Only 2 Mass. Insurers Offering Good Driver Discounts

January 19, 2005

The number of insurers in Massachusetts looking to grant discounts to the best drivers has gone down to 2 from just 3.

Of the state’s 20 private passenger auto insurers only Amica Insurance and Electric Insurance, relatively small market forces, have sought to be able to offer drivers in the best classification, Step 9, discounts of 5 percent. Amica also wants to offer an additional 5 percent break to the safest drivers with multiple car policies.

“Commissioner Bowler has demonstrated that she is serious about fixing the anti-competitive automobile insurance system that has existed for years within the Massachusetts marketplace,” said Thomas A. Taylor, Amica president and chief executive officer. “We are in turn incorporating her work in bringing positive change to consumers, and our 2005 deviation filings reflect the anticipated savings that will come with the administration’s willingness to see through the reform effort.”

Fireman’s Fund Insurance, which offered a 2 percent good-driver discount last year, did not re-file for 2005.

The state sets uniform auto rates but permits insurers to deviate downward for drivers based on their step classification and for members of approved affinity groups. Insurers have found it increasingly difficult to offer the safe driver discounts over the past few year.

Most of the group discounts, including one by Commerce Insurance to members of the state’s chapters of the American Automobile Association, are being continued for now. However, some have questioned whether insurers would continue their group discounts under new rules limiting their ability to reinsure individual members of he groups in the residual market.

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