Mass. Auto Rates Would Fall from 8% to 18% Under Latest Proposals

The two parties representing consumers have recommended that Massachusetts auto insurance rates be slashed next year — as much as 18 percent.

The State Rating Bureau, a unit of the Division of Insurance, is calling for a statewide average decrease of about 8.3 percent. If approved, this would reduce the average rate by $85.

Attorney General Tom Reilly would cut rates more than double what the SRB is urging. His office has recommended an 18.2 percent cut, worth about $180 a year per car.

The two consumer filings follow one made by insurers themselves indicating a 3.7 percent cut is warranted. According to the industry’s Automobile Insurers Bureau of Massachusetts, its proposed reduction reflects a “substantial drop in insurance injury clams” and successful anti-fraud efforts.

But the consumer representatives feel the industry could dig deeper.

“Based on the evidence presented by the auto insurers in August, the SRB believes the automobile insurance industry’s filings of a 3.7 percent decrease is not enough for the Commonwealth’s drivers,” said SRB Director Kevin Beagan.

The SRB filing also includes a proposal for a 10 percent “continuous coverage” discount for drivers who continuously maintain coverage without any breaks in coverage for a 12-month period. The discount would not apply to those who let mandatory coverage lapse at any time during that 12-month period.

As part of this year’s rate filing, the AIB is also recommending that the multi-car discount be increased from 5 to 10 percent and that certain anti-theft device discounts be reduced to reflect actual theft experience.

AIB also recommends that towns with anti- fraud task forces have their rates lowered more quickly than the statewide average as their experience improves.

Commissioner Julianne Bowler is charged with settling the differences among the parties following a series of public hearings. Bowler must issue a decision in the rate case by Dec. 15, 2006 for rates that will be effective as of April 1, 2007.

Bowler approved an average 8.7 percent cut for this year.