 73 cents per diluted share, in the quarter that ended March 31, compared with $3.3 million, or 12 cents per share, in the same quarter of 2009.

Revenues rose 5 percent to $145.1 million from $138.3 million in the first quarter of 2009.