Insurance News


Massachusetts Division of Insurance Issues Warning

The Massachusetts Division of Insurance has issued an official warning to all auto dealers in the state. Salespersons are told to watch what they say and do regarding auto insurance while selling a vehicle. Joseph Murphy, the Massachusetts Commissioner of Insurance, published a letter addressed to all auto dealers and salespersons on the Consumer Affairs and Business Regulation website.

Murphy states numerous reports have been filed with the Division of Insurance that certain motor vehicle salespersons are giving recommendations about particular insurance companies and assisting customers in purchasing their auto insurance.  He warns that only licensed insurance producers are given the authority to sell or attempt to sell, negotiate or solicit insurance, including motor vehicle insurance. The letter stated:

This Bulletin reminds insurance companies and those individuals involved in the sale, finance, registration or insurance of motor vehicles of the Massachusetts rules about placing insurance on motor vehicles.  These rules reflect the longstanding principle that only those who have demonstrated knowledge and competence about motor vehicle insurance by obtaining an insurance license from the Division are permitted to advise consumers about the purchase of such coverage.

The posted bulletin gives these five specific examples of what an auto salesperson may not do while selling a motor vehicle:

Example 1:  A motor vehicle salesperson advises a customer that he could save money by buying his motor vehicle insurance from The XYZ Insurance Company. The salesperson is improperly “soliciting” motor vehicle insurance because she is recommending or urging a person to apply for a motor vehicle insurance policy from a particular company.

Example 2:  A motor vehicle salesperson assists the customer to obtain insurance online by using his office computer to search for motor vehicle insurance for the customer while the customer watches. The salesperson is violating Massachusetts insurance law because he is “negotiating” motor vehicle insurance for the customer by assisting the customer to “obtain” it.

Example 3:  A motor vehicle salesperson offers her customer the use of a computer at the motor vehicle dealership so that the customer can search for motor vehicle insurance, but the computer is preset to the website of a particular insurance company. The salesperson is improperly “soliciting” motor vehicle insurance because she is asking or urging a person to apply for insurance from a particular company.

Example 4.  A motor vehicle salesperson who is arranging financing for the purchase of a motor vehicle tells his customer that she must purchase insurance from a particular insurance company. The salesperson is violating Massachusetts law because he is making financing contingent on purchasing insurance from a particular insurance company.  G.L. c. 175, § 193E.

Example 5:  The motor vehicle dealership maintains a computer terminal linked to the internet for the use of its customers. A customer may use the terminal to search for insurance as long as the salesperson does not operate the computer, the computer is not preset to any particular insurance company’s website, and the salesperson does not recommend that the customer apply for motor vehicle insurance from a particular company.  The salesperson may suggest that the customer start her search for motor vehicle insurance by visiting a site that provides general advice on the purchase of such insurance.  A salesperson may always refer her customer to The Division’s website, www.mass.gov/doi for such information.

This is a firm reminder not only to auto salespersons, but consumers as well. Only a licensed agent holds the knowledge necessary for insuring you with appropriate limits. The deregulation of the auto insurance market has given consumers the option to compare quotes and find the best price, not to be bullied into signing with one insurance carrier or another. For a free quote call MassDrive where a friendly representative will compare quotes from different carriers for you!

To read Joseph Murphy’s letter regarding the involvement of motor vehicle salespeople in the solicitation, negotiation or sale of motor vehicle insurance please access the Consumer Affairs and Business Regulation website here.

Breaking down the facts on Auto Insurance

Auto insurance can be complicated but it is very important that you know all the details.  A recent article published by MSN money breaks down the basics of auto insurance.

  • If you have good credit, you’ll pay less
  • Your car model affects your premium
  • Pay in full to avoid installment fees
  • Personal property within your vehicle is not covered
  • Bad driving leads to higher rates
  • If you lend your car out and something happens, you’ll be the one to pay
  • The value of your “totaled” car may surprise you
  • Check into “diminished value”
  • Taxes can still be owed on a replacement car
  • Wait to add your teenager to your policy until he or she is licensed
  • Officially cancel your insurance policy when you switch insurers

When shopping around make sure to keep these points in mind because they may end up saving you money annually.  MassDrive would like to help you in your efforts! MassDrive is excited about the competition that deregulation has created and we would like to pass on the savings to you.  Our licensed professionals can compare policies from multiple carriers and give you a better understanding of the benefits of each plan!

Progressive Falls Behind

Flo, the popular Progressive personality, will bring higher premiums with her quirky commercials and price zapping gun this quarter. Progressive entered the Massachusetts auto insurance market two years ago with rates attractively lower than most competitors. The lower premiums however have not endured as Progressive raises their rates for a fourth time since their debut in 2008. The new price increase of 6.63% will raise prices a grad total of about 16% over the last two years.

