PETITION OF:

SECTION 1. Section 9 of chapter 16 of the General Laws, as appearing in the 2004 Official Edition, is hereby amended by inserting after the fifth sentence the following sentence:- In addition, the registrar shall be responsible for approving driver training courses, including a behind-the-wheel driver training course and an advanced driver training course.

SECTION 2. Chapter 29 of the General Laws is hereby amended by adding the following sections:-

Section 2OOO. (a) There is hereby established and set up on the books of the commonwealth a separate fund to be known as the Municipal Police Insurance Loss Control Fund consisting of revenues deposited into the fund by insurance companies that write private passenger automobile insurance in the commonwealth. Such companies shall contribute a total of $1,050,000 to the Municipal Police Insurance Loss Control Fund by the end of each calendar year based on their pro rata share of exposures written in this state as of the most recent calendar year. These costs shall not be passed on to the insureds and shall not be used in any data to establish rates under any of the private passenger automobile insurance laws.

(b) These funds shall be deposited into said fund to be expended by the commissioner of insurance. They shall not be subject to fringe or indirect costs. The funds shall be distributed without further appropriation by March 15th of each year in equal amounts of $150,000 to the municipal police departments in the 7 cities in which automobile insurance fraud is at the greatest levels according to the data reported to the Insurance Fraud Bureau of Massachusetts. For the first year, the funds shall be distributed to the police departments of Springfield, Lawrence, Brockton, Lynn, Revere, Chelsea and Boston. The fund recipients shall use such funds exclusively to fight automobile insurance fraud in consultation with the Community Insurance Fraud Initiative of the Insurance Fraud Bureau of Massachusetts. In order to receive a grant of such funds for subsequent years, the police departments will be required to prepare a report of their efforts identifying all actions that they have made in this regard including the number of arrests, descriptions of the facts underlying the arrests and the number of prosecutions and convictions in this regard in addition to specific actions that they propose to take in the subsequent year. These reports shall be submitted to the commissioner and the Insurance Fraud Bureau no later than December 31st of each year. Based on the success of the police departments' respective fraud fighting efforts, their proposals for fighting fraud in the subsequent year and the statistical need for assistance in high fraud areas, the commissioner will decide, in consultation with the Insurance Fraud Bureau, not later than March 1st of each year as to which police departments will receive the funding for that year.

(c) The funds that the police departments receive in connection with this program shall be used solely to fight automobile insurance fraud. Any funds not expended by the police departments within 12 months of their receipt shall be returned to the commissioner who shall keep the funds in a separate account. These funds shall be made available on a pro rata basis to the police departments selected to receive funding during the next calendar year in accordance with this section.

Section 2PPP. (a) There is hereby established and set up on the books of the commonwealth a separate fund to be known as the District Attorney Insurance Loss Control Fund consisting of revenues deposited into the fund by insurance companies that write private passenger automobile insurance in the commonwealth. Such companies shall contribute a total of $900,000 to the District Attorney Insurance Loss Control Fund by the end of each calendar year based on their pro rata share of exposures written in this state as of the most recent calendar year. These costs shall not be passed on to the insureds and shall not be used in any data to establish rates under any of the private passenger automobile insurance laws.

(b) These funds shall be deposited into said fund to be expended by the commissioner of insurance. They shall not be subject to fringe or indirect costs. The funds shall be distributed without further appropriation by March 15th of each year in equal amounts of $150,000 to the office of the district attorney in the 6 counties in which automobile insurance fraud is at the greatest levels according to the data reported to the Insurance Fraud Bureau of Massachusetts. For the first year, the funds shall be distributed to the office of the district attorney in the counties of Essex, Middlesex, Hamden, Suffolk, Norfolk and Plymouth. The fund recipients shall use such funds exclusively to fight automobile insurance fraud in consultation with the Community Insurance Fraud Initiative of the Insurance Fraud Bureau of Massachusetts. In order to receive a grant of such funds for subsequent years, the office of the district attorney is required to prepare a report of their efforts identifying all actions that they have made in this regard including the number of arrests, descriptions of the facts underlying the arrests and the number of prosecutions and convictions in this regard in addition to specific actions that they propose to take in the subsequent year. These reports shall be submitted to the commissioner and the Insurance Fraud Bureau no later than December 31st of each year. Based on the district attorney's past success fighting fraud, their proposals for fighting fraud in the subsequent year and the statistical need for assistance in high fraud areas, the commissioner will decide, in consultation with the Insurance Fraud Bureau, not later than March 1st of each year as to which district attorney's offices will receive the funding for that year.

(c) The funds that the district attorneys receive in connection with this program shall be used solely to fight automobile insurance fraud. Any funds not expended by the district attorneys within 12 months of their receipt shall be returned to the commissioner who shall keep the funds in a separate account. These funds shall be made available on a pro rata basis to the office of the district attorney selected to receive funding during the next calendar year in accordance with this section.

SECTION 3. Section 1 of chapter 90 of the General Laws, as appearing in the 2004 Official Edition, is hereby amended by striking out, in line 341, the words "under five years of age".

SECTION 4. Section 7AA of chapter 90, as so appearing, is hereby amended by striking out in lines 1 and 2, the words "under age five and no child weighing forty pounds or less" and inserting in place thereof the following words:- weighing less than 60 pounds.

SECTION 5. Said section 7AA of said chapter 90, as so appearing, is hereby further amended by striking out, in line 6, the words "five years of age or older" and inserting in place thereof the following words:- 60 pounds or over.

SECTION 6. Said section 7AA of said chapter 90, as so appearing, is hereby further amended by striking out twice, in line 22, the word "twenty-five" and inserting in place thereof the following figure:- 150.

SECTION 7. Section 22F of chapter 90, as so appearing, is hereby amended by adding the following paragraph:-

Notwithstanding any other provision of this section, upon receiving notification from the merit rating board that a driver has had 5 motor vehicle violations and/or at fault accidents within the past 3 years, the registrar shall require the driver to participate in and complete a driver education program satisfactory to the registrar. A driver ordered to complete such a program may appeal the order to the registrar. Such appeal shall be limited to the accuracy of the merit rating board's records. If such driver fails to provide to the registrar proof of completion of such driver education program within 90 days after the registrar mails to the driver notice of such requirement, the registrar shall suspend the driver's license or right to operate a motor vehicle until the registrar receives proof of completion of such driver education program.

SECTION 8. Section 34A of chapter 90, as so appearing, is hereby amended by striking out, in lines 44 and 87, the words "other than" and inserting in place thereof the following word:- including.

SECTION 9. Said section 34A of chapter 90, as so appearing, is hereby further amended by striking out, in lines 49 and 50 and 92 and 93, the word "commonwealth" and inserting in place thereof the following words:- United States or Canada.

SECTION 10. Said section 34A of chapter 90, as so appearing, is hereby further amended by striking out, lines 122 through 243, inclusive.

SECTION 11. Chapter 90 is hereby amended by striking out section 34M, as so appearing, and inserting in place thereof the following section:-

Section 34M. (a) Every motor vehicle liability policy and every motor vehicle liability bond, as defined in section 34A of this chapter, issued or executed in this commonwealth shall provide personal injury protection benefits as set forth in this section except to the extent such defined benefits may be modified, reduced or eliminated by the purchase of the deductible authorized in this section.

(b) The following classes of persons shall be eligible to receive personal injury protection payments:

(1) the named insured or obligor on a motor vehicle liability policy or bond, respectively;

(2) members of the insured's or obligor's household;

(3) any authorized operator of or passenger in the insured's or obligor's motor vehicle;

(4) any pedestrian, including persons operating bicycles, tricycles and similar vehicles, persons on horseback or in vehicles drawn by horses or other draft animals, who is struck by the insured's or obligor's motor vehicle; and

(5) insureds, obligors and members of their households if injured while in, upon, entering into or alighting from a motor vehicle that does not include personal injury protection, or struck while a pedestrian by such a vehicle; provided that persons who recover through a tort action the losses and expenses resulting from the motor vehicle accident shall not be eligible for payments under this subsection.

