New Auto System in MA Put to the Test as Rates are Set to be Released
Massachusetts drivers are set to see whether they will pay less for auto insurance next year. Auto insurers are set to release their proposed rates, and consumers will find out whether greater competition will relieve demands on their finances.
Up until now, Massachusetts was the only state where regulators, not the market, set car insurance rates. Only 19 companies write auto policies in Massachusetts, whereas in most states, drivers can choose from 100 or more insurers.
The last time the state tried to create a competitive system 30 years ago, it was a disaster. The system was scrapped after some urban drivers saw their rates triple.
This time, the most that rates can rise on the worst drivers is ten percent.
State regulators hope the new system will mean better rates for good drivers. They also believe companies will be prompted by competition to provide better service.
Published on November 19, 2007
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