For Immediate Release - March 12, 2009

Insurance Commissioner Responds to Consumer Concerns about Accident Dispute Changes

Move continues managed competition's focus on consumer protection, bringing benefits to drivers everywhere in Massachusetts

BOSTON - Thursday, March 5, 2009 - Responding to concerns from Massachusetts consumers, Insurance Commissioner Nonnie S. Burnes today announced she will offer additional rules in the coming weeks that address concerns raised by consumers and continue managed competition's focus on protecting and delivering benefits to drivers everywhere in Massachusetts.

"Managed competition has been and continues to be a success story for good drivers everywhere in Massachusetts," said Commissioner Burnes. "Our foremost priority is consumers, and ensuring they experience every benefit our competitive market has to offer in terms of price, choice and service. The rules we develop around at-fault accident designations will reflect our commitment to consumers just as the transition to managed competition has since day one."

Managed competition, effective since April 1, 2008, eliminated the old "fix-and-establish" auto insurance marketplace where rates were set by the Division of Insurance, and instead created an environment that allows drivers for the first time in 30 years to shop for cheaper insurance that fits their needs. Attracted by the opportunity to compete for new customers, the change has also brought six new companies into Massachusetts.

Immediately following the start of managed competition, consumers began to see benefits in the form of rate reductions ranging from 6 to 11 percent from the largest insurers in the state. The Division estimates nearly half of all good Massachusetts drivers saved at least 10 percent on their 2008 auto insurance premiums compared to 2007. In addition, some companies began to offer "accident forgiveness" benefits, and some offer reduced premium increases for at-fault accidents or moving violations from six years to three years.