Massachusetts drivers should see an 18 percent decrease in the cost of auto insurance, said Attorney General Tom Reilly. The recommendation, being filed today with the state Department of Insurance (DOI), would reduce the average driver’s auto insurance bill by an estimated $200 next year.
Reilly’s proposal, based on information provided by the auto insurers in the state, is significantly lower than the industry’s request for a 0.1 percent decrease, which would lower an annual insurance bill by about a dollar.
“The numbers don’t lie – drivers deserve an 18 percent rate reduction,” Reilly said. “That means $200 dollars in the average driver’s pocket. That’s real money to people who are struggling just to pay their bills.”
Reilly calculated the 18 percent decrease after a thorough analysis of the data submitted to the DOI in August. Reilly’s proposal would cut more than $750 million from current annual charges paid by Massachusetts drivers. The industry’s request would decrease costs by about $4 million.
Reilly has long fought against requests from the auto insurance industry for rate hikes. In 2001, he opposed an industry request for a rate hike, and instead, obtained a 8.3 percent decrease. In 2002, despite a request from the industry for a 7.8 percent increase, no rate hike was awarded. In 2003 and 2004, the insurance commissioner raised rates by 2.8 percent and 2.5 percent, respectively, bringing the average Massachusetts driver’s premium over the $1,000 mark for the first time in state history. Last year, Reilly filed for a 6.2 percent decrease and the insurance commissioner ultimately awarded a 1.7 percent decrease.
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