The following statement may be attributed to Paul Tetrault, Northeast state affairs manager for the National Association of Mutual Insurance Companies (NAMIC), on the announcement that Massachusetts Attorney General Martha Coakley has proposed new regulations for the state’s auto insurance market.
“The sweeping set of new regulations put forward by Attorney General Martha Coakley are unnecessary and ill-advised, to say the least. 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. Both anecdotal evidence and quantitative polling have shown the move to managed competition to be extremely popular among Massachusetts drivers. And consumers are well protected by existing laws and regulations; the Massachusetts Division of Insurance has done a commendable job of overseeing a smooth transition to managed competition.
“The newly proposed regulations have to be viewed in historical context: for decades, the Massachusetts auto insurance market suffered from the effects of excessive regulation. The move to managed competition was a progressive step forward, and the results have been predictably favorable. Several insurers that were previously unwilling to do business in Massachusetts entered the market, enhancing competition and providing consumers with more choices. Insurers already in the market lowered rates for good drivers and developed product enhancements. It is disconcerting to consider what the effects of imposing a new set of regulatory restrictions, requirements, and penalties on insurers may be.
“Massachusetts already has strong statutes and regulations that afford a high level of protection for insurance consumers. There is simply no need for additional regulations. Attorney General Coakley has been a critic of the move to managed competition since it was first put forward by the Division of Insurance. It would be legitimate to consider whether these new regulations are being proposed for no other reason than to bolster the AG’s role in the oversight of insurance. If so, consumers may be caught in the crossfire of a battle over bureaucratic jurisdiction.”
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Northeast State Affairs Manager
Posted: Friday, May 28, 2010 10:29:18 AM.
317.875.5250 - Indianapolis | 202.628.1558 - Washington, D.C.