Four more auto insurers have reached a settlement with Massachusetts’ attorney general to correct thousands of driving records as officials now turn their attention to the use of private databases for rating purposes.
Martha Coakley
Massachusetts Attorney General Martha Coakley announced a deal with Arbella Mutual Insurance Co., Norfolk & Dedham Mutual Fire Insurance Co., United Services Automobile Association (USAA) and Electric Insurance Co., related to alleged violations of a state board of appeal enforcement initiative.
The insurers were accused of violating the state’s 2009 board of appeal statue by failing to correct at-fault accident findings reported to private data collection companies after those at-fault accident findings were overturned by the board.
The four insurers have agreed to comply with the ruling, make payments to the state of more than $100,000 and correct the at-fault accident findings reported to private data collectors. The settlements also require the four companies to report these corrections to insurers who actively use information from private databases to calculate premiums for Massachusetts’ drivers and pay any driver surcharged as a result of an at-fault report that should have been corrected, according to Coakley’s office.
In a statement, Coakley said if the problem had not been caught and corrected, “these at-fault reports could have resulted in premium overcharges to Massachusetts drivers for years to come.
“We are pleased that the settling insurers cooperated with our review and agreed to reverse their at-fault reports,” she said. “As we go forward in this new auto insurance marketplace, our office will continue to work to protect consumers from unfair rating practices. If a driver was not at-fault for an accident, insurance companies should not calculate that driver’s insurance premium as if the driver were at-fault.”
In October 2009, an investigation began after a consumer complaint allegedly overcharged by GEICO based on an at-fault finding that Commerce Insurance Co. failed to correct following the state board of appeal’s finding. In February, Coakley’s office reached similar settlements with Commerce Insurance Co., Metropolitan Property & Casualty, Liberty Mutual Insurance Co., Peerless Insurance Co., Plymouth Rock Assurance Corp. and Pilgrim Insurance Co.
In total, Coakley’s office estimates that 10,000 drivers’ records in Massachusetts will be corrected.
Coakley said the next phase of her investigation is to examine whether the insurers now using private databases for auto insurance rating purposes are making appropriate use of that data and if they are respecting the board of appeal’s determinations in calculating their customers’ premiums.
Mass. AG settles with four more insurers over at-fault accident reports via IFAwebnews .