The Massachusetts Commissioner of Insurance has given new auto insurance carriers until December 31, 2010 to obtain their two year assigned risk exemption.
After Massachusetts changed to a competitive rating of personal lines automobile insurance on April 1, 2008, the Commissioner of Insurance issued new regulations to induce new automobile insurance carriers to enter the Commonwealth. These regulations gave insurance carriers entering Massachusetts a two year exemption from having to accept assigned risks under the Massachusetts Auto Insurance Plan or MAIP. The validity of this exemption was upheld by the Supreme Judicial Court in an appeal made by the Arbella Insurance Company.
A bill signed by Governor Patrick last week, will ban this two year exemption as of January 1, 2011. Insurance carriers that acquire the exemption prior to December 31, 2010, however, are allowed under the new law to maintain that exemption until December 31, 2012.
If you would like to learn more or have any questions or concerns on how this change in law may affect your Massachusetts insurance agency or would otherwise like to discuss any other potential legal issues please contact Owen Gallagher on his direct line at 617.598.3801.