(c) Notwithstanding subsection (b), an insurer may deny personal injury protection benefits to a person if he, while operating a motor vehicle in the commonwealth, contributed to his injury in any of the following ways:

(1) operating under the influence of alcohol or a controlled substance as defined in section 1 of chapter 94C or the vapors of glue;

(2) while committing a felony or seeking to avoid lawful apprehension or arrest by a police officer; or

(3) by acting with specific intent to cause injury or damage to himself or others.

(d) Payments shall be made only for losses and expenses incurred by accident, and not suffered intentionally, while in or upon, or entering into or alighting from, or being struck as a pedestrian by the insured's or obligor's motor vehicle, without regard to negligence or gross negligence or fault of any kind.

(e) The total limit amounts paid under personal injury protection coverage on account of injury to or death of any one person shall be at least $8,000; provided that personal injury protection coverage shall pay no more than $2,000 to an injured person in health care services as defined in subsection (h) if such services provided to the injured person as a result of a motor vehicle accident are, or will be, compensated, paid or indemnified pursuant to any policy of health, sickness or disability insurance or any group contract or agreement to provide, pay for or reimburse the injured person for health care services.

(f) No payments shall be made if the injured person is entitled to payments or benefits under chapter 152.

(g) No payments shall be made to anyone who, at the time of the accident, was operating or occupying a motorcycle, and any motor vehicle not subject to motor vehicle registration, or a motorized bicycle, including a moped.

(h) Payments for personal injury protection coverage pursuant to section 34S of this chapter shall be made to or for the benefit of injured persons to cover losses and expenses that fall within the following categories:

(1) Health care services, consisting of reasonable expenses incurred within 2 years from the date of the accident for necessary medical, surgical, diagnostic and dental services, including prosthetic devices and necessary ambulance, hospital, professional nursing and funeral services;

(2) Lost income, consisting of (i) income actually lost by persons employed or self-employed at the time of the accident, because of the inability to work and earn compensation, in the form of wages, salary, or their equivalent, but not other income that would otherwise have been earned in the normal course of the person's employment, such as bonuses or profit sharing; provided that the payments for such lost compensation shall be limited to an amount that will provide 75 per cent of the person's average weekly compensation for the year immediately preceding the accident, or (ii) the actual amount of diminution of earning power for persons who are not employed or self-employed at the time of the accident; and

(3) Household services, including reasonable amounts actually paid to others, not members of the injured person's household, for providing ordinary and necessary services that the injured person would otherwise have performed, not for income but for the benefit of himself or members of his household.

(i) No health, sickness or disability insurance policy, and no contract or agreement of any entity to provide, pay for or reimburse the cost of health care services shall deny claims relating to injuries suffered in a motor vehicle accident on the grounds that the injured person has personal injury protection coverage.

(ii) Notwithstanding the provisions of section 70A of chapter 111, an entity that has provided, paid for, or reimbursed and injured person for health care services shall not recover any amount against the injured person, shall not be subrogated to the rights of the injured person for more than $2,000 of personal injury protection benefits, and shall not have a lien against the injured person's personal injury protection benefits on account of its provisions, payment, or reimbursement of health care service.

(k) Within 2 years of the accident the insurer providing the personal injury protection coverage may, if the injured person receiving benefits has any insurance policy that provides health benefits or disability income coverage and the injured person is unable or refuses to pay the cost of renewing or maintaining such policies in force, tender to the injured person the cost of renewing or maintaining such policy in force for the 2 year period. An injured person who receives such tender shall continue the existing policy of insurance or equivalent policy in force for the 2 year period. Prior to the receipt of such tender, the injured person shall not be compelled to renew or maintain in force any policy of insurance. The tender of the cost of renewing or maintaining insurance shall not interfere with the claimant's choice of physician or medical treatment.

(l) Payments under personal injury protection coverage for lost income, whether in the form of wages, salary, or their equivalent, to persons who are entitled to compensation under any income continuation program applicable to periods of inability to work, shall be coordinated with benefits payable under such program to ensure that the total amount payable under both programs is no more than 75 per cent of the person's average weekly compensation for the year immediately preceding the accident.

(1) The motor vehicle insurer shall reimburse those income continuation programs which provide for accumulated benefits which can be converted into cash or additional retirement credit for the amount the program actually pays to the injured person: said reimbursements shall not exceed 75 per cent of the injured person's average weekly compensation for the year immediately preceding the accident.

(2) An injured person who receives compensation under a wage continuation program and also recovers these benefits from another source shall be entitled to reimburse the wage continuation program with no loss of standing under such program.

(3) If payments to an injured person under any program for wage continuation reduce the amounts paid under personal injury protection for lost income, and the benefits under that program are subsequently exhausted, rendering the injured person unable to receive wage compensation for a later injury or illness, lost income, in an amount equal to the reduction in the payments previously made to the injured person, shall be treated as lost income resulting from the injury for which the personal injury protection payments were made, if the loss is incurred within 1 year after the receipt of the last benefit provided under personal injury protection coverage.

(m) A person injured in a motor vehicle accident who may be eligible for payment of personal injury protection benefits shall provide prompt notice to the insurer of any accident that may form the basis of a claim. Such notice shall be given within 5 days after the accident. This time limitation shall apply unless the injured person or that person's representative submits written proof providing clear and reasonable justification for the failure to comply with such time limitation.

(n) Within 15 days after an insurer’s receipt of notice of an accident by a claimant under this section, the insurer shall furnish such forms as are usually furnished by it for filing proofs of claims.

(o) The personal injury protection benefits due and payable under any motor vehicle liability policy or bond as a result of the provisions therein providing personal injury protection benefits, and any benefits due any person entitled to make claim under the assigned claims plan established in accordance with section 34N of this chapter, are granted in lieu of damages otherwise recoverable by the injured person or persons in tort as a result of an accident occurring within the commonwealth.

(p) Every owner, registrant, operator or occupant of a motor vehicle to which personal injury protection benefits apply who would otherwise be liable in tort, and any person or organization legally responsible for his acts or omissions, is hereby made exempt from tort liability for damages because of bodily injury, sickness, disease or death arising out of the ownership, operation, maintenance or use of such motor vehicle to the extent that the injured party is, or would be had he or someone for him not purchased a deductible authorized by this section, entitled to recover under those provisions of a motor vehicle liability policy or bond that provide personal injury protection benefits or from the insurer assigned. No such exemption from tort liability shall apply in the case of an accident occurring outside the commonwealth. However, if any person claiming or entitled to benefits under the personal injury protection provisions of a policy or bond insuring a vehicle registered in the commonwealth brings, in such a case, an action in tort against the owner or person responsible for the operation of such a vehicle, amounts otherwise due such a person under the provisions of this section shall not become due and payable until a settlement is reached or a final judgment is rendered in such a case and the amounts then due shall be reduced to that extent that damages for expenses and loss otherwise recoverable as a personal injury protection benefits are included in any such settlement or judgment.

(q) Non-cooperation of an injured party or failure to timely provide required notices or proofs of claim under this section or section 34S of this chapter shall be a defense to the insurer in any suit for benefits authorized by this section and failure of an insurer to pay benefits in the event of such non-cooperation shall not in any way affect the exemption from tort liability granted herein.

