The Attorney General completed its review of the 31 initiative petition submitted for the 2012 ballot yesterday, approving all but eight of the 31 petitions which included 30 proposed laws and one proposed constitutional amendment. Among those ballot initiatives approved was No. 11-13, entitled An Act Banning the Use of Socio-Economic Factors for Insurance Underwriting and Raing of Motor Vehicle Liability Insurance, presented by the MAIA and its President Francis Mancini.
As Agency Checklists reported in an earlier article, the MAIA’s Ballot Initiative seeks to “…prohibit insurance companies from using a person’s credit score, occupation, or level of education as factors in underwriting and rating of private passenger automobile insurance. While Massachusetts has longed banned this practice, the MAIA’s ballot initiative seeks to require a General Law to regulate what an automobile insurer can use in establishing and applying their individual rate filings under the competitive rating statute.
In addition to filing the ballot initiative with the Attorney General’s office, the MAIA earlier this year filed Senate Bill No. 461 entitled An Act banning the use of certain socio-economic factors for insurance underwriting and rating of motor vehicle liability insurance. That Bill is currently referred to the Joint Committee on Financial Services. As Mr. Mancini explained, the MAIA felt it was vital to take this two two-pronged approach in order to get this law passed. “While we remain focused on passing this important bill through the legislative process, we felt it was essential to keep all avenues open to us.”
Currently in Massachusetts, there are only administrative regulations that the Division of Insurance has issued for competitive rating of automobile insurance which incorporate the statutory prohibitions and add the additional prohibitions against using “creed; national origin; religion (sic); income; education; and homeownership” as rating factors for underwriting decisions. In addition, there are competitive rating regulations that specifically prohibit the use of a “consumer report obtained from a consumer reporting agency” for rating or underwriting automobile policies. Without formal legislation to the contrary, however, the MAIA contends that the state insurance commissioner has total discretion to amend those rules at any time after conducting a public hearing. While the current Insurance Commissioner Joseph Murphy has indicated it is not his intention to amend the regulatory prohibitions in place, the MAIA believes that a statutory prohibition would be a safer long-term solution.
“A person who decided to become a plumber or carpenter should not have to pay more for their auto insurance simply because they chose not to go to college or obtain a graduate degree,” argues Mancini. “There is simply no place for this type of class warfare in our auto insurance system.” Moreover, Mancini continues, “Using these factors to set auto rates is simply unfair, discriminatory, and unreliable. Two people living in the same neighborhood with identical driving records should not be charged different rates because one lost their job or fell behind on their medical bills.”
Now that the MAIA’s Ballot Initiative for 2012 has been certified, it will progress to the next step of the certification process which requires that the organization obtain the signatures of 68,911 registered voters by December 7th in order to have the initiative placed on the November 2012 ballot.
