CURE In the News

Not-for-Profit Auto Insurer NJ Cure Names Chief Financial Officer

By Regina Whitmer

PRINCETON, N.J. January 19 (BestWire) - Not-for-profit automobile insurer NJ Cure has named Steven P. Kerner as chief financial officer of the rapidly growing company.

Kerner was controller of New Jersey Manufacturers Insurance Co., a leading provider of private-passenger auto insurance in New Jersey and the model used by New Jersey Citizens United Reciprocal Exchange when it was created in 1990.

"New Jersey Manufacturers has always had a very profitable book, despite how bad New Jersey's auto market has been," NJ Cure Vice President of Operations Eric Poe said. "When we started New Jersey Cure with just 15 people in 1990, half our management team was taken from New Jersey Manufacturers. The reason (Kerner) is such a good fit is that he comes from the same environment where they focus on underwriting being the most important part of a successful insurance operation."

NJ Cure is a reciprocal exchange, which means premiums are used to pay management fees and claims. Money remaining after those expenses either is returned to the company to prevent future rate increases or is returned to policyholders.

The company currently insures 55,000 vehicles, compared with 25,000 three years ago, Poe said. The number of employees has gone from 90 to 220 in the past two years.

Poe says this "grassroots growth" is done through drivers who are good risks.

"Despite our growth, we have membership requirements like New Jersey Manufacturers does," Poe said. "Less than 15% of the people who call us for quotes join us. One third are not approved because they don't meet membership requirements."

Coverage is denied if a driver in the household has fewer than three years of licensed driving experience or if a driver's record includes more than one chargeable accident and/or a certain number of points for moving violations in the prior three years.

NJ Cure was founded in 1990 by former state insurance commissioner James J. Sheeran and insurance actuary Lena Chang. The company recently announced discounts of as much as 20% for long-term policyholders with accident- and loss-free driving records. The company's "forgiveness program" protects policyholders from rate increases following their first accident or moving violation.

Kerner, who lives in Ewing, N.J., was at New Jersey Manufacturers for more than 30 years, starting as a staff accountant. He became controller in 1998 and retired from the company in 2004. He then was an insurance examiner with the New Jersey Department of Banking and Insurance.

New Jersey Manufacturers Insurance Group has a financial strength rating of A++ (Superior) from A.M. Best Co.

According to 2003 A.M. Best Co. state/line information, the top five writers of all private-passenger auto insurance in New Jersey, based on direct premiums written, were: Allstate Insurance Group, with an 13.2% market share; State Farm Group, with 12.9%; NJM Insurance Group, with 12.6%; Liberty Mutual Insurance Cos., with 11.1%; and Palisades Group, with 9.8%.

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