Andrew Quigg, a Progressive executive in charge of the company’s Massachusetts business states,”We’re still very competitive… Thousands of consumers still shop around and find us to have the lowest cost for auto insurance.” Even so, Progressive has become less and less attractive to the Massachusetts driver as time continues to provided a history of constantly increasing premiums. If these price increases continue to follow their repetitive pattern, Quigg’s statement is unlikely to remain true for long.

Insurance commissioner Joe Murphy told the Boston Globe he believes the deregulated auto insurance market, “has been wildly successful.” And successful it has been. The Massachusetts Division of Insurance reports drivers saved $270 million in the first year of deregulation. Eleven new insurance carriers have entered the Massachusetts auto insurance market since the new system emerged. Before deregulation insurance rates were set by the government and depended upon the driver’s location and driving record only. The new market allows insurance carriers to offer discounts from holding a AAA membership to owning a home. Deregulation holds great potential savings for drivers state wide.

Some critics of the newly deregulated system find it difficult to compare prices through the plethora of new auto insurance carriers. Adjusting to a new system may difficult for some, however it does not have to be difficult for you. MassDrive Direct Auto Insurance understands you have better things to do with your time than compare auto insurance quotes while understanding it is an important process. Here at MassDrive we quickly gather your basic information and compare auto insurance quotes for you!

No longer will you need to worry about comparing rates, coverages between quotes, or stress about discounts – MassDrive has your back. We compare quotes through various Massachusetts insurance carriers helping you find the best price and saving you time. One carriers may offer discounts another does not, in comparing your information through various carriers we help you get the most bang for your buck. And the best part? The quotes are completely free! Give MassDrive a call, one of our friendly representatives will compare your quotes saving you time and money.

Mileage Tax for Massachusetts Drivers?

With the current problem of roads deteriorating and state funds continuing to decline, something must be done. Nothing is set in stone, but Massachusetts is looking into a mileage tax programthat is currently being tested in Oregon. The concept is credited to Intelligent Transportation Systems in Washington DC. Scott Belcher, the CEO of the company believes their new technology is the solution to the country’s transportation problems.

The program would provide a way to tax drivers based on the amount 0f mileage driven versus increasing gas tax.  If the gas tax is increased, individuals who drive gas efficient vehicles will be affected less, and those who drive standard vehicles will make up for the savings of the gas efficient cars.

The proposed program would require that all vehicles install a GPS chip that would track distance traveled.   All gas stations would be fitted with wireless electronic readers to record mileage.  When filling up, the electronic reader would calculate the tax and apply it to the gas bill.

Senator Brown has already spoke up against this new form of taxation but only time will tell if there is a future for mileage tax in Massachusetts.

Murphy New Insurance Commissioner

Joseph Murphy has been named the new Commissioner of the Massachusetts Division of Insurance. He has acted as commissioner since September 2009 after Nonnie Burnes resigned from the position. Serving as first deputy of commissions since 2006 he has played an active role in the transition to managed competition. However this is not his only qualifying position, Murphy has also served as: chief of staff and research director of the Joint Committee of Financial Services and the Joint Committee on Insurance in the Massachusetts legislature.

Murphy Massachusetts Governor Deval Patrick appointed Murphy to the position. Deval publicly recognized Murphy for his outstanding role in the administration’s auto insurance deregulation and day to day operation of the division including its 130 employees and $12 million budget  since Burne’s resignation.

“Joe deserves a significant amount of credit for the success of managed competition and is a leader in our efforts to stabilize health insurance costs for small businesses. He has a keen understanding of the issues that matter to consumers and insurers alike, and will use his knowledge and experience to help us move forward on auto insurance reform, health care cost containment and a host of other initiatives.”

Governor Deval Patrick

You Don't Have to Settle, It's Time to Shop Around!

As you may have heard, recent studies showed that coverage costs did not decrease in Massachusetts after deregulation of the market. Although an increase in insurance carriers in Massachusetts has allowed for more options, many drivers are sticking with their current plans. I’m here to tell you that you don’t have to settle for a plan you are unhappy with!

Here at MassDrive we understand that reading through multiple insurance policies is not the best way to pass time. That’s why we are dedicated to doing the work and helping you find the best insurance company, with the best coverage, at the best price, for all your needs.

Massachusetts Housing Market Recovering

A four year decline in the housing market came to a halt this past December. According to a new report by The Warner Group single-family home sales increased from 40,356 in 2008 to 41,583 home sales in 2009. Although the median purchase price of homes continued to drop 6.6 percent, the decline was not as steep as the 11 percent fall in 2008 and the 10.6 percent drop in 2007.

