For Immediate Release - October 26, 2010

Over 9,000 Refunds Being Sent to Motorcycle Riders in Norfolk & Plymouth Counties Under AG Coakley's Motorcycle Insurance Settlements

Riders in Norfolk & Plymouth Counties Receiving Over $3.1 Million in Refunds

BOSTON - Attorney General Martha Coakley announced today that six insurance companies- Arbella Mutual, Metropolitan P&C, Plymouth Rock Assurance, Pilgrim Insurance, Hanover Insurance and Norfolk & Dedham (N&D)- just completed the process of sending more than $17.5 million to motorcycle owners throughout the Commonwealth who are eligible for refunds under settlements that the Attorney General's Office reached with the insurers earlier this year. The settlements relate to allegations that the insurers overcharged tens-of-thousands Massachusetts motorcyclists by using inflated motorcycle values to calculate insurance premiums. The settlements are part of an industry-wide investigation that the Attorney General's Office began in the fall of 2008 after receiving a complaint from the owner of a Harley-Davidson. To date, that investigation has required twelve insurance companies to return more than $33.8 million to Massachusetts motorcycle riders.

Of the $17.5 million that is currently being returned by Arbella, Metropolitan, Plymouth Rock, Pilgrim, Hanover and N&D, motorcycle owners in Norfolk and Plymouth counties will receive over $3.1 million with refunds averaging $321.86. Specifically, in Norfolk and Plymouth counties there are 9,906 refunds of which:

  • 676 are between $1,000 and $6,332
  • 1,315 are between $500 and $999
  • 4.191 are between $100 and $499
  • 3,724 are refunds under $100

In order to be eligible for a refund under the Attorney General's settlements, a consumer must have purchased comprehensive and/or collision insurance coverage for a motorcycle on or after January 1, 2002 and that motorcycle must have been overvalued by the insurance company for the purposes of calculating premiums. Consumers who think they may be entitled to a refund can use the Attorney General's Motorcycle Insurance Refund Lookup Webpage at www.motorcycle.ago.state.ma.us to find out whether they are eligible, and if so, how much they're entitled to receive. Consumers who have questions about the settlement or their refund may visit the Attorney General's webpage about the motorcycle insurance settlements or call the Attorney General's Insurance & Financial Services Division at 1-888-830-6277.

The Attorney General's Insurance & Financial Services Division began its investigation into motorcycle rating practices in the fall of 2008 after receiving a complaint from a consumer about the way Safety Insurance Company had valued a 1999 Harley-Davidson Road King Classic. In each year between 2003 and 2008, the Attorney General's Office found that Safety Insurance Company had charged the consumer premiums as if the1999 Road King Classic were worth $20,000. However, by 2008, the motorcycle was nine-years-old and worth less than $12,000. As a result, Safety Insurance Company overcharged the consumer by more than $1,500. The Attorney General's investigation ultimately found that many of the insurance companies operating in Massachusetts between 2002 and 2009 had used inflated motorcycle book values to calculate premiums for their customers and that tens of thousands of Massachusetts residents had been affected by the resulting overcharges.

To date, the Attorney General's Office has reached settlements with Safety Insurance, Liberty Mutual, Plymouth Rock Assurance, Pilgrim Insurance Company, Metropolitan Property & Casualty, USAA, Arbella, Hanover Insurance, OneBeacon, National Grange, Norfolk & Dedham, and Quincy Mutual to resolve similar allegations. In total, the dozen insurance companies that have settled are expected to return over $33.8 million on nearly 100,000 policies and pay over $1.5 million to the Commonwealth. A number of other insurance companies remain under investigation.

More information about the settlements, including a link to the Attorney General's Motorcycle Insurance Refund Lookup Webpage is available at www.mass.gov/ago/motorcycles.

These cases are being handled by Investigations Supervisor Arwen Thoman, Mathematician Burt Feinberg and Economist Bryan Lincoln-all of the Attorney General's Insurance & Financial Services Division, and also Glenn Kaplan, Chief of the Insurance & Financial Services Division. The original consumer complaint was handled by Rebecca Dutra, a Mediator in the Attorney General's Insurance & Financial Services Division.

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