UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report
(Date of earliest event reported)
October 7, 2003
THE COMMERCE GROUP, INC.
(Exact name of registrant as specified in its charter)
Massachusetts 001-13672 04-2599931
(State or other (Commission File (IRS Employer
jurisdiction Number) Identification
of Incorporation) No.)
211 Main Street, Webster, Massachusetts 01570
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(508) 943-9000
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The Commerce Group, Inc.
Form 8-K
October 8, 2003
Item 5. OTHER EVENTS AND REGULATION FD DISCLOSURE
The following information, including the text of the press
release attached as an Exhibit to this Form 8-K, is furnished
pursuant to Item 5, "Other Events and Regulation FD Disclosure".
On October 7, 2003, The Commerce Group, Inc. (the "Company")
issued a press release announcing that the Supreme Judicial Court
of Massachusetts, the highest court in the Commonwealth, ruled
today in favor of The Commerce Insurance Company, overturning an
April 2002 trial court decision that would have required Commerce
to cover a claim for the "inherent diminished value" of a vehicle
that was damaged in an accident.
Commerce had not previously established a reserve for any
potential liability relating to the Given litigation because it
had been unable to estimate the potential exposure that would
have resulted had the Court upheld the "inherent diminished
value" claim.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the Registrant has duly caused this report to
be signed on its behalf by the undersigned thereunto duly
authorized.
THE COMMERCE GROUP, INC.
October 8, 2003
/s/ Randall V. Becker
Randall V. Becker
Treasurer and Chief Accounting Officer
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Exhibit 99.1
Press Release
RELEASE: Immediate (October 7, 2003)
CONTACT: Randall V. Becker, Treasurer
The Commerce Group, Inc. (NYSE: CGI)
(508) 949-4129
Massachusetts High Court Rejects Claim for Diminished Value
Coverage under Massachusetts Automobile Policy
WEBSTER, Mass., October 7, 2003 - The Supreme Judicial Court of
Massachusetts, the highest court in the Commonwealth, ruled today in
favor of The Commerce Insurance Company, overturning an April 2002
trial court decision that would have required Commerce to cover a
claim for the "inherent diminished value" of a vehicle that was
damaged in an accident.
In this case, titled "Elena Given v. The Commerce Insurance Company,"
the plaintiff, Elena Given, sustained damages to her automobile as the
result of an accident in 2000. She acknowledged that Commerce paid to
have the physical damage to her car fully and properly repaired. In
addition to the repair of her car, however, Ms. Given sought recovery
from Commerce for the inherent diminished value of her automobile as a
result of the accident, which she argued was the difference between
the market value of her automobile immediately before the accident and
the market value after the full repairs. The Supreme Judicial Court
rejected Ms. Given's claim and decided in favor of Commerce, stating
in its decision that,
"Having paid for the full cost of repairing the vehicle,
Commerce was not obligated to pay anything more under any
theory."
The Court's decision is based on its interpretation of the
Massachusetts Standard Auto Policy, which is determined and controlled
by the Massachusetts Division of Insurance and required to be used by
all insurers operating in the Commonwealth.
About The Commerce Group, Inc.
The Commerce Group, Inc. is headquartered in Webster, Massachusetts.
Property and casualty insurance subsidiaries include The Commerce
Insurance Company and Citation Insurance Company in Massachusetts,
Commerce West Insurance Company in California and American Commerce
Insurance Company in Ohio.
Through its subsidiaries' combined insurance activities, the Company
is ranked as the 22nd largest personal automobile insurance group in
the country by A.M. Best, based on the most recently available direct
written premium information.
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Page 2
Forward Looking Statements
This press release contains some statements that are not historical
facts and are considered "forward-looking statements" as defined in
the Private Securities Litigation Reform Act of 1995. Such forward-
looking statements involve opinions, assumptions and predictions, and
no assurance can be given that the future results will be achieved
since events or results may differ materially as a result of risks
facing the Company. These include, but are not limited to, those risks
and uncertainties in the Company's business, some of which are beyond
the control of the Company, that are described in the Company's
recently filed registration statement on Form S-3, its Forms 10-K and
10-Q, and other documents filed with the SEC, including the
possibility of adverse catastrophe experience and severe weather,
adverse trends in claim severity or frequency, adverse state and
federal regulation and legislation, adverse state judicial decisions,
litigation risks, interest rate risk, rate making decisions for
private passenger automobile policies in Massachusetts, potential rate
filings outside of Massachusetts, heightened competition,
concentration of business within Massachusetts, dependence on certain
principal employees, as well as the economic, market or regulatory
conditions and risks associated with entry into new markets and
diversification. The Commerce Group, Inc. is not under any obligation
to (and expressly disclaims any such obligations to) update or alter
its forward-looking statements, whether as a result of new
information, future events or otherwise.
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