Martha Coakley, the Massachusetts Attorney General, has proposed new regulations that she believes will take force in sales and underwriting practices for auto insurers and agents across Massachusetts. The newly proposed regulations have been formed in response to a report published by Coakley’s office last year regarding the deregulated Massachusetts auto insurance market.
Coakley said in a statement, “We have seen some positive changes since the auto insurance marketplace was deregulated two years ago. However, there are still many improvements that should be made within the system to better protect consumers.” She believes the new proposals will increase the transparency of auto insurance to help consumers shop for better policies.
Two public hearings will be held this June on the proposed auto insurance regulations. These regulations include banning of the use of credit score to determine premiums and create rules for what statements auto insurance carriers can make while advertising prices.
Coakley’s proposal has been seen in a less than favorable light by some from the industry. Of those skeptical of the proposed regulations is Paul Tetraul, Northeast state affairs manager for the National Association of Mutual Insurance companies. Tetraul called the regulations unnecessary and ill-advised. He continued to explain:
“The underlying premises of the regulations, and the report issued by Attorney General Coakley’s office, are that consumers are not faring well under managed competition and that consumers are not protected adequately under existing regulations. Nothing could be further from the truth: the increased competition has resulted in most consumers saving money and having meaningful choices in the marketplace for the first time in decades.”