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STATE FARM MUTUAL CONTRIBUTES $2 BILLION TO FIRE SUBSIDIARY

 STATE FARM MUTUAL CONTRIBUTES $2 BILLION TO FIRE SUBSIDIARY
 BLOOMINGTON, Ill., Oct. 6 /PRNewswire/ -- State Farm Mutual Automobile Insurance Company has contributed $2 billion to the capital base of its homeowners and commercial insurance subsidiary, the State Farm Fire and Casualty Company.
 State Farm Fire and Casualty expects to spend more than $1.6 billion on behalf of its policyholders on claims arising from Hurricane Andrew, the most costly natural catastrophe in the company's history. In addition, it expects to pay $194 million for insured damage from Hurricane Iniki in the Hawaiian Islands.
 Before Hurricane Andrew, the costliest catastrophe for State Farm Fire had been 1989's Hurricane Hugo, which produced claims of $460 million.
 Since Hugo, the company has been hit by a string of costly disasters, including $365 million in the 1991 Oakland, Calif., fire, $267 million in the 1992 hailstorm in Fort Worth and Arlington, Texas, $187 million in a hailstorm in Denver, Colo., and $120 million in the 1989 Loma Prieta earthquake near San Francisco.
 "The catastrophes we have faced in recent years clearly demonstrate not only the financial strength of the nation's insurance companies," said State Farm President Edward B. Rust Jr., "but also the need for that strength in our industry. The $2 billion contribution to State Farm Fire and Casualty will reassure the homeowners we insure across the country that we will be there to pay their insured losses."
 -0- 10/6/92
 /CONTACT: Bob Sasser of State Farm., 309-766-2625/ CO: State Farm Mutual Automobile Insurance Company ST: Illinois IN: INS SU:


AH -- NY035 -- 6999 10/06/92 10:58 EDT
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Publication:PR Newswire
Date:Oct 6, 1992
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