Q. What change is taking place in the handling of claims?
A. All claims under policies issued by Trust Insurance Company are now being transitioned to the Massachusetts Insurers Insolvency Fund ("MIIF") and similar guaranty funds in other states. Claims under policies issued by Trust Assurance Company (none of which are automobile policies) will continue to be handled by the Trust staff, since Trust Assurance is not insolvent.
Q. Why is this change taking place?
A. The Receiver has determined that there are not sufficient liquid assets in the estate of Trust Insurance to continue to pay the claims afforded administrative expense priority (those with accident dates from 2/10/00 - 8/1/00). For that reason, MIIF will now provide the funding to pay these losses.
Q. What impact does this change have on the 2/10/00- 8/1/00 pending claims?
A. These claims will now be handled in the same manner as the claims previously transferred to the guaranty funds. MIIF and other guaranty funds are only responsible for "covered claims", as defined in their respective statutes. In general, "covered claims" are limited to $300,000 per occurrence, or the policy limits, whichever is less. In addition, guaranty funds typically do not pay claims for which there is other available insurance (for example, the uninsured motorist coverage of the injured claimant).
Q. How does the "other available insurance" feature work?
A. Typically, a guaranty fund will alert a policyholder or claimant that they need to exhaust all other available insurance before their claim may be considered for payment by the guaranty fund. Under Massachusetts automobile policies, uninsured motorist coverage is triggered if the responsible party's insurer is insolvent and unable to respond to a loss. Third party bodily injury claimants will therefore need to exhaust their own uninsured motorist's coverage before MIIF will consider paying any "excess" aspect of the claim. Similarly, before MIIF will consider paying a policyholder's PIP claim, medical expenses covered by the policyholder's health insurance will need to be exhausted, as well as any other household PIP coverage which may apply.
Q. How can I obtain answers to other questions which I might have?
A. You may contact the Consumer Help Line at the Massachusetts Division of Insurance by dialing (617) 521-7777.