Homeowners across Massachusetts See Reduced Impacts on Policies after Patrick Administration's Insurance Commissioner Approves Stipulation
FAIR Plan agreement eliminates Cape Cod increase, slashes in half increases slated for some cities, creates overall decrease of .72 percent
The order by the Acting Commissioner eliminates a proposed rate increase for Cape Cod residents, and slices in half proposed rate increases in areas such as New Bedford, Worcester and Springfield. Many areas, such as Boston, see decreases through the order.
"I am very pleased that the Division's State Rating Bureau so ably negotiated this overall decrease on behalf of the consumers of the Commonwealth. Ensuring that the insurance rates are commensurate with the benefits provided at the most reasonable cost is the Division's priority," Murphy said. "If it weren't for the diligent work of the Division's rating bureau staff, consumers would have seen rate increases, some of which did not appear to be justified."
The FAIR Plan is made up of all of the state's homeowners' insurance companies, and is open to homeowners who are unable to get insurance through the private market. As of June 30, 2009, there were 153,675 policies in the FAIR Plan.
In October, the FAIR Plan offered a plan for a 2.2 percent increase overall, which included a 2.4 percent increase on the Cape and the Islands, and 10 percent increases in areas like New Bedford, Worcester, and Springfield. The order approved by the Acting Commissioner eliminates the Cape and Island increase, and limits increases to a maximum of 5 percent in New Bedford, Worcester and Springfield. Overall, the stipulation creates a .72 percent decrease statewide.
"The Division of Insurance's chief responsibility is to be a regulator that protects the public's interests while also maintaining fairness in the industry. This stipulation approved by the Acting Commissioner balances those duties," said Barbara Anthony, the Undersecretary of the Office of Consumer Affairs and Business Regulation, which oversees the Division of Insurance. "This is very good news for homeowners in the FAIR Plan, who know that through the Division's efforts their rates are not being unfairly changed."
The FAIR Plan stipulation was negotiated through the State Rating Bureau and the FAIR Plan, along with the state Attorney General's Office.