(r) Any insurer paying benefits in accordance with the provisions of this section shall be subrogated to that extent to the rights of any party it pays and may bring an action in tort against any person liable for such damages in tort who is not exempt from said liability as a result of the provisions of this section; provided, however, that no insurer shall reduce or limit the amount of liability insurance otherwise available to an injured person as a result of such subrogation. Said insurer is also hereby given the right to make claim for all expenses it incurs on account of such payments, including the net amount of benefits paid, costs of processing claims for any such benefits, and the expenses of enforcing this right, against any other insurer providing a motor vehicle liability policy or bond on a motor vehicle registered in the commonwealth, whose owner or operator would, except for the exemption from tort liability provided in this section, be liable for such damages in tort. Determination as to whether any insurer is legally entitled to recover any such expense from another insurer shall be made by agreement between the involved insurers, or, if they fail to agree, by arbitration.

(s) Each insurer providing personal injury protection shall issue to any person purchasing a motor vehicle liability policy or bond, at his option, a policy endorsement, approved as to content by the commissioner of insurance, which shall provide that there shall be deducted from amounts that would otherwise be or become due to the policy- holder alone or to the policyholder and members of his household, as the policyholder elects, an amount of either $100, $250, $500, $1,000, $2,000, $4,000 or $8,000, again as the policyholder elects, said amount to be deducted from the amounts otherwise due each person subject to the deduction. Any person electing such an endorsement or subject to such an endorsement as a result of the policyholder's election shall have no right to claim or to recover any amount so deducted from any owner, registrant, operator or occupant of a motor vehicle or any person or organization legally responsible for any such owner's, registrant's, operator's or occupant's acts or omissions who is made exempt from tort liability by this section. Amounts deducted from payment in accordance with the provisions of this subsection shall not have any effect upon the determination of whether or not the reasonable and necessary expenses incurred as a result of any injury exceed or do not exceed $500, which determination may affect an injured person's right under section 6D of chapter 231.

(t) Personal injury protection benefits and benefits due from an insurer assigned shall be due and payable in accordance with section 34S of this chapter, provided, however, that an insurer may agree to a lump sum discharging all future liability for such benefits on its own behalf and on behalf of the insured or obligor. With respect to such benefits, and to medical coverage contained in section 113C of chapter 175, no insurer shall refuse to pay a bill for medical services submitted by a practitioner registered or licensed under the provisions of chapter 112, if such refusal is based solely on a medical review of the bill or of the medical services underlying the bill, which review was requested or conducted by the insurer, unless the insurer has submitted, for medical review, such bill or claim to at least one practitioner registered or licensed under the same section of chapter 112 as the practitioner who submitted the bill for medical services.

(u) The commissioner of insurance may promulgate rules and regulations implementing the provisions of this section, including coordination of benefits provided for in this section, section 34S, and section 113C of chapter 175.

SECTION 12. Section 34N of chapter 90, as so appearing, is hereby amended by striking out, in line 17, the words "thirty-four A" and inserting in place thereof the following figure:- 34M.

SECTION 13. Chapter 90 of the General Laws, is hereby amended by adding the following section:-

Section 34S. (a) All health care benefits provided under compulsory motor vehicle insurance coverages, including bodily injury liability and personal injury protection as defined in sections 34A and 34M of this chapter, respectively, and uninsured motorist as defined in section 113L of chapter 175 shall be made in accordance with this section.

(b) The rate of payment by insurers for such health care benefits shall not exceed the rates established by the division of health care finance and policy pursuant to section 13 of chapter 152; provided, however, that a different rate may be agreed upon between the insurer and the health care provider.

(c) The total number of treatments for services not provided by or under the direct supervision of a medical doctor licensed under section 2 of chapter 112 or a dentist licensed under section 45 of chapter 112, including but not limited to treatments by acupuncturists, massage therapists, physical therapists, physical therapists assistants and chiropractors are limited to an aggregate of 10 visits per injured person, per accident; provided, however, that any additional such treatments may be covered by endorsement subject to additional charge. This limitation shall not apply to necessary hospital, surgical, dental, prosthetic, ambulance, diagnostic, professional nursing services or funeral services.

(d) Notwithstanding section 108 of chapter 175, in the case of a claim for health care benefits, the claimant or that person's assignee or representative shall submit a written proof of claim to the insurer, including full particulars of the nature and extent of the injuries and treatment received and contemplated, as soon as reasonably practicable but, in no event later than 45 days after the date services are rendered. This time limitation for the submission of the proof of claim shall apply unless the claimant or that person's representative submits written proof providing clear and reasonable justification for the failure to comply with such time limitation.

(e) Within 45 days from said receipt of proof of claim if payment is not made, the insurer shall notify the claimant in writing specifying the reasons for the nonpayment or whatever future documentation is necessary for payment of the claim within the terms of the policy. If the insurer fails to comply with the provisions of this paragraph, the insurer shall pay, in addition to any benefits, which inure to such claimant or provider, interest on such benefits, which shall accrue beginning 45 days after the insurer's receipt of the proof of claim at the rate of 1 1/2 per cent per month, not to exceed 18 per cent per year. The provisions of this paragraph relating to interest payments shall not apply to a claim that an insurer is investigating in good faith and in a reasonably prompt manner because of suspected fraud.

(f) Upon request by the insurer, a claimant or that person's assignee or representative shall:

(1) execute a written proof of claim under oath;

(2) as may reasonably be required submit to examinations under oath by any person named by the insurer and subscribe the same;

(3) provide authorization that will enable the insurer to obtain medical records; and

(4) provide any other pertinent information that may assist the insurer in determining the amount due and payable.

(g) Notwithstanding the provisions of section 6D of chapter 231, a claimant for health care service or wage loss expenses shall submit to medical examination by physicians selected by, or acceptable to, the insurer, when, and as often as, the insurer may reasonably require.

(h) Any insurer may enter into a preferred provider arrangement in compliance with the requirements of chapter 176I; provided, however, that the utilization review systems of a carrier with a preferred provider arrangement shall not be subject to review under the requirements of chapter 1761 or chapter 1760. Notwithstanding any other provision of this chapter, if an insurer enters into a preferred provider arrangement for health care services required under this chapter, those individuals who are subject to the arrangement shall receive such care in the manner prescribed by the arrangement; provided, however, that an individual may receive immediate emergency treatment from a health care provider who is not a member of the managed care organization, and the insurer shall pay the reason- able and necessary costs of such treatment.

SECTION 14. Chapter 175 of the General Laws is hereby amended by striking out section 4C, as so appearing, and inserting in place thereof the following section:-

Section 4C. No insurer licensed to write and engaged in the writing of homeowners and automobile insurance in this commonwealth nor the joint underwriting association, formed pursuant to the provisions of chapter 175C or the assigned risk plans, formed pursuant to the provisions of sections 113H and 113W of chapter 175, shall take into consideration when deciding whether to provide, renew, or cancel such insurance the race, color, religious creed, national origin, sex, age, ancestry, sexual orientation, children, marital status, veteran status, the receipt of public assistance or disability of the applicant or insured. Nothing herein shall preempt any existing remedy provided by law for any action that constitutes a violation of this section.

SECTION 15. Chapter 175 of the General Laws is hereby amended by inserting after section 4C, the following section:-

Section 4C½. Consumer protections pertaining to the use of credit.

Credit Information, means any credit related information whether obtained as a credit history, a credit report, a consumer report, a credit score, an insurance score or any other compilation or collection of a person's credit. Credit information may not be use as a rating factor in the calculation of premiums for private passenger automobile insurance.

SECTION 16. Section 22C of chapter 175, as so appearing, is hereby amended by striking out, in line 31, the words "upon demand, refund within thirty days all money due to the insured as the result of such cancellation" and inserting in place thereof the following words:- refund all money due to the insured as a result of such cancellation as required under section 11 3A of chapter 175.

