8 - Consumer Service

8.1 Mission

The Consumer Services Section (CSS) responds to inquiries and assists consumers in resolving complaints against insurers, producers and other licensees. In addition to providing consumers with general insurance information in the form of brochures and guides, the Section also advises consumers on their options and rights under their policies, state laws and insurance regulations.

8.2 2009 Goals



Reduce the number of outstanding written complaints over 90 days old.


Post an electronic version of the newly created CSS training manual on the CSS intranet site for ongoing use as a resource to CSS examiners.



Continue on-going training for existing and newly hired CSS staff on insurance topics in areas of property & casualty insurance, underwriting, and claims handling available through the Insurance Library in order to better assist the public.



Maintain and schedule monthly training sessions for CSS staff offered by the State Rating Bureau to cover topics in areas of health care reform and the current status of the competitive auto market affecting consumers.



Increase the number of case referrals to Special Investigations Unit (SIU) and enhance examiner's knowledge by implementing internal training from SIU in order to comply with the department's mission of tracking and reporting market conduct issues.

8.3 Primary Activities

Consumer Hotline Calls

Insurance consumers receive personal assistance from the Division's Consumer Services staff by calling the Consumer hotline Monday through Friday, 8:45 a.m. to 5:00p.m. All hotline calls are logged into a call database. This database allows the Division to gather a range of sortable data on each call. CSS runs a variety of reports based on this data in order to show trends in consumer hotline calls.



Examiners answer questions regarding most lines of insurance and offer information about companies and producers, such as the status of licenses and complaint data. Consumer Services staff refer callers to the materials on the InsureMass section of the Division's website in order to provide deeper background on the question or complaint.

In addition to informational requests, approximately one in ten calls to the hotline is a consumer complaint. Examiners are often able to resolve such complaints over the phone with a simple verbal explanation of the relevant insurance law or contract provision. In other cases, Consumer Services staff recommend that the caller file a formal complaint to the Division.





In 2009, call volume on the Division's consumer hotline increased significantly due to questions and concerns from consumers regarding health care reform and the high cost of small business health insurance. While the Division does not have a role in connecting people with health coverage, we did see a rise in the number of calls from people who were unable to find affordable coverage through the individual and small group market. Additionally, the individual mandate for minimum creditable coverage continues to generate consumer calls.


























2009 Consumer Informational Calls

Top 5 Reasons by Line of Insurance

Automobile Insurance

Health Insurance

Claim Settlement Timeframe

Continuation of Coverage

Cancellation

Mini-COBRA

Merit Rating Plans \ SDIP

Minimum Creditable Coverage

Premiums \ Rates

Mandated Benefits

Determine ACV

Co-payments

Home Insurance

Life Insurance

Claim Settlement Timeframe

Interest Paid on Claims

Cancellation

Claim Settlement Timeframe

Non-renewal

License Status

Coinsurance



# of Complaints Against Company

# of Complaints Against Company

Cancellation


2009 Consumer Complaint Calls

Top 5 Reasons by Line of Insurance

Automobile Insurance

Health Insurance

Denial of Claim

Denial of Claim

Delays

Coordination of Benefits

Cancellation

Consumer Education Needed

Coverage Question

Delays

Consumer Education Needed

Coverage Question

Home Insurance

Life Insurance

Denial of Claim

Consumer Education Needed

Delays

Misappropriation

Coverage Question

Delays

Cancellation

Coverage Question

Adjuster Handling

Denial of Claim



Written Consumer Complaints



Any consumer of an insurance product marketed or sold in Massachusetts may file a written consumer complaint with the Consumer Services Section against an insurer or insurance producer. Written complaints are forwarded to the company or producer for response. Licensees must respond to the Division within 14 days with a complete reply addressing all issues raised in the consumer complaint. Section examiners review the complaint and licensee reply, and advocate for the rights of consumers where appropriate.

The complaint database provides for both proper case management and the reporting of complaint data. In order to protect the insurance public and accomplish the Division's mission of forecasting trends regarding the insurance industry, the Section generates monthly reports from the complaint database. These reports allow the Division to look for patterns of unfair or deceptive practices by producers, insurance companies, or other licensees. When appropriate, the information may be referred either to the Special Investigations Unit or Market Conduct Section for further action. "Slow pay" patterns and other questionable industry trends are brought to the attention to the Division's Financial Surveillance staff, as these may be early indicators of liquidity or solvency problems.



Along with training in key content areas, CSS also conducted a series of internal strategic planning sessions aimed at maximizing the quality of complaint reviews. For the third consecutive year, the Section secured a substantial increase in consumer recoveries. In 2009, CSS staff resolved over 1700 written complaints and recovered close to $3 million for consumers.

