Keep auto appeals board

The state's auto insurance reform measures have benefited consumers, but the dissolving of the Division of Insurance Board of Appeals on April 1, as advocated by insurance commissioner Nonnie Burnes, would constitute a step backwards. We support efforts in the Legislature to pass a bill protecting the appeals board. The "managed competition" system implemented last year meant that Massachusetts was no longer the only state in the union in which car insurance rates were dictated by government. Commissioner Burnes argues that with the introduction of competition there is no longer need to provide drivers with a place to contest auto accident surcharges, but she is overstating the benefits of competition.

"Managed competition" means that the system is not fully competitive, and as long as it is not, an avenue for appeals must be kept open. Ms. Burnes' assertion that drivers unhappy with surcharges can simply move to an insurer with a more lenient policy assumes that companies differ dramatically in the way they handle accidents, which is not necessarily the case. "The accident follows you," Frank Mancini, the president of the Massachusetts Association of Insurance Agents and a supporter of the appeals board told The Boston Globe. "It doesn't go away if you move to another insurer."

Ms. Burnes proposes that the insurance companies provide two reviews for customers unhappy with their surcharges, but we don't see the companies reversing decisions in favor of drivers too often. If we have learned anything in recent months it is that government must provide oversight of industry, and that applies to the auto insurance industry as it does business in Massachusetts.

news source : http://www.berkshireeagle.com/