SECTION 17. Section 108D of chapter 175, as so appearing, is hereby amended by striking out, in line 1, the word "Whenever" and inserting in place thereof the following words:- Except as provided by subsection (b) of section 34S of chapter 90, whenever.

SECTION 18. Section 113A of chapter 175, as so appearing, is hereby amended by striking out the 15th paragraph and inserting in place thereof the following paragraph:-

The insured shall have the option to purchase and the insurer shall not refuse to issue an annual motor vehicle policy or bond providing coverages in accordance with this chapter and chapter ninety con- taming any expiration date as the insured may elect. Insurers may offer such policies or bonds for a minimum period of 6 months but not more than two years or may issue an extension of any existing policy or bond.

SECTION 19. Section 113B of chapter 175 is hereby repealed.

SECTION 20. Chapter 175 is hereby amended by striking out section 113H, as appearing in the 2004 Official Edition, and inserting in place thereof the following section:-

Section 113H. Except as otherwise provided in subsection (c), the following provisions shall not apply to the residual market for private passenger automobile insurance.

(a) Insurance companies undertaking to issue motor vehicle liability policies or bonds, except for private passenger automobile policies and bonds, both as defined in section 34A of chapter 90, shall cooperate in the preparation and submission of a plan which shall provide motor vehicle insurance to applicants for such policies and bonds who have been unable to obtain insurance through the method by which insurance is voluntarily made available; except that the plan shall provide that no insurance company shall be required to issue such policy or execute such bond if:

(1) The applicant or any person who usually drives the motor vehicle has failed to pay an insurance company any motor vehicle insurance premiums due or contracted during the preceding 12 months; or

(2) Any person who usually drives the motor vehicle is unlicensed.

(b) Such plan shall provide for the fair and equitable apportionment among such insurance companies of premiums, losses or expenses, or any combination thereof. Such a plan shall provide that at least the following coverages shall be made available:

(1) bodily injury liability and property damage liability coverage in at least the minimum amounts required by law;

(2) personal injury protection;

(3) medical payments coverage, to a limit of at least $5,000;

(4) increased limits of bodily injury liability coverage in an amount to bring the total bodily injury liability coverage available for any 1 accident to $250,000 per person and $500,000 per accident;

(5) increased property damage liability limits in an amount to bring the total property damage liability coverage available for any one accident to $50,000;

(6) uninsured motorist limits in an amount up to the bodily injury liability limits of the policy;

(7) physical damage insurance, which shall mean: (A) collision coverage or limited collision coverage, (B) fire and theft coverage, or (C) comprehensive coverage, so-called, as those coverages are defined in sections 34A and 340 of chapter 90 and sections 1130. The plan shall permit the refusal of collision, fire, theft or comprehensive coverage or the charging of rates at the discretion of the insurer, under the following circumstances:

(i) comprehensive, fire and theft or collision coverage on a vehicle customarily driven by or owned by persons convicted within the most recent 5 year period of any category of vehicular homicide, auto insurance related fraud, or motor vehicle theft;

(ii) comprehensive, fire and theft or collision coverage on a vehicle customarily driven by or owned by persons who have, within the most recent 5 year period, made an intentional and material misrepresentation in making claim under such coverages;

(iii) collision coverage on a vehicle customarily driven by or owned by persons who have been involved in 4 or more accidents in which such person has been deemed to be at fault in excess of 50 per cent within the 3 years immediately preceding the effective date of the policy;

(iv) comprehensive or fire and theft coverages on a vehicle customarily driven by or owned by persons who have had 2 or more total theft or fire claims within the 3 years immediately preceding the effective date of the policy;

(v) comprehensive, fire and theft or collision coverage on a vehicle customarily driven, or owned by persons convicted I time within the most recent 3 year period of any category of driving while under the influence of alcohol, drugs or the vapors from glue;

(vi) comprehensive, fire and theft or collision coverage on any motor vehicle for which a salvage title has been issued by the registrar of motor vehicles unless a new certificate of title has been issued pursuant to section 20D of chapter 90D; or

(vii) comprehensive, fire and theft or collision coverage on a high-theft vehicle which does not have at least a minimum anti-theft or auto recovery device as prescribed by the commissioner of insurance. The commissioner may designate as a "high-theft vehicle" any vehicle, classified according to make, model and year of manufacture, which has both above-average incidence of theft and above-average original sale price, and may prescribe appropriate anti-theft or auto recovery devices for such vehicles.

(c)(1) Such a plan and the plan for the private passenger automobile residual market established pursuant to section 113W of chapter 175 shall be prepared and administered by a single governing committee consisting of 13 members appointed by the commissioner for terms of 6 years. Six of the members shall be appointed from the insurance companies participating in the plan and 1 member shall be appointed from an insurance company, which, based on data avail- able as of December 31 of the most recent calendar year, writes less than 2.5 per cent of the annual statewide reported property damage liability exposures, who is unaffiliated with any other insurance company; and 6 members shall be appointed who are insurance producers. The provisions of this section shall not be construed so as to alter or amend the terms of the present governing members. The governing committee shall be responsible for the hiring of the employees of the plan.

(2) In the event that a company represented on the committee decreases its book of automobile business in the commonwealth by more than 10 per cent from the previous calendar year, as determined by the commissioner, the member representing such company shall cease to be a member of the committee and a new company and a member thereof shall be appointed as prescribed herein. Not more than 1 member from any 1 insurance group under the same management shall serve on the committee at the same time.

(d) The plan shall provide that every licensed producer shall be assigned to at least 1 servicing carrier; except that the governing committee shall not be required to make any such assignment if, subject to reasonable standards adopted by the governing committee:

(1) the producer has been convicted of a dishonest act related to his occupation as an insurance producer;

(2) the producer's license to engage as an insurance producer has been revoked;

(3) there has been a material and substantial breach of a contract between a servicing carrier and a producer by a producer; or

(4) the producer has an uncured default in remittance of any premiums due the servicing carrier.

(e) The plan shall permit the appointment and participation of a reasonable number of servicing carriers and the plan shall establish reasonable eligibility requirements for appointment as a servicing carrier, including but not limited to, the maintenance of a specific investigation unit to investigate suspicious or questionable motor vehicle insurance claims for the purpose of eliminating fraud. Not more than 1 insurer in a group under the same management shall serve as a servicing carrier at the same time. The plan shall provide a specific investigative unit to monitor the effectiveness of servicing carrier fraud control efforts. No domestic insurance company shall be denied participation as a servicing carrier based solely upon its share of the Massachusetts motor vehicle insurance market.

(f) The governing committee shall on or before March 31, 2007 and thereafter not later than 2 years after such standards were most recently approved, prepare performance standards for the handling and payment of claims by the servicing carriers. Such standards shall be designed to ensure the speedy settlement of valid claims at the lowest reasonable cost and the denial of fraudulent or otherwise invalid claims. Such performance standards shall be submitted to the commissioner of insurance who, after a public hearing, shall approve or modify such performance standards. The plan shall collect and maintain data on compliance with the performance standards by servicing carriers. Such information shall be reported annually to the commissioner of insurance and may be the basis for adjustment to premiums.

(g) No insurer acting as a servicing carrier of the plan, or their employees or producers, no member company, employee or producer, or any employee of the plan or any official or officer of any law enforcement agency, shall be subject to civil or criminal liability in a cause of action of any kind for furnishing any evidence of information to any specific investigation unit created pursuant to this section, its employees or any law enforcement agency or any other insurer relating to an investigation conducted involving losses under liability or physical damage coverages for motor vehicles.

(h) Changes of assignment of servicing carriers, for reasonable business purposes, may be made upon application to and approval by the governing committee, provided there is not a significant disruption of the marketplace and no unfair or inequitable apportionment of premiums, losses or expenses.

