Maryland targets urban auto rates

Maryland, seeking to address the higher costs of insurance for urban drivers, recently passed legislation to require insurers to regularly review their rating territories and streamline the process for protesting rates.

But some other recommendations of a recent urban insurance report have yet to be adopted.

Maryland Insurance Commissioner R. Steven Orr issued the final report of the Automobile Insurance Task Force to Study Rates in Urban Areas, which was formed in 2005.

Certain recommendations of the task force will be implemented as a result of legislation passed during the 2006 session.

Insurance companies will now be required to affirmatively state in each rate filing that the territories they are using and the rates for each territory are actuarially justified. (HB1600 and SB965).

Also, a new law requires that rules for protesting rate increases be clarified and streamlined. (HB760 and SB 948)

The task force also offered other recommendations that were not addressed by legislators. These included allowing the Maryland Automobile Insurance Fund to accept installment payments from its insureds and permitting insurers to create and introduce pilot programs for urban drivers.

The task force also urged but legislators never acted on a bill making personal injury protection payments secondary to health insurance or other sources of recovery; reducing uninsured motorist benefits by the amount of compensation paid or payable from collateral sources; and reducing recoveries from third party liability insurers on third party liability claims or judgments by the amount of compensation paid or payable from collateral sources.

Topics Auto Legislation Maryland