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Rate Cuts Should Be Automatic for Massachusetts Auto Insurers

Although a number of auto insurers have voluntarily reduced their rates for the past two months, Massachusetts State Attorney General Maura Healey recently sent an open letter to letter to Insurance Commissioner Gary Anderson imploring him to ask all auto and business insurers to a drop their premiums. The number of accidents since the state implemented its lockdown have substantially decreased with Massachusetts experiencing a 50% to 55% drop in traffic levels. Accidents in many states are down by 50% or more. With fewer cars on the road, the risk for accidents has drastically fallen. 

Many people are experiencing layoffs or have lost their jobs outright. Non-essential businesses have either shuttered or are operating at minimum levels causing business owners and employees to struggle to meet expenses. 

AG Healey’s request follows an earlier joint letter sent on March 18, 2020 by the Center for Economic Justice and the Consumer Federation of America (CFA) to all state insurance commissioners. It also urged insurers to reduce rates in the face of dramatic drops in miles traveled and road accidents. Their letter advised that people who were not being given a discount would be paying an excessive premium. A CFA spokesperson stated they had also asked insurers and regulators to refund “excessive premiums” to those businesses that have experienced serious cash shortages including meeting payrolls and are subject to collapse due to the virus. He commented that those insurers are sitting on” pandemic windfalls.” 

Car Accident and Insurance

A number of insurers have lowered their rates by varying amounts. Consumer Reports published their rate reductions that include:

  • Allstate—a 15% reduction for the months of April and May with a special payment plan for insurer and eliminating non-coverage provisions for insurers using their vehicles to deliver food, medicine, and other supplies for commercial purposes
  • Amica—a 20% reduction for April and May
  • State Farm—up to 11% reduction for April and May
  • Liberty Mutual—a 15% reduction for two months
  • American Family—a $50 one-time payment for each insured vehicle and flexibility for delayed payments
  • Safeco—a 15% reduction for two months
  • Nationwide—a one-time rebate or $50
  • Farmers—a 25% reduction in April
  • 21st Century—a 25% reduction in April
  • Auto Owners—TBA
  • USAA—offering military personnel, veterans, and their families a 20% credit for two months
  • Chubb Auto—a 35% premium reduction for April and May
  • Progressive—a 20% reduction for April and May and cancellation of non-payments through May 15
  • Geico—TBA
  • Liberty Mutual–TBA

Industry observers estimate that insurance companies stand to save around $100 billion overall from not having to pay on claims they would normally be expected to pay. State Farm announced that it expected a savings for its customers of around $2.2 billion nationwide. AG Healey told reporters that her office would be monitoring insurers to see if they are offering refunds or reductions while the pandemic persists.

State regulators that oversee insurers determine whether they are discriminating against insureds, are charging excessive rates, or are undercharging in an effort to lure insurers and suppress competition. Those insurers who refuse to give refunds or lower rates will certainly be scrutinized and may be subject to fines.  

Damages in Car Accident Claims 

Although traffic levels are down, traffic accidents still occur. Many cities and states are reporting increased fatality rates with more drivers taking the opportunity to drive at excessive speeds on uncongested highways and other roads. Increased speeds mean more severe injuries as well. 

Injury claims in car accidents usually include the following damages:

  • Past and future medical expenses
  • Past and future income loss
  • Loss of earning capacity
  • Diminished quality of life
  • Pain and suffering
  • Emotional distress
  • Spousal claim for loss of consortium

Retain a Car Accident Lawyer from Burns and Jain

If you were injured or a loved one sustained fatal injuries in a speed-related or any other type of car accident, you will need the skills and knowledge of a highly experienced car accident lawyer from the law office of Burns and Jain. Call us at (617) 227-7423 to schedule a free consultation about your injury claim.