(i) The plan shall include guidelines for the installment payment plans to be provided by the servicing carriers.

(j) To control the size of the population of the plan, the plan shall annually provide for territorial and classification credits for those companies voluntarily writing private passenger automobile insurance within those territories and classifications that would otherwise be disproportionately represented in the plan. The size of the credits shall be such as to enhance the purpose that no classification or territory is disproportionately represented in the plan.

(k) All policies insured through the plan shall be rated in accordance with the manual of classifications, rules and rates, and rating plans filed by or on behalf of the plan under the provisions of chapter 175A. The statistical data previously and hereafter recorded under this section for risks insured through the plan shall be given due consideration in developing the rates for such risks.

(l) The premium charges filed by or on behalf of the plan may provide that such premium charges for any risk insured in the plan will exceed the premium charges that would be used by each risk's servicing carrier for that risk if such risk were not insured in the plan, provided, however, that such a filing shall not go into effect if the commissioner finds that the rate is excessive, inadequate or discriminatory, or that the rate would adversely affect the financial condition of the insurer or constitute predatory pricing.

(m) Meetings of the governing committee shall be conducted in accordance with the provisions of section 11A½ of chapter 30A.

(n) Before becoming effective and upon any written request of the commissioner on a new plan thereafter, any such plan shall be filed with the commissioner, who shall conduct a public hearing within 30 days to determine whether such plan is consistent with public policy and meets the requirements of this section. At such hearing, insurance companies and any other party having a direct interest shall have an opportunity to be heard. Unless sooner approved or disap184 proved in writing by the commissioner, such plan shall be deemed to meet the requirements of this section within 30 days after the public hearing.

(o) Amendments to such plan shall be prepared and filed with the commissioner as herein provided with respect to the original plan. Such amendments, unless sooner approved or disapproved in writing by the commissioner, shall be deemed to meet the requirements of this section in 30 days from the date of filing. The commissioner shall, prior to the disapproval of any such amendments, issue a notice specifying in what respects the amendments do not meet the requirements of this section and fixing a date for a public hearing thereon, at which insurance companies and any other parties having a direct interest shall have an opportunity to be heard.

(p) If the commissioner shall have requested the submission of a new plan or amendments to the plan, and no such plan or amendments have been filed with and approved by the commissioner within 60 days after such request, the commissioner may, if he deems it necessary to carry out the purposes of this section, prepare and publish proposed amendments or a proposed plan that in his opinion would carry out the purposes of this section. He shall submit a copy of such proposed amendments or proposed plan to the joint committee on financial services at the time of publication, and shall schedule a public hearing thereon not less than 10 days after the publication thereof. After such hearing the commissioner may promulgate such plan or amendments thereto as he finds will best carry out the purposes of this section.

(q) When such plan or amendment has been approved or deemed approved, no insurer may thereafter issue motor vehicle policy or bond unless such insurer shall participate in such an approved plan.

(r) Any insurer and any other party affected may appeal to the commissioner from any ruling or decision with reference to the operation of such plan.

(s) The rules for such plan shall require that separate statistical data be recorded for risks insured in the plan and may provide incentives and penalties to prevent abuse of such plan. The rules for such plan also include a provision giving the commissioner the authority, after due hearing and investigation, to order that any company he finds using practices which have the effect of distributing risks or expenses or losses of risks unfairly and inequitably on other companies or producers be assigned a share of the expenses and losses of said risks to insure a fair and equitable distribution. The commissioner may relieve any insurer of a part or all of its obligations under the plan, if he finds that the continuation of such obligations would threaten the solvency of such insurer.

(t) In appointing a statistical agent, the commissioner shall require, in addition to all other duties and responsibilities, that the statistical agent oversee and conduct a closed claim study so-called. In addition to any other information that the commissioner may require, said study shall include the following: the number of claims filed in a particular year, the average property damage liability coverage claim for said year, the average collision claim for said year, the number of lawsuits filed in said year, the number and average dollar granted in court tried cases in said year, the number and aver- age dollar amount agreed upon in out of court settlements in said year, the average payment arising out of property damage in an out of court settlement and through a judicial decision, the number of multiple claims filed under the same vehicle over a 3 year period, the number of claims closed in said year, the number of claims closed without payment in said year and overall motor vehicle acci243 dent severity and frequency. The study shall also include a report of the profits and losses of each property and casualty company writing private passenger motor vehicle coverage in the commonwealth.

(u) Any insurer or group of insurers participating in such plan and any person aggrieved shall be authorized to bring a complaint to the commissioner alleging unfair or unreasonable or improper practices by any insurer or producer. The commissioner shall, in all such cases, cause a proper hearing on such complaint to be held and shall issue such orders as he then deems appropriate.

(v) If the commissioner finds that, after due hearing and investigation, any activities or practices of any insurer or producer in connection with the submission or operation of such plan is unfair or unreasonable or inconsistent with the provisions of this section, he may issue a written order specifying in what respects such activity or practice is unfair or unreasonable or inconsistent with the provisions of this section, and requiring the discontinuance of such activity or practice.

(w) Any ruling, order or decision of the commissioner under authority of this section shall be subject to review by appeal to the superior court department of the trial court of Suffolk county at the instance of any party in interest, which appeal shall be on the basis of the record of the proceeding before the commissioner. Said court shall have jurisdiction to modify, amend, annul, review or affirm such action, order, finding or decision, shall review all questions of fact and of law involved therein, and may make any other appropri268 ate order or decree. Said court shall determine whether the filing of the appeal shall operate as a stay of any such order or decision of the commissioner.

(x) The plan shall adopt performance standards for claims handling and anti-fraud efforts, for risks insured or reinsured by the plan. All insurers issuing policies insured or reinsured by the plan shall comply with said performance standards. The plan shall develop pre- and post-payment screening systems designed to identify claims overpayments, possible fraudulent claims, and inefficient claims handling practices. The plan shall provide for periodic audits of all members of the plan as required by the commissioner. The audit shall include policies not insured or reinsured by the plan in order to determine whether there is a difference in claims handling between policies insured voluntarily and those insured or reinsured by the plan. Noncompliance with said performance standards and audit requirements shall constitute a violation of the provisions of this chapter. The plan shall propose and the commissioner shall establish rules concerning the submission of data by insurers. Such rules shall include penalties for the late submission of data, the submission of faulty data, and the failure of insurers to comply with the express terms of audit requests. In addition, the plan shall provide for appropriate adjustments in the allocation of premiums, losses and expenses among companies for companies which do not meet such performance standards or which do not comply with said audit requirements. Such adjustments shall reflect excessive claims payments which result from said noncompliance.

SECTION 21. Chapter 175 is hereby amended by striking out section 113I, as so appearing, and inserting in place thereof the following section:-

Section 113I. Nothing in this chapter shall be construed to abridge or restrict the freedom of contract between insurers and producers or to require an insurer to issue policies in any way other than through its ordinary and usual method of marketing except that insurers shall, pursuant to the plan approved under 113W, be required to recognize and to permit immediate certification of insurance by and to pay a commission of 10 per cent to any licensed producer designated as the producer of record by applicants for insurance or renewal thereof. The governing committee identified under section 113W can change this commission on the ground that a different commission is fairer and more reasonable under the circumstances provided the governing committee receives prior written approval from the commissioner at least 30 days in advance of setting such commission.

SECTION 22. Section 113P of chapter 175 is hereby repealed.

SECTION 23. Chapter 175 is hereby amended by adding the following section:-

Section 113W. Notwithstanding any other provisions of this chapter, the commissioner of insurance shall devise an assigned risk plan for private passenger automobile insurance in the residual market. The rates for the assigned risk plan shall be developed in accordance with actuarially sound and established practices and procedures and shall be based exclusively on the losses, premiums and expenses of plan participants. Such plan will be administered by the governing committee, pursuant to section 113H of this chapter. The commissioner shall promulgate such rules and regulations as necessary to implement his plan.

