Division of Insurance


Specifics on Toyota Recall & At-Fault-Accidents

Drivers who own vehicles recalled by Toyota over the past month have raised concerns about what this means for their insurance coverage and rates. Drivers who were involved in an accident prior to the recall have faced surcharges other related costs of an “at-fault-accident” that may have been due to the manufacturer’s defects and reason for recall.

Thankfully Massachusetts drivers have an appeal provision that protects these drivers from additional charges and costs of an accident due to Toyota’s recalled parts. The Board of Appeals hears approximately 50,000 cases each year, of which about half the original verdicts are reversed. Once overturned the “at-fault-accident” affecting a drivers record and increasing a driver’s insurance rates will be removed.

Drivers who wish to appeal a decision should discuss the appeal with their local agent first. Speaking with an agent will give the driver a better understanding of the terminology and may share a greater knowledge of auto insurance w to use in Massachusetts insurance carriers are required to use specific standards of fault when determining someone’s responsibility or fault in an accident. One of these standards includes the “Standard of Fault 19” in a collision that a single vehicle is involved, the fault is assessed to the person driving that vehicle. In other words if the accelerator of a recalled Toyota became stuck and the vehicle drove into a tree or other object, besides another vehicle, fault would be assessed to the driver. This is an at-fault-accident someone would want to bring to the Court of Appeals to remove this at fault accident from their record.

The Massachusetts Division of Insurance issued a Consumer Alert that announced hearings for drivers who appealed a decision prior to the recall would be reopened. The board was not previously aware of the manufacturer’s defect and is seeking to right any court decision that a Toyota driver may feel would have been different with the recall. After an at fault accident a driver should automatically receive a notice for their right to appeal the decision.

Appeal hearings are open to the public and for the most part informal. The written appeal is read by the hearing officer and the driver is then going to make his or her case for the appeal. It is also good to be aware that a representative for the insurance carrier will also be present. A person’s driving record is one of the most important determinants of auto insurance premiums. It should not be taken lightly when you are wrongly assessed fault of an accident.

Toyota Recall & Massachusetts Residents

Toyota’s freeze on the productions of popular vehicle models and recall of 4.1 million additional vehicles may be reason enough take look at your own vehicle. Toyota announced last week accelerator pedals made by CTS may stick or slowly release from a depressed position on 2.3 million U.S-built cars and light trucks, causing them to speed uncontrollably. Toyota’s public accusation was not lightly taken as CTS shares have fallen 18% since January 20th, day before Toyota pin pointed CTS as the reason for recall.

Massachusetts Division of Insurance has ruled Toyota owners who believe the cause of a previous accident was caused by the sticking CTS pedal may appeal recent and older auto insurance surcharges. The driver appealing auto insurance surcharges must be able to prove the cause of the accident was uncontrolled acceleration. Toyota drivers must also be able to prove the vehicle involved was a recalled model. If you would like to appeal an insurance surcharge know that you must lodge an appeal by March 3oth or within 60 days of receiving a recall notice, whichever occurs latest.

Toyota plans on shipping the necessary replacement parts to dealerships across the country later this week. Technicians will still need to be trained to install the essential parts however Toyota is working to solve this major safety issues as quickly as they can. This is the car manufacturer’s second major recall, the first caused by floor mat entrapment, shaking Toyota’s confidence and share of the auto market.

Department of Insurance Report

The Division of Insurance or the DOI issued an executive summary about the progress of Massachusetts change to managed competitive. Under the old system, state regulators set the insurance rates that all automobile insurance companies were allowed to charge.

The new system has generated some excitement and brought in nine additional insurance carriers to the Massachusetts market. Insurance companies can now offer competitive rates, and additional products and services. This is very beneficial to the consumer but it is also important for the consumer to do research to find the best rates.

The program has been a success overall because Massachusetts Division of insurance reported that “Massachusetts consumers saved over $270 million in insurance premiums in the first year of managed competition.” There was also a “13 percent decrease in the number of uninsured vehicles on Massachusetts roads.”

There was a lot of speculation on what the new regulations would do for insurance providers, more particularly, the agents. Fortunately for agents, “sixty-nine percent of consumers continue to purchase coverage through agents, rather than purchase directly. This number is nearly twice the national average.”

The biggest issue is that “approximately three out of four consumers indicated that they were aware of the new auto insurance system, and those who were aware were 60 percent more likely to have saved money than those who were not aware.”

It seems apparent that the system has generated positive outcomes but education and notification for residents may be an area for increased performance.

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