On the day of Christmas Eve, reports came out that Attorney General Martha Coakley vocally expressed how she felt about Massachusetts deregulated auto insurance system as she launched a scorching attack against the state’s rules on auto policies. According to Coakley, deregulated policy did not result to cost efficiency and other benefits that legislators have promised when the policy was still being drafted.
Atty. Coakley is known to lead an organization that acts as a consumer watchdog for the insurance system. In a detailed report released yesterday by Coakley, she emphasized a list of complaints regarding this so-called “managed competition” in the insurance market that came as a result of Governor Deval Patrick’s interference in the insurance system. Back in 2008, Governor Patrick started a plan that will attract investments from a massive number of insurance providers, wooing them to put up businesses in the state bringing forth stiff competition and cutting back rates by 10%. Coakley rattled off a list of complaints that mainly point out on the “managed competition” failing to meet its purpose.
Included in the sharp complaints are the following:
• system is not transparent enough for motorists
• insurance providers are now beginning to use information not related to a motorist’s driving records in setting premium rates
• discounts that consumers are supposedly entitled to are not being received as certain discounts are not offered by insurance providers
• some good drivers are denied of auto policies for shallow reasons such as having a permanent residence in urban areas
Coakley’s most spiteful criticism was that the competition did not result to any savings in cost that was promised and that a number of auto insurance companies are actually raising premium charges. Coakley even mentioned in a recent press release that this system as previously regulated might have been more effective in producing more affordable prices for car drivers.
Coakley’s office recently released a statement saying that while the long-run effects of this new system is still yet to be seen, they are very much worried that vehicle drivers may not be receiving the best quotes, cheap premiums, and quality protection they truly deserve.
Experts say that the reports and statements released by Coakley are very harsh on the issue, pointing out so many criticisms and citing very little praise, even containing very frank criticism of Governor Patrick’s administration. However, Coakley said that she backs up the deregulation in the insurance system, but she wants to see a major overhaul and a number of improvements happen.