The rules and regulations promulgated by the commissioner to implement the assigned risk plan shall include a provision that prohibits any applicant for private passenger auto insurance in the first year of flex band rating who was clean of any auto insurance claim or violation, except for glass coverage claims in the 5 years preceding the policy effective date, being required to obtain coverage through said assigned risk plan.

The commissioner of insurance is instructed to complete a study on the state of the private passenger auto insurance market including and analysis of the drivers being place in the assigned risk plan. The commissioner of insurance is to make a full report available to the joint committee on financial services and the legislature after 2 years of competitive flex band rating has been completed.

SECTION 24. Section 162C of Chapter 175 is hereby repealed.

SECTION 25. Section 162D of Chapter 175 is hereby repealed.

SECTION 26. Section 193R of chapter 175, as appearing in the 2004 Official Edition, is hereby amended by striking out, in line 26 through 30, the words"; provided, however, that insurance issued pursuant to a group marketing plan shall be cedeable and the experience of each group plan, both voluntary and ceded, shall be used in determining a company's losses and expenses in accordance with the attribution rules established under the provisions of section one hundred and thirteen H".

SECTION 27. Said section 193R of said chapter 175, as so appearing, is hereby further amended by striking out, in lines 32 and 33, the words "having a proper insurable interest" and inserting in place thereof the following words:- who satisfies the eligibility criteria of the plan.

SECTION 28. Said section 193R of said chapter 175, as so appearing, is hereby further amended by striking out, in lines 70 and 78, the words "fixed and".

SECTION 29. Said section 193R of said chapter 175, as so appearing, is hereby further amended by striking out, in line 84, the words "Every mutual company providing insurance in accordance" and is hereby further amended by striking out, lines 85 through 88, inclusive.

SECTION 30. Chapter 175A is hereby amended by striking out section 16, as so appearing, and inserting in place thereof the following section:-

Section 16. No person or organization shall withhold material information from, or knowingly give false or misleading material information to, the commissioner, any statistical agency designated by the commissioner, any rating organization, or any insurer, which will affect the rates or premiums chargeable under this chapter.

SECTION 31. Chapter 175E of the General Laws is hereby repealed.

SECTION 32. Section 1 of chapter 1751 of the General Laws, as appearing in the 2004 Official Edition, is hereby amended by inserting after the word "life,", in lines 3 and 9, the words:- private passenger automobile,.

SECTION 33. Section 2 of said chapter 1751, as so appearing, is hereby amended by striking out, in lines 66 through 76, the definition of "insurance institutions" and inserting in place thereof the following definition:- 5 "Insurance institution", any corporation, association, partnership, reciprocal exchange, inter-insurer, Lloyd's insurer, fraternal benefit society or other person engaged in the business of insurance, including health maintenance organizations, medical service plans, hospital service plans, preferred provider arrangements, insurance companies engaged in the business of private passenger automobile insurance and savings bank life insurance as defined in chapters 175, 176, 176A, 176B, 176C, 176G, 176I, 178 and 178A. "Insurance institutions" shall not include insurance representatives or insurance-support organizations.

SECTION 34. Said section 2 of said chapter 1751, as so appearing, is hereby further amended by inserting after the word "transactions", in line 81, the following words:- ", or to any governmental body or regulatory agency".

SECTION 35. Said section 2 of said chapter 1751, as so appearing, is hereby further amended by inserting after line 94, the following:-

(3) "Insurance-support organization" specifically includes the automobile insurers bureau, commonwealth automobile reinsurers and the insurance fraud bureau, or their successor organizations.

SECTION 36. The General Laws are hereby amended by inserting after chapter 175J the following chapter:-

CHAPTER 175K. FLEXIBLE RATINGS FOR PRIVATE PASSENGER AUTOMOBILE INSURANCE.

Section 1. (a) The commissioner shall, on or before December 15, 2007, fix and establish fair and reasonable rates for all coverages based on accident involvement in connection with the issuance or execution of private passenger motor vehicle insurance policies or bonds that become effective on April 1, 2008. These rates shall also apply to insureds that are ceded to commonwealth automobile reinsurers or insured through the assigned risk plan with policy effective dates between April 1, 2008 through March 31, 2009. These rates shall also apply to any other policyholder of a company where said company does not have an independent rate on file with the commissioner for all or any portion of the period April 1, 2008 through March 31, 2009. This subsection shall be effective through March 31, 2009.

(b)Notwithstanding subsection (a), the commissioner shall not alter the statewide average rate level for bodily injury or personal injury protection based on accident involvement as defined in sections 34A and 34M of chapter 90 or section 113C of chapter 175. The statewide average rates that will be implemented for bodily injury and personal injury protection will be equal to the average rate that the commissioner set on December 15, 2007 and that were in place and became effective as of April 1, 2008. These rate levels will remain in effect for policies with effective dates through March 31, 2010. In accordance with the provisions of subsection (j) and (k.) of section 2, insurance companies may file to increase the statewide average rates for bodily injury or personal injury protection between April 1, 2008 and March 31, 2010 only in the event that a change occurs in the fee schedule applicable to these coverages under section 34S of chapter 90. In such an event, the filed change shall be commensurate with the amount of the change in the fee schedule as applied to the services provided to those injured by automobile accidents. This subsection shall be effective through March 31, 2010.

(c) Not later than August 1, 2008, the industry or its designated rating or advisory organization shall file with the commissioner loss and claim experience current through December 31, 2007. Such data shall include, but not be limited to, accident year losses, trends, and driver class and territory pure premium relatives for each coverage. This subsection shall be effective from April 1, 2008 through March 31, 2009.

(d) Not later than August 1, 2009, the industry or its designated rating or advisory organization shall file with the commissioner loss and claim experience current through December 31, 2008. Such data shall include, but not be limited to, accident year losses, trends, and driver class and territory pure premium relativities for each cover- age. The industry or its designated rating or advisory organization will also file with the commissioner by such date a rate and rating plan for drivers insured through the assigned risk plan to be effective April 1, 2010. This subsection shall be effective from April 1, 2008 through March 31, 2010.

(e) The commissioner may make such rules and regulations as are necessary or proper to carry out the provisions of this section.

Section 2. (a) For purposes of this chapter, the following words shall have the following meanings:

"Commissioner", the Commissioner of Insurance.

"Compulsory insurance", bodily injury liability and personal injury protection as defined in section 34A and 34M of chapter 90, property damage liability as defined in section 340 of chapter 90, and uninsured motorist as defined in section 113L of chapter 175.

"Flex band", the percentage change in the average rate level for insurance policies covering losses or liabilities within the private passenger automobile insurance market wherein increases or decreases shall be no greater than the stated amount in subsections (b), (c), (d), (e) and (f) of the prior average rate implemented for all classifications and risks written by the filing company. Rate increases or decreases within the flex band shall be allocated to classifications and risks based on the actuarially indicated rate for said classification or risk.

"Insurance company" or "insurer”, a company licensed to or authorized to write private passenger automobile insurance pursuant to section 47 of chapter 175.

"Reference filing", upward and downward rate deviations adopted by an insurer relative to the commissioner's fix and established rate effective from April 1, 2008 through March 31, 2009. An insurer's upward and downward rate deviations must be actuarially supported by the insurer's loss and expense experience.

