Auto insurer expands in western New York

Executives from GEICO Corp. and Gov. David A. Paterson on Wednesday said the giant auto insurer will bring at least 300 new jobs to western New York and invest $2.4 million over three years as it expands its service center in Amherst, near Buffalo.

The Washington, D.C.-based insurer, the third-largest auto carrier in the country and largest in the state, is opening a second location for its fast-growing GEICO Insurance Agency subsidiary, which sells, services and underwrites other lines of personal insurance for consumers on behalf of other insurers.

The agency, run by John Zinno, former head of the Amherst service center, is currently based in Fredericksburg, Va., where it employs more than 850. But it has outgrown that location, and will use the extra space at Geico's facility in CrossPoint Business Park to accommodate future growth.

The new jobs represent a 20 percent increase from the 1,500 currently employed there.

"We are pleased that is happening and that one of the most identifiable brands in the nation is investing in western New York," Paterson said during a news conference, with GEICO's well-known gecko mascot in the room.

In exchange, the site has been designated as a "regionally significant" project under the Empire Zone program, and GEICO will receive $1.5 million in tax credits over the next five years through the towns of Tonawanda and Amherst.

It will also get a sales tax exemption from the Amherst Industrial Development Agency for equipment purchases and 1.6 megawatts of low-cost hydropower from the New York PowerAuthority, valued at $1.75 million in savings. The Workforce Investment Boards in Erie and Niagara counties also will provide workforce training assistance.

Paterson and GEICO officials said the company would begin taking job applications immediately for the agency, which sells and services homeowners, renters, boat and other types of personal insurance except auto. "The first hiring is at high noon. We're not wasting any time," the governor said.

The 300 jobs to be created during the next three years may grow. Officials said the agency operation could employ as many as 1,000 over 10 years, bringing total employment for GEICO locally to about 2,500.

That was the ultimate goal cited by GEICO for Amherst when it first announced plans in December 2003 to set up shop in western New York. And it has been stated as the capacity of the existing building, although GEICO's CEO, Tony Nicely, said some people have suggested it could even hold more.

The facility now handles sales, service, underwriting and claims for GEICO auto insurance customers in New Jersey and New England.

Currently, the second floor, while finished, is largely vacant. "Look at all the empty space. We look (forward) to seeing it full," Nicely said.

This is the latest major coup in western New York for Paterson and state economic development officials, coming on the heels of Internet search engine Yahoo's announcement in June that it would build a major data center in Lockport.

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