Drivers Find Improved Benefits, More Discounts as Patrick-Murray Administration's Auto Insurance Reform Hits Third Anniversary
Hundreds of millions saved as 13 new companies enter Massachusetts marketplace
BOSTON - April 4, 2011 - As the Patrick-Murray Administration's reform of auto insurance turns three years old, drivers around the state are able to take advantage of more discounts and expanded benefits as the competitive marketplace continues to mature.
Managed competition went into effect April 1, 2008, ending the fixed-and-established system under which the state set auto insurance rates. The new system created a marketplace that allows companies to compete for consumers through rates, discounts, and benefits. Since the start of the reform, 13 new companies have entered the state, including three of four biggest carriers in the country (Allstate, Progressive and GEICO).
"In three years we have seen managed competition grow into a market that allows consumers wide choices in companies, coverage and cost, where there was almost none before," said Joseph G. Murphy, the Commissioner of the Division of Insurance. "This new system will continue to grow as more companies enter Massachusetts and carriers continue to aggressively compete for drivers."
Managed competition has opened the door to a number of new discounts that can save consumers 10 percent or more and benefits that were previously not available to consumers in Massachusetts. This includes items like accident forgiveness, disappearing collision deductible, emergency lodging and meals benefits, hybrid discounts, loan or lease gap coverage, and coverage of pets.
While hundreds of thousands of drivers have seen lowered premiums through managed competition, many have not proactively shopped for better auto insurance. Officials encourage drivers to visit www.mass.gov/autorates , research carriers' websites, and meet with their insurance agent to consider an auto insurance policy that combines appropriate coverage at the best cost.
"For too long Massachusetts consumers had little choice when it came to auto insurance, and no incentive to shop around for better deals," said Barbara Anthony, the Undersecretary of the Patrick-Murray Administration's Office of Consumer Affairs and Business Regulation. "Managed competition has given that incentive to shop back to drivers. A few hours of research can be paid back with hundreds of dollars saved on premiums."
The Massachusetts Division of Insurance ( www.mass.gov/doi) is an agency within the Office of Consumer Affairs and Business Regulation. Follow the Office at www.mass.gov/consumer , its Consumer Connections Blog and at its Twitter feed, @Mass_Consumer.