“The latter part of 2009 gave us some clear signs that the housing market is stabilizing and heading for a recovery, and while prices were still falling the percentage drop last year wasn’t as steep as it was in the previous two years. What’s more, December was the first month in more than two years that the monthly median home price climbed year-over-year. The improving economy and the home buyer tax credit definitely helped fuel home sales.”

-Timothy T. Warner Jr., CEO of The Warner Group

First time homeowners seem to be jumping at the opportunity to save up to $8,000 on new homes. A first time homeowner is defined as someone who has not owned a primary residence in the past three years. However it is important to recognize repeat homeowners may receive up to a $6,500 credit as well. To qualify for the federal tax credit as a repeat homeowner a person must have owned and lived in the same residence for a minimum of five consecutive years during the past eight years. For more information on the federal housing tax credit visit the official website at: www.federalhousingtaxcredit.com.

When purchasing a new home another key purchase, required by most mortgage companies, is homeowners insurance. With purchasing a new home come many payments, bills, and debt. A great way to save on homeowners insurance is to bundle it in a companion policy with your auto insurance. For a quick free quote bundling auto and homeowners insurance together give MassDrive a call.

Safety Insurance Settles with Attorney General

Safety Insurance Group announced yesterday January 14th 2010 it has reached an agreement with Attorney General Martha Coakley in the dispute over quoting motorcycle premiums. Safety’s settlement will backdate to certain types of coverages written on motorcycle insurance to Safety to January 1, 2002. If a customer has overpaid a premium with the new resolution since January 1, 2002 a refund will be made to the policy holder. If a customer paid a premium less than what would be determined by the standing agreement between Safety and the Attorney General additional premium will not be collected.

“Although we disagreed with the Attorney General on a number of points, we believe that after extensive discussions Safety has arrived at a resolution of the issue and an agreement with the Attorney General’s office that provides for the best interests of Safety’s policyholders. Safety had followed standard practices generally used by many Massachusetts insurance companies to calculate appropriate premiums for motorcycle coverages. It cooperated fully with the Attorney General’s review of those industry-wide practices and participated in the development of the new method.”

-Peter Rice, Safety’s outside council

Things to keep in mind while shopping around

While reviewing your insurance there are a few things you want to keep in mind. Make sure you know if there is going to be any changes from your old policy to your new one. You don’t want to lose coverage; the point of shopping around is to get you the best coverage while still getting you a better price. Are you receiving the proper discounts that match your specific situation? Many insurance companies offer discounts depending on a variety of factors. Some discounts are required by law and others are optional for insurance carriers. In addition, two carriers may offer the same discounts but the amount of that discount could vary from carrier to carrier.

At MassDrive you will not only find professionals in the insurance field that can answer all of your questions with your interests in mind. You will also find a variety of resources available to you as a Massachusetts auto insurance consumer. Our goal is to find every Massachusetts customer the right policy at a price the driver can afford. Our only focus is Massachusetts and because we’re Massachusetts drivers ourselves, we feel a responsibility to deliver results to you.

Who's Auto Insurance Covers Me?

Now that you’ve purchased auto insurance, you may be wondering “what exactly does it cover?” Check out the commonly asked questions below to get a better understanding of your auto insurance:

Can I drive a friend’s car?

If you borrow the car with a friends permission, and they insure the vehicle, yes! If you friend has not insured the vehicle make sure your auto insurance has sufficient coverage and you should be good to go.

What if I’m driving a friend’s car and involved in an accident?

The vehicle owner’s insurance is considered the primary auto insurance policy. In other words, is someone else owns and insures a vehicle you are driving, their policy will pay in the event of an accident. However if your friends auto insurance does not have sufficient coverage your auto insurance policy will kick in and cover – up to your policy limits – what is left to pay. For example let’s say you cause $10,000 worth of damage and your friend’s insurance policy will only pay up to $8,000 of the damage. Your auto insurance policy will pay the remaining $2,000 of damage if the charges are within policy limits.

What if I borrow someone’s car with out permission?

If you fall under this category and find yourself pulled over or in an accident you will be facing serious consequences. If you’re pulled over without the vehicle owner’s permission you may be facing criminal charges. If you are involved in an accident while using an auto without permission not only will you be facing criminal charges but paying all damages out of pocket.

Can I borrow my vehicle to someone on a regular basis who does not have insurance?

Unless a person using your vehicle on a regular basis is added to your policy as an occasional driver, chances are they will not be covered. The main idea behind this is for someone who is going to be regularly driving a vehicle to be either added to your policy or purchase one of their own.

What if my car is involved in a hit-and-run?

If your vehicle is involved in a hit-and-run, and you did not do the running, you may be able to collect from your own insurance agency. However only if you have purchased uninsured motorist coverage. If you have this coverage your insurance will pay up to policy limits the amount of damage done to your vehicle. This type of coverage is a key part of any insurance policy involving a hit and run or accidents when other drivers involved are not insured.

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