MAPFRE Denied Injunction Against AAA Auto Insurance Sales in Massachusetts

MAPFRE Insurance has been denied a preliminary injunction to keep AAA Northeast from selling auto insurance policies in Massachusetts in what the insurer says is a violation of an exclusive marketing agreement it has with the auto club in the state.

Superior Court Judge Kenneth W. Salinger found that the insurer failed to provide evidence to support its claims of harms it would suffer if AAA were not blocked from selling right away.

The judge noted that a preliminary injunction “must be denied” where money damages would adequately compensate for any harm that a plaintiff may suffer before final judgment is entered.

MAPFRE, the biggest auto insurer in Massachusetts, is at odds with the AAA Northeast division because the insurer says AAA is violating an exclusive 20-year joint marketing agreement that is worth $200 million a year in premiums to the insurer.

The insurer sought a preliminary injunction to halt any sales by AAA Insurance Agency, claiming that it would suffer damage to client relationships, its reputation, and customer goodwill.

But the judge said the insurer did not explain what it wants the injunction to do, did not provide evidence of the harms it said it would suffer, and did not show any harm that could not be remedied with a monetary settlement.

AAA Northeast maintains that no agreement as described by MAPFRE has existed since 2008 and that it has openly sold the automobile insurance of other insurers– including Travelers and Arbella– alongside MAPFRE’s automobile insurance.

Even if MAPFRE’s claimed injury were legitimate, the case is “classic monetary damages, not irreparable harm,” according to AAA.

The judge agreed, noting that a preliminary injunction must be denied where money damages would adequately compensate for any harm, no matter how likely it may be that the plaintiff will prevail on the merits.

Topics Auto Massachusetts