Mass. Gov. Romney to Unveil Own Auto System Proposal

By | June 1, 2005

Reportedly tired of waiting, Gov. Mitt Romney will today announce a legislative reform package for the Massachusetts auto insurance system, bypassing his own task force that had promised to come up with its own measures by now after more than a year of meetings.

Romney has scheduled a press conference for this morning. Details of his package were not announced but in previous statements he has expressed a desire to find ways to make bad drivers pay more while good drivers pay less and encourage more choice and competition in the marketplace.

The task force appointed by Romney last spring issued a preliminary report in March but offered no consensus on how to proceed legislatively. That report concluded that the state’s private passenger auto insurance system is heading for a crash and promised to produce a legislative reform package by May 30 in time for consideration this legislative session.

The task force is comprised of key legislators and administration officials, including Insurance Commissioner Julianne Bowler and a representative from the office of Attorney General Tom Reilly, who is poised to run against Romney for the governor’s office. The task force, while drawing the conclusion that reform is needed, has apparently been unable to reach a compromise on how best to proceed.

“Our review of the Massachusetts marketplace has identified ongoing problems that hamper the ability to achieve meaningful consumer choice,” the interim report stated. As evidence it cited the fall in the number of carriers from 53 in 1990 to only 19 today. That reduction in the number of insurers has taken place while the number of licensed vehicles has jumped by 20 percent. Five of the 19 carriers write 70 percent of the market.

The members of the task force have held more than 18 meetings with various industry, consumer, regulatory, law enforcement, trial bar and even auto parts and chiropractic representatives since getting started last April. They missed the original year-end deadline for issuing recommendations.

One of the major peices of insurance reform touted by Romney’s administration, an overhaul of the current residual market, is currently held up in court. Commerce Insurance Co. and other opponents of the new plan have complained that the insurance commissioner exceeded her authority in promulgating the reorganization.

Was this article valuable?

Here are more articles you may enjoy.