Auto insurance in Mass is a $3.9 billion industry but insurance companies still struggle to make a profit.
By Bob Kievra
The 25-page report, which was dated March 15 but released only yesterday, points to several problems in Massachusetts’ one-of-a-kind system of insuring cars. But it falls short of former Gov. Mitt Romney’s recommendation to overhaul the entire system and introduce competitive pricing in the Bay State.
The recommendations of the task force were eagerly awaited by auto insurers in Massachusetts, who have waged both private and public campaigns over the past several years that would enable insurers to set their own prices in the $3.9 billion Massachusetts automobile insurance industry, the 11th-largest in the country.
Mr. Patrick, to date, has yet to sketch out his views on the topic. In a statement yesterday he labeled the report “a meaningful first step in achieving a balance which maintains affordability throughout the Commonwealth while introducing a level of competition which will prove beneficial to all Massachusetts drivers.”
Massachusetts is unique in that regulators set rates for all automobile insurance companies, while in every other state insurers determine their own prices based on their own rating variables. Mr. Romney sought to give insurers greater flexibility in pricing their own policies, noting that 35 insurance companies have left the state since 1990, leaving only 19 insurers to write policies for the state’s 4 million drivers.
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