AIA Applauds Massachusetts Assigned Risk Plan

Boston, TX - The assigned risk plan being implemented by Massachusetts Insurance Commissioner Julianne Bowler will provide a fair and transparent system for insuring high risk drivers, according to the American Insurance Association (AIA).

"The residual market system has become a roadblock to writing auto insurance in the Commonwealth," said John Murphy, AIA vice president, Northeast Region. "It favors some insurers over others."

Murphy pointed out that the attorney general concluded months ago that the current system does not meet the statutory mandate for a fair and equitable sharing of residual market losses.

"AIA looks forward to the implementation of the assigned risk plan in January. It will send an important positive signal that Massachusetts is serious about normalizing its auto insurance system," added Murphy.

"Fixing the residual market by establishing an assigned risk plan is a critical first step in auto reform. AIA believes further reform to re-introduce competition is also needed to create a vibrant auto insurance market that will benefit consumers. We hope Governor Patrick will embrace this effort to give consumers greater price and product choice," said Murphy.

"This plan is the result of years of deliberate planning, hearings and review. It brings Massachusetts in to the mainstream with a system already in place in 43 other states," added Murphy.

SOURCE: American Insurance Association