Complaint Dispositions



The vast majority of complaints with positive outcomes result in dollar recoveries for consumers. While they are very important, these recoveries are only one of several possible favorable resolutions for a consumer complaint. In many cases, consumers complain to the Division because their insurance company is unresponsive or slow in settling a claim. Such cases typically involve a delay resolution in addition to a recovery. In other cases, the Section assists consumer working to restore policies, rescind cancellations or waive fees.





Complaint Response Time



The top priority of the Consumer Service Section is to find the correct answer to consumer questions and complaints. The Division places more importance on accuracy than on speed. Nonetheless, the Section recognizes that timeliness is an essential element in the proper handling of a consumer complaint.

In many cases, consumers have already experienced a substantial delay in the resolution of their dispute with the insurer before a complaint is filed with the Division. Claim denials and policy cancellations leave consumers in a financial limbo - they cannot move forward or back without a definitive answer on an unresolved insurance dispute. The staff of the Consumer Service Section has the goal of resolving each consumer complaint in 90 days or less. For most of 2009, Consumer Services operated at 65% of operational capacity due budget cuts and one staff on medical leave. Despite these limitations, Section staff were still able to handle the majority of cases within the target 90-day window.

Consumer Services Section Statistics



Complaint Ratios

Among the thousands of questions posed by consumers calling the Division's hotline concerns the reputation of particular insurance companies. Consumers shopping for coverage often look for some objective measure of customer service on the part of specific companies. Each year, the Division posts updated complaint ratios for major insurers in the private passenger automobile and homeowner's insurance markets. The ratios are calculated by comparing the share of complaints filed against a company to that company's market share. This figure is then normalized to a ratio per $10 million in premium written in order to control for different levels of market share.

In 2009, the Consumer Services Section handled over 500 private passenger automobile insurance complaints. Complaint ratios for the 20 largest carriers are listed below

2009 Private Passenger Automobile Insurance

Complaints and Market Share

Company

Premium Share

in 2009

Complaints Filed in 2009

Complaints per $10,000,000 in Premium

Commerce Group

28.83%

128

1.25

Safety Group

10.88%

48

1.24

Liberty Mutual Group

9.64%

47

1.37

Arbella Insurance Group

8.96%

36

1.13

Plymouth Rock Assurance Corporation

5.93%

26

1.23

Travelers Group

5.78%

35

1.70

Metropolitan Group

5.67%

44

2.18

Hanover Insurance Group Allmerica Financial

3.78%

34

2.53

Amica Mutual Group

3.53%

18

1.43

Progressive Group

3.35%

37

3.11

White Mountains Group

2.28%

14

1.72

United Services Automobile Association Group

2.21%

8

1.02

Quincy Mutual Group

1.85%

12

1.82

Allstate Insurance Group

1.51%

15

2.79

Main Street American Group

1.16%

6

1.45

Norfolk & Dedham Group

1.16%

6

1.45

Berkshire Hathaway Group

0.72%

5

1.96

Vermont Mutual Group

0.46%

0

0.00

IAT Reinsurance Company Group

0.43%

0

0.00

State Farm Group

0.42%

2

1.34

Remainder of Market (13 Groups)

1.46%

16

3.09


The number of consumer complaints regarding homeowner's insurance is significantly smaller than the number of automobile insurance complaints. In order to ensure that comparisons between companies are valid, the Division groups together homeowner's complaints from a five year period: 2005 -2009. Unlike the automobile insurance market, the homeowner's insurance contains a large number of carriers with comparatively small market shares. In calculating complaint ratios, the Division looks at the top 25 company groups and the Massachusetts Property Underwriting Association (FAIR Plan).

2005 - 2009 Homeowner's Insurance

Complaints and Market Share

Top 25 Company Groups & Fair Plan

Premium Share

2005-2009

Complaints Filed 2005-2009

Complaints per $10,000,000 in Premium

MA Property Underwriting Association (FAIR Plan)

