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.