A former director of the State Rating Bureau (SRB) within the Massachusetts Division of Insurance and frequent critic of the industry and its regulators has signed on to be executive director at the Center for Insurance Research (CIR), a watchdog group that tracks insurance consumer issues and policy.
D’Amato served under several administrations including seven years as the head of the SRB, most recently with former Insurance Commissioner Linda Ruthardt. He resigned in 1998 because he felt .she was too cozy with the industry. He began this week at his new job at CIR in Cambridge, Mass.
Since then the Harvard Law School graduate has been an outspoken critic of state regulation and various auto insurance and workers compensation practices.
The center is known nationally as a fierce opponent of major insurer demutualizations including the John Hancock one under its former founder and director, Jason Adkins.
Last summer, D’Amato, the center, and other consumer groups were involved in a successfull effort to sidetrack regulations proposed by Massachusetts Insurance Commissioner Julianne Bowler that would have allowed homeowners insurers to use credi reports in rating policies.
Bowler has since said she is waiting for a federal study of credit scoring before revisiting the credit scoring issue.
D’Amato told Insurance Journal he is not limiting the center’s menu of issues and that Massachusetts auto insurance system will continue to be one on which he will speak out. In a press announcement, he outlined the center’s agenda in the upcoming months:
“• Inadequate auto insurance reforms that fail to focus on the most effective ways to lower rates. For example, in Massachusetts, safety should be the priority because for decades the state has led the nation in accidents per car on the road;
• Discrimination in the pricing of insurance, including the ‘passive’ discrimination of ignoring well-accepted actuarial refinements that would lower insurance rates for minorities and low-income consumers;
• Unfair exclusions in insurance policies that shift potentially catastrophic costs to a few individuals instead of spreading those costs over a large population of consumers;
• Insurance company misconduct that deprives policyholders of their rights during mergers, acquisitions, and other corporate dealmaking;
• Failures in regulatory oversight of insurers both statewide and nationally; and
• Alarming federal proposals to deregulate insurance rates.”
D’Amato also announced a new initiative both to connect with consumers who have problems with their insurance companies and to build a national infrastructure of professionals to assist consumers.
“Starting today, we’ll be looking actively for consumers with specific grievances against the insurance industry,” D’Amato said.
The group just issued the first of what D’Amatao said will be periodic appeals to consumers asking for information on certain insurer practices. This first so-called “Consumer Call” was sent to homeowners and auto insureds concerned over the use of credit scoring.
“If you believe insurers are using information about your credit history to charge you higher rates or to cancel your insurance policy, we want to hear from you. Also, if you live in a coastal area such as Cape Cod and your insurance has been canceled or your rates have gone up substantially in recent months, contact the center,” D’Amato said.
Consumers have been urged to phone at (617) 441-2900 or e-mail CIR at cir@TheWorld.com.
D’Amato said the center will also be creating a national network of insurance professionals — including actuaries, economists, attorneys, and brokers — to serve consumers who believe government has failed to protect them.
“There’s a huge void that we can fill,” D’Amato noted. “As government has shrunk over time, insurance regulators nationwide have scaled back their consumer protection activities. For example, when I started at the Massachusetts Division of Insurance in 1986, the agency was known nationally for actively pursuing issues on behalf of consumers. But severe cutbacks in staffing, and the agency’s current pro-insurer bias, have left consumers largely unprotected in numerous areas. The center will step in where regulators fear to tread,” he said.
D’Amato joins Brendan Bridgeland, the center’s policy director and staff attorney, on the CIR staff.
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