13.33%

146

1.21

Commerce Inc. Group

8.83%

70

0.88

Andover Group

6.96%

39

0.62

Travelers Group

6.82%

48

0.78

Chubb & Son Inc. Group

6.67%

7

0.12

Liberty Mutual Group

6.24%

42

0.75

Arbella Insurance Group

4.74%

35

0.82

Quincy Mutual Group

4.70%

35

0.83

Vermont Mutual Group

3.30%

24

0.81

Safety Group

3.22%

22

0.76

The Hanover Insurance Group

2.78%

10

0.40

Metropolitan Group

2.68%

17

0.70

Amica Mutual Group

2.63%

9

0.38

Norfolk & Dedham Group

2.50%

10

0.44

United Services Automobile Association

2.30%

6

0.29

White Mountains Group

2.25%

13

0.64

Plymouth Rock Insurance Group

1.83%

12

0.73

Preferred Mutual Insurance Company

1.66%

25

1.67

Hingham Mutual Group

1.50%

22

1.62

Barnstable Group

1.49%

2

0.15

Allianz Insurance Group

1.42%

3

0.23

Zurich Insurance Group

1.41%

5

0.39

Main Street America Group

1.19%

3

0.28

Providence Group

1.02%

10

1.09

Harleysville Group

0.93%

8

0.95

New London County Group

0.90%

6

0.74


8.5 Online Consumer Publications

As part of their mission to provide insurance consumers with accurate and useful informational materials, the Division creates, updates and publishes a range of insurance materials in print and online. These materials must find a way to explain relatively complex insurance topics in a manner easily understood by the average consumer. Every publication created and maintained by the Division is also posted on our website. Below is a list of consumer publications and web pages available as of December 31, 2008.

Automobile Insurance


  • Accident Forgiveness: What You Should Know
  • Shopping for Auto Insurance Step by Step
  • It Pays To Shop Around (Consumer FAQ)
  • Massachusetts Consumer Bill of Rights for Auto Insurance
  • Massachusetts Auto Insurance Plan (MAIP) Consumer Guide
  • Ways to Save on Your Auto Insurance 2008
  • FAQ on Auto Insurance
  • Automobile Group Marketing Plans (Group Discounts)
  • Safe Driver Insurance Plan (SDIP) - How SDIP Works, Appealing Surcharges, & Hearing Locations
  • How to Appeal Your Driver's License Revocation
  • How to Appeal an Auto Insurance Cancellation
  • List of Companies Writing Automobile Insurance in Massachusetts
  • Automobile Insurance Consumer Complaint
  • Motor Vehicle Insurance Installment Plans


Homeowner's Insurance


  • Commissioners Report on Homeowner's Insurance
  • Flood Insurance Facts
  • Flood Insurance FAQ
  • National Flood Insurance Program
  • FAQ on Homeowner's Insurance
  • Homeowner Group Marketing Plans 2009 (Group Discounts)
  • Homeowners Warranty Contracts
  • MAHA Homesafe Program & Discounts
  • Homeowner Insurance Service Areas
  • Companies Writing Home Insurance in Massachusetts
  • A Massachusetts Guide to Insurance for Your Home and Ways to Help Reduce Your Insurance Premiums
  • A Massachusetts Guide to Understanding the Insurance Policy Covering Your Home
  • FAQ on Flooding and Insurance

Life Insurance


  • Lifestyle Choices and Premium
  • Have you Reviewed your Life Insurance Policy
  • Buying Life Insurance and Annuities in Massachusetts

Health Insurance


  • Health Insurance Plans: Which Plan is Right for You
  • Health Insurance Plans: Four Things You Should Know
  • Health Care Reform Tips and Resources
  • Consumer Guide to Health Care Coverage
  • Consumer Guide to Individual and Small Groups
  • Employer FAQ on Non-discrimination and Equal Contribution Requirements
  • Long Term Care Guide
  • Mandatory Benefits Guide
  • Medigap/HMO Guide Effective
  • MiniCobra Continuation of Coverage Benefits Guide

Workers Compensation Insurance



  • Workers Compensation FAQ for Employees
  • Workers Compensation FAQ for Employers

Miscellaneous Insurance Guides


  • New Parents Need To Get Smart About Insurance
  • Commercial Insurance: A Small Business Guide
  • Renter's Insurance
  • Credit Insurance
  • Boat Insurance
  • Recreational Vehicle Insurance
  • Travel Insurance
  • Pet Insurance
  • Wedding Insurance
  • Winter Weather Insurance
  • Identity Theft
  • Insurance Fraud
  • Disaster Information

Consumer Alerts


  • Medicare Prescription Drug Annual Enrollment
  • Improve Your Health Insurance IQ
  • Changes in FEMA Flood Insurance Maps
  • Auto Insurance Advertising
  • H1N1 and Insurance
  • Claims Process
  • ID Theft and College Students
  • Travel Insurance Tips
  • Health Insurance During Layoffs
  • Insurance Fraud
  • Homeowner to Renter
  • Beware of Unlicensed Health Plans
  • Risks of Self-funded Health Plans
  • Premium Assistance for Employees of Small Employers
  • Consumer Alert: Annuities and Senior Citizens
  • Winter Weather and Insurance
  • Insured for Summer Fun