Massachusetts Settles with Five Auto Insurers over Unreported Appeals

Five more auto insurers in Massachusetts have reached settlements with the state’s attorney general over their failure to update at-fault accident information for drivers whom they insure.

The companies involved in the settlements are Metropolitan Property & Casualty, Liberty Mutual, Peerless, Plymouth Rock Assurance Corp., and Pilgrim. Earlier this month, the state’s largest auto insurer, Commerce, reached a similar settlement.

At issue is the way companies report – or in these cases, fail to report – updated information about a driver’s accident history. The insurers involved in the settlement were required to update accident records for drivers who were determined by the board of appeals to be at-fault at an accident. By law, all insurers must report that information to a private, third-party data collection company – the Comprehensive Loss Underwriting Exchange, or CLUE – since that information is used to determine premiums.

The insurers have all agreed to reform their at-fault reporting practices and will update private database information whenever one of their at-fault findings is overturned by the board of appeal. The companies have also agreed to notify the insurance companies which currently insure the affected drivers to ensure that those insurance companies re-rate those drivers accordingly.

The insurers will also make payments totaling over $100,000 to the state.

“The Board of Appeal plays an important role in protecting consumers by reviewing and independently determining the fairness of at-fault accident determinations made by insurance companies,” Attorney Martha Coakley said. “If this problem had not been caught and corrected, this incorrect data might have plagued consumers and inflated their premiums for years to come.”