INSURANCE FIRM'S ANTIHERO? 21ST CENTURY'S MARLOW'S A GUIDE IN A WORLD OF SUPERSALESMEN.

Byline: Evan Pondel Staff Writer

WOODLAND HILLS - In a room full of high-powered insurance executives, Bruce Marlow might be considered an antihero.

A modestly dressed product of the 1960s, his affinity for folk music and his two dogs seem a far cry from the combustible world of soaring premiums and fraudulent claims. But this 53-year-old Ivy Leaguer takes a contrarian approach toward auto insurance.

``I don't think it should be mandatory. It's not fair to those who can't afford the premiums,'' said Marlow, president and chief executive officer of 21st Century Insurance.

In an era when policyholders are attempting to cope with rising premiums, running a publicly traded auto insurance company is also a challenge, especially if the past is riddled with catastrophe.

Marlow joined Woodland Hills-based 21st Century in February 2000, several years after the 1994 Northridge Earthquake began to drain the company's coffers. Yet the financial aftershocks continue as the company said in January that it would take a fourth-quarter charge of $50 million related to claims.

The onslaught of claims and litigation ultimately has led the company to exit the homeowners insurance business indefinitely. Today, 21st Century stands as the ninth-largest publicly traded auto insurance company in the nation. And it's attempting to bill itself as ``the company that insures anything with wheels,'' Marlow said.

Echoing this mantra, 21st Century introduced motorcycle insurance in May. The company launched its new product with a motorcycle rally led by actor Erik Estrada, who played Frank ``Ponch'' Poncherello on the 1977-83 cop show ``CHiPs.''

To compete in the California auto insurance arena, employing such marketing techniques has become necessary for survival. ``You have to be very aggressive and you must be attentive to your customers in these times,'' said Peter Moraga, spokesman for the Insurance Information Network of California.

In 2000, 21st Century controlled about 6.3 percent of the auto insurance industry in California, according to the California Department of Insurance. The insurer's loss ratio, a percentage of what the company is losing in earned premium, was 73.9 percent in 2000. In theory, the lower the percentage, the more profitable the company.

To propel 21st Century forward and capture a greater market share, Marlow has advocated a policy that educates consumers. The company has released several guides in the past year, including a child safety seat pamphlet, a crash test ratings guide and an Insider's Guide To Buying California Auto Insurance. If the guides are perceived as glorified advertising opportunities, Marlow doesn't care.

``The more the consumer trusts the insurance company, and the better educated they are, it's a win-win situation for all,'' said Marlow, with several of the guides fanned out across his desk.

Many of 21st Century's policyholders reside within blocks of Marlow's spartanly furnished office. His panoramic view of the San Fernando Valley seems to have influenced 21st Century's customer-service standards.

``When you talk to the customers, it's like you're practically talking to your neighbors,'' said Marlow, gazing out the window.

With a 90 percent annual retention rate among policyholders, 21st Century attempts to market its honesty, suggesting that prospective clients shop around before choosing a policy. Moraga said the company's reputation has always been strong in the industry for this reason.

``They've also been very innovative when it's come to their products,'' he said.

However, that innovation hasn't quite translated to 21st Century shares. The stock has traded between $14 and $21 on the New York Stock Exchange for most of the year, though it has seen a recent resurgence. Shares gained more than 2 percent, or 39 cents, to close Tuesday at $19.10.

The few analysts that actually cover the company declined to comment.

Indeed, Wall Street may have grown disenchanted with the insurance sector as fraudulent claims and rising repair costs continue to hurt the industry. Moraga said juries heard about 316,000 lawsuits involving auto insurance in 1999, compared with 175,000 in 1994.

``Many companies are losing a lot of money, unable to keep pace with the rising costs of cars,'' Moraga said.

``The industry is finding itself in a difficult position.''

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Photo:

(color) Bruce Marlow, president and CEO of 21st Century Insurance, talks about the firm's new TV spots as they run behind him - and on him.

Charlotte Schmid-Maybach/Staff Photographer