The Massachusetts Association of Insurance Agents is calling on its members and consumers alike to throw their support behind a new bill that would require all insurers to full review an applicants driving history prior to issuing a quote for auto insurance. Known as H. 3682 “An Act relative to fair and accurate motor vehicle insurance quotes”, the Bill is aimed at requiring all insurers to verify each and every applicants driving history via a non-biased third party database prior to “…providing a quote or accepting a down payment for an auto insurance policy.”
This legislative initiative, which is the MAIA’s priority legislation this session, is in response to various complaints from MAIA members with regards to the practices of certain direct writers. In particular, the Association says that for the majority of Massachusetts carriers and agents there is no issues, some MAIA members are decrying the tactics of certain direct writers that are quoting premiums and accepting down payments based solely on an applicant’s self-reported driving history.
The MAIA says that only later, after an applicant has become an insured, do these same direct writers actually review the customer’s driving history. As a result, it is only after becoming a client does the insureds rates raise accordingly. The result, concludes the Association in its newsletter, is a “bait and switch” tactic which dupes the consumer while putting agents competing with the direct writer at an unfair competitive advantage. As a result, H. 3682 was drafted to address this issue.
What the new Bill actually says
For those interested in reading the Bill, it is very succinct and to the point. Agency Checklists has provided a copy of it here for our readers to review:
Chapter 175 of the General Laws is hereby amended by inserting after Section 4E the following section:
Section 4F. No insurer who utilizes an applicant’s driving history as a rating or underwriting factor for private passenger motor vehicle insurance in the Commonwealth shall provide a quote to an applicant, or accept a down payment for a policy, without first verifying said applicant’s Massachusetts driving history through the use of a reliable third party database.
A hearing on the Act will likely take place after the Fourth of July
The MAIA is anticipating a hearing H. 3682 on July 11th she it goes before the Joint Committee on Financial Services. As such, the Association is asking member agents as well as insureds to get in touch if they have been involved with this type of “bait and switch” situations. With the hearing fast approaching, the MAIA is asking any affected persons to get in touch with their personal experiences in order that the Association can share these “concrete examples” from agents and consumers during the Legislative hearing on the matter.
How to share your story with the MAIA
With the hearing fast approaching, the MAIA is asking all agents or consumers, who have been affected by these types of unfair competitive practices, to contact the MAIA’s President & CEO Nick Fyntrilakis directly. He can be reached either via his email at firstname.lastname@example.org or by telephone at 508-634-7352. Personal experiences can be shared in a letter, in a meeting with the MAIA directly, or even via a media interview. As the MAIA explains in its newsletter, “Such testimony will personalize the issue and demonstrate for legislators how this practice hurts the consumers and local businesses in their districts.”
For those interested in reading the Association’s recent article on this legislative issue, please refer to the June 20th edition of the MAIA’s MassAgent Newsletter here.