(b) All insurers writing private passenger automobile insurance for policies effective on or after April 1, 2008 and on or before March 31, 2009, must file a reference filing to the commissioner's rates established for that period. The reference filing, at a mini- mum, shall include a minus 5 per cent rate rollback for those vehicles rated based on the experience of insured drivers who (1) have a minimum of 6 years of driving experience and who have had no at fault accidents or traffic violations in the 6 consecutive years preceding the policy's effective date or (2) are occasional operators who have less than 6 years driving experience and who have had no at-fault accidents or violations. Insurers' reference filings may not apply upward rate deviations to drivers eligible for the roll- back. This subsection shall be effective from April 1, 2008 through March 31, 2009.

(c) Overall average rate level increases or decreases proposed by an insurer, for all coverages combined, of 5 per cent above or below the commissioner's rate as set for 2008, shall take effect. Notwithstanding this provision, no vehicle's rate for liability coverages can increase more than 15 per cent in any one 12 month period, provided that there is no change in the individual insured's circumstances including, but not limited to, coverages or coverage options pur102 chased, driving record, years of driving experience, vehicles insured, the garaging location of the insured's vehicle, or the company insuring the vehicle. Insurers must use the territory definitions prescribed by the commissioner for policies issued between April 1, 2008 and March 31, 2009. This subsection shall be effective from April 1, 2008 through March 31, 2009.

(d) Overall average rate level increases or decreases, for all coverages combined, of 6 per cent above or below the company's rate that is currently in effect on March 31, 2009 shall take effect. Notwithstanding this provision, no vehicle's rate for liability coverages can increase more than 15 per cent in any one 12 month period, provided that there is no change in the individual's circumstances including, but not limited to, coverages or coverage options purchased, driving record, years of driving experience, vehicles insured, the garaging location of the insured's vehicle, or the company insuring the vehicle. Insurers must use the territory definitions prescribed by the commissioner for policies issued between April 1, 2008 and March 31, 2009. This subsection shall be effective from the period of April 1, 2009 through March 31, 2010.

(e) Overall average rate level increases or decreases, for all cover- ages combined, of 7 per cent above or below the company's rate that is currently in effect, shall take effect. Notwithstanding this provision, no vehicle's rate for liability coverages can increase more than 15 per cent in any one 12 month period, provided that there is no change in the individual's circumstances including, but not limited to, coverages or coverage options purchased, driving record, years of driving experience, vehicles insured, the garaging location of the insured's vehicle, or the company insuring the vehicle. Insurers must use the territory definitions prescribed by the commissioner for policies issued between April 1, 2008 and March 31, 2009. This subsection shall be effective for the period April 1, 2010 through March 31, 2011.

(f) Overall average rate level increases or decreases, for all coverages combined, of 8 per cent above or below the company rate that is currently in effect, shall take effect. Notwithstanding this provision, no vehicle's rate for liability coverages can increase more than 15 per cent in any one 12 month period, provided that there is no change in the vehicle's coverages or coverage options purchased, driving record, years of driving experience, vehicles insured, the garaging location of the insured's vehicle, or the company insuring the vehicle. Insurers may vary rates by town code, but they may not geographically base rates that further divide the town code by zip code or other means. This subsection shall be effective from the period April 1, 2011 through March 31, 2012.

(g) Overall average rate level increases or decreases, for all coverages combined, of 10 per cent above or below the company rate that is currently in effect, shall take effect. Not withstanding this provision, no vehicle's rate for liability coverages can increase more than 15 per cent in any one 12 month period, provided that there is no change in the vehicle's coverages or coverage options purchased, driving record, years of driving experience, vehicles insured, the garaging location of the insured's vehicle, or the company insuring the vehicle. Insurers may vary rates by town code, but they may not geographically base rates that further divide the town code by zip code or other means. This subsection shall be effective from the period April 1, 2012 through March 31, 2013.

(h) In the event that an insurance company that wrote less than 0.1% of all private passenger vehicles insured in Massachusetts as of December 31, 2007, first files independent private passenger automobile insurance rates in Massachusetts after March 31, 2009 and before April 1, 2013, said company shall be entitled to use the commissioner's rate as set to be effective as of April 1 2008, in addition to the flex band identified in the above subsections (c) through (g) cumulatively for all years. During its second year of doing business in Massachusetts, such filing company will be subject to the flex band in effect for that year only.

(i) An insurance company that wrote .01% or more of all private passenger vehicles insured in Massachusetts as of December 31, 2007 that chooses not to independently file rates utilizing the flex bands in the above subsections (c) though (g) shall be limited to the commissioner's rate set to be effective as of April 1 2008 as modified by the flex band in effect of the year of the filing only.

(j) An insurer may file pursuant to this section more frequently than once per year in any 12 month period provided that the rates applied to any policy are the rates in effect on the effective date of the policy. Insurers may not cancel policies mid-term for the sole purpose of changing the rate applicable to the policy.

(k) The filing company shall notify all insureds of any such changes as part of its renewal notice that shall be mailed or otherwise delivered by written notice at least 30 but not more than 60 days in advance of the end of the policy Period, to the named insured, at the address identified in the policy. Said notice shall state the prospective rate at which coverages will be offered and the duration of the policy period.

(l) All rate filings referenced in subsection (b) through (g) shall be made in accordance with the provisions of section 6 of chapter 175A.

(m) In addition to the filing requirements of section 6 of chapter 175A, all rate filings must contain actuarial support and must be signed by a member of the Casualty Actuarial Society attesting that the requested filing will not produce rates that are excessive, adequate or unfairly discriminatory for the risks to which they apply, and do not threaten the financial stability of the filing company.

(n) In approving an insurer's filing for a rate level change outside the flex band, the insurer making the filing shall show that, if the rate proposed by the insurer is:

(1) above the flex band, the rates available within such band are inadequate for the risks insured and that failure to approve the filing will cause a lack of availability in the relevant market; or

(2) below the flex band, approval of the filing will not adversely affect the financial condition of the insurer or constitute predatory pricing.

(o) No company shall consider a surchargeable accident or violation of 5 years or older for the purpose of rating or underwriting.

(p) Rates for an insured age 65 or older, who otherwise qualifies for the lowest rate classification applicable to drivers generally, shall be 25 per cent less than the applicable rate for such classification. All persons who are entitled to such reduction in rate shall be notified annually of such reduction. The percentage of the reduction for each coverage for an insured aged 65 or older shall be itemized on the motor vehicle liability policy. In the event that an insured reaches the age of 65 during the policy year, and is otherwise entitled to said reduction, said insurer shall receive a reduction in premium on a pro rata basis for the remainder of the policy year.

(q) If at any time the commissioner finds that a filing, including any rate or rating plan, does not meet the requirements of this chapter, provides rates that are excessive, inadequate or unfairly discriminatory, or includes a rating plan that is unfairly discriminatory, he shall, after a hearing held upon not less than ten days written notice, specifying the matters to be considered at such hearing, to every insurer and rating organization which made such filing, issue an order specifying in what respects he finds that such filing fails to meet the requirements of this subsection, and stating when, within a reasonable period thereafter, such filing shall be deemed no longer effective. Copies of said order shall be sent to every such insurer and rating organization. Any person or organization aggrieved with respect to any filing which is in effect may make written application to the commissioner for a hearing thereon; provided, that the insurer or rating organization that made the filing shall not be authorized to proceed under this subsection. Such application shall specify the grounds to be relied upon by the applicant. If the commissioner shall find that the application is made in good faith, that the applicant would be so aggrieved if his grounds are established, and that such grounds otherwise justify holding such a hearing, he shall, within thirty days after receipt of such application, hold a hearing upon not less than ten days written notice to the applicant and to every insurer and rating organization which made such filing. If, after such hearing, the commissioner finds that the filing does not meet the requirements of this subsection, he shall issue an order specifying in what respects he finds that such filing fails to meet the requirements of this subsection, and stating when, within a reasonable period there-after, such filing shall be deemed no longer effective. Copies of said order shall be sent to the applicant and to every such insurer and rating organization. The commissioner may also call a hearing at any time prior to the proposed effective date of any filing or any later effective date called for by order made pursuant to this chapter. If after such hearing the commissioner finds that any such filing will not meet the requirements of this subsection, said filing shall not take effect.

