I like the idea of bringing competition to the Massachusetts auto insurance market. Under regulation, a handful of insurance companies with political clout worked the game to their advantage, not the consumers’ advantage. Other insurers – notably ‘Net-based operations like Geico that can offer lower rates by cutting out the independent agent middlemen – refused to sell policies here.
So now we have managed competition under a new set of rules, but like most modern reforms, it has added a whole new thicket of financial decision-making to our over-stressed lives. The Patrick Administration wants to help, but its Web site only gives you an accurate premium figure 20 percent of the time, AG Martha Coakley says. And while everyone says let your independent agent find the best price for you, they don’t tell you that most independent agents only sell policies for certain companies, and the one with the best deal for you might not be on their list. Real comparison shopping will take a lot of phone calls and driving around to insurance offices — and Geico still won’t do business here.
I’ve got a column on the topic in today’s MetroWest Daily News.
under Romney and was touted as “fairness for good drivers” until it was revealed that the insurance companies really wanted the ability to sell only to people they wanted to sell to, for the cut rate price anyway. Things like your credit score would come into play as to your ability to buy auto insurance. The end around though was accomplished by under the radar legislative “reform” and perhaps by the insurance industry’s funding of Deval’s five day Ball.
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p>Yeah, maybe I am guilty of the sin of thinking government in this state does not operate in the citizens best interests. I have repeatedly brought up the fact that my 5000 dollar company sponsored health insurance program routinely denies payment of health benefits and has been sued under the RICO statues for doing so yet health insurance is now required in mAssashusetts.
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p>It should be crystal clear by now government’s refusal to regulate parasitic behavior by corporations does in fact contribute to the end of western civilization.
BTW – the rationale is that if your credit score is in the tank, and you have a $400,000 home, you become what is called in the industry a ‘moral hazard’ – that is, your debt problems may drive you to consider arson.
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p>I didn’t have a problem with using the score per se, but I DID have a problem that customers weren’t notified that the score was being obtained and used to determine coverage. It’s part of why I left personal lines for commercial lines.
Moral hazard does not refer to the sort of criminal behavior that you’re describing — unless the actor were for some reason insulated from criminal liability. Even then, though, it’s not really “moral hazard,” which normally refers to not being careful, as opposed to intentionally engaging in harmful conduct.
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p>Wikipedia’s definition is pretty good:
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Because they all sem to find the use of credit scores for insurance rating to be an outrage.
I am even slightly outraged that minor violations raise your premiums, rather than accidents and near accidents. It should not have anything to do with credit, companies should not be competing for the customers that are more likely to pay at the expense of people that obviously can’t afford to subsidize rich people.
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p>Are you happy now, CentralMassDad? Enjoy your time shopping around for the best rate? Did your rates go down yet? Thanks a lot for making life more difficult and unfair by supporting this.
Wah! I want the government to do my work for me!
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p>2-3 phone calls to save a few hundred bucks is OK by me. Oh, the unfairness of it all!
Where did that few hundred bucks come from? Who is paying a few hundred bucks more?