Boston and all Massachusetts drivers will continue to see managed auto insurance competition in the state. The Massachusetts Supreme Judicial Court ruled in favor of the Massachusetts Division of Insurance's decision to temporarily exempt auto insurance companies that are new to the Bay State from having to cover high-risk motorists. The Massachusetts Division of Insurance recently allowed managed competition as a way to allow auto insurer companies to compete for good drivers, giving consumer more choices than ever before. The argument is that competition results in better rates for better drivers across the Commonwealth of Massachusetts, and the Law Office of Neil Burns wants to inform Massachusetts residents that they should now compare auto insurance rates before buying or renewing their auto insurance policy.
The Supreme Judicial Court's ruling was the result of a 2008 lawsuit filed by Arbella Mutual Insurance challenging the fact that national insurance companies that are new to the Massachusetts insurance market did not have to cover high-risk drivers for two years. Arbella argued that exemption put Massachusetts insurers like Arbella at a disadvantage, because they are required to insure high-risk motorists and split the losses, based on their market shares in the state. The court ruled that although the new companies don't incur the losses of insuring bad drivers, they contribute administrative costs to the Massachusetts Automobile Insurance Plan, which provides insurance for high-risk drivers. In effect, the Court said that that was good enough to allow the exemption to stand.
The goal was to attract new insurers to the market and, in turn, give Bay State drivers more choices. Since the change allowing the exemption, eleven companies, including Progressive Insurance, Allstate Insurance Co., and Geico, have entered the market, according to the Division of Insurance. "This is further good news that managed competition is properly rewarding consumers and providing more flexibility and choice in the market,'' said Joseph G. Murphy, who took over as insurance commissioner last week.
When you are ready to buy insurance, try comparing insurance policies and prices by using this link. You can see examples from each company and the range of premiums you could see if you shop around.