(r) The commissioner may promulgate rules and regulations implementing the provisions of this section.

(s) On April 1, 2013, subsections (b) through (g) regarding flex bands and such filings, other than the restriction that no vehicle's rate for liability coverages can increase more than 15 per cent in any 12 month period, shall no longer be applicable.

(t) The following provisions apply to company filings for rates to be effective on or after April 1, 2008. For the purposes of tempering rates in high rated urban territories, territorial average rates for the bodily injury liability and personal injury protection coverages, as defined in Ch. 90, section, 34A and 34M shall be based on a weighted average loss per insured vehicle where 75 per cent of the weight is applied to the indicated territorial average loss per insured vehicle, and 25 per cent of the weight is applied to the indicated statewide average loss per insured vehicle. Such weighting shall be applied equally to all rating territories used for the purpose of determining private passenger auto insurance premiums. Nothing in this section prohibits further adjustment of the final rates charged in any given territory by operation of average rate caps.

(u) Gender may be used as a rating factor for operators in their first 6 years of driving experience.

Section 3. (a) No insurer or rating organization shall monopolize or attempt to monopolize, or combine or conspire with any other person or persons to monopolize, in any territory, the business of insurance or any kind, subdivision or class thereof.

(b) No insurer or rating organization shall agree with any other insurer or rating organization to charge or adhere to any rate, although insurers and rating organizations may continue to exchange statistical information and provided further a rating organization may establish advisory manuals of classifications, rules and rates, rating plans or modifications of any of the foregoing in any manner not prohibited by the commissioner.

(c) No insurer or rating organization shall make any agreement with any other insurer, rating organization or other person to restrain trade.

(d) No insurer or rating organization shall make any agreement with any other insurer, rating organization or other person the effect of which may be substantially to lessen competition in any territory or in any kind, subdivision or class of insurance.

(e) No insurer may acquire or retain any capital stock or assets of, or have any common management with, any other insurer or insurers, if the effect of such acquisition, retention or common management may be substantially to lessen competition in any territory or in any kind, subdivision or class of insurance.

(f) No insurer or rating organization shall make any agreement with any other insurer or rating organization to refuse to deal with any person in connection with the sale of insurance.

(g) No rating organization or member or subscriber thereof shall interfere with the right of any insurer to make its rates independently of such rating organization or to charge rates different from the rates made by such rating organization.

(h) No rating organization member or subscriber shall refuse to do business with, or prohibit or prevent the payment of commission to any licensed producer on the ground that such producer does business with an insurer, which makes its rates, or any portion thereof, independently of such rating organizations.

(i) Nothing contained in this chapter shall be constructed as requiring any insurer to become a member of or a subscriber to any rating organization, or as preventing any insurer, while a member of or subscriber to a rating organization, from making its own rates for any kind, subdivision or class of insurance, for which it does not elect to authorize the rating organization to act on its behalf.

(j) Any insurer, which is a member of or a subscriber to a rating organization, may make its own rates for any kind, subdivision or class of insurance. No rating organization shall have authority to act on behalf of any insurer which is a member of or subscriber to such rating organization except as authorized in writing by such members or subscribers, which authority may be supplemented, modified or revoked, in whole or in part, at any time by such member or subscriber at its option.

(k) No rating organization shall have or adopt any rule or execute any agreement, or formulate or engage in any program, the effect of which would be to require any member, subscriber or other insurer to utilize some or all of its services, or to adhere to its rates, rating plans, rating systems, underwriting rules, or policy forms, or to pre324 vent any insurer from acting independently.

(l) Any rate made in violation of subsections (a) though (k) of this section or section 4 of this chapter shall be disapproved by the corn- missioner pursuant to the procedures prescribed in section 7 of chapter 1 75A, and each violator shall be punished by a fine of not more than $10,000 for each offense or by imprisonment for not more than 1 year, or by both; or shall be subject to a civil penalty not to exceed $1,000 for each such offense which may be assessed in an action brought on behalf of the commonwealth in any court of competent jurisdiction. The issuance, procurement or negotiation of a single policy of insurance shall be deemed a separate offense.

(m) The commissioner, through the attorney general, and any person injured in his business or property by reason of anything forbidden in aforesaid subsections may maintain an action to enjoin any such violation of such subsection.

(n) Any person injured in his business or property by reason of anything forbidden in the aforesaid subsections may maintain an action and shall recover threefold the damages sustained by him.

(o) The provisions of subsections (a) through (k) shall not be construed to prohibit 2 or more insurers who by virtue of their business associations in the United States represent themselves to be or are customarily known as an insurance company group", or similar insurance trade designation, from having the right to exchange statistical information.

(p) The fact that 2 or more admitted insurers, whether or not members or subscribers of a rating or advisory organization, use, either consistently or intermittently, the manuals of classifications, rules and rates, rating plans, modifications of any of the foregoing or recommendations of such organizations, shall not be sufficient in

itself to support a finding that an agreement to adhere exists, and may be used only for the purpose of supplementing or explaining direct evidence of the existence of any such agreement.

Section 4. (a) No insurer or rating organization shall file in bad faith rates which it knows or should know are grossly inadequate for the insurance coverage provided, and which are filed and used for the purpose of unfairly competing for motor vehicle insurance risks.

(b) At any hearing conducted under this section, the burden shall be on the filer to justify that such filing is not in violation of this section. If, after such hearing, the commissioner finds that the filer has filed to so justify such filing, he may order that all policies written under such bad-faith filing be rewritten at rates meeting the requirements of this chapter from the date of inception of such policies, or that all such policies be cancelled on a pro rata basis.

Section 5. The commissioner may once in each calendar year establish rules by which the companies shall produce an information guide which outlines in language prescribed or approved by the commissioner the various choices of coverage available to insureds and an approximation of differences in cost among various types of coverage and among competing carriers. Each company shall bear full responsibility for assuring that a copy of such information guide

is forwarded to every person insured or who requests a quote for insurance from that company, or who solicits from that company's producers.

Section 6. Insurance companies or their producers shall disclose in simple language to every person they insure or solicit for insurance that person's coverage options, including the option to exclude oneself and members of one's household from personal injury protection coverage, so-called. The commissioner shall prescribe the form, content, and timing of said disclosures.

Section 7. (a) An insurer, or a producer, doing business in this state may not require a person to use a particular insurance premium finance company or other installment plan for which a finance charge or other fee in connection with an installment payment has been or will be imposed.

(b) An insurer, or a producer, doing business in this state may not refuse to issue a policy of insurance solely because the premiums for the policy have been advanced by a premium finance company.

SECTION 37. The commissioner, in consultation with the director of the office of consumer affairs and business regulation, shall develop and publish by January 1, 2008 both in hardcopy and on the Division of Insurance's website a "Consumer Bill of Rights for Automobile Insurance," pamphlet setting forth a summary of consumers' rights and responsibilities with respect to such policies.

There is hereby established a fund known as the Interactive Auto Insurance Website Fund in the division of insurance, consisting of revenues deposited by insurance companies that write private passenger automobile insurance in the state. Such companies shall contribute a total of $1,000,000 to the division of insurance based on their pro rata share of exposures written in this state as of the most recent calendar year.

This fund shall be used to make available to the consumer a content neutral interactive website dealing with the purchasing and availability of private passenger auto insurance in the commonwealth.

SECTION 38. Except as otherwise specified, this act shall take effect upon passage.