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Surcharges under new MA auto insurance law

Is it true that under the new Massachusetts auto insurance law companies can no longer add surcharges for accidents and tickets?

Editor's response

Yeah, you wish. The changes to the Massachusetts auto insurance law you reference will take effect when consumers buy or renew policies after April 1, 2008. The new system, called "Managed Competition," will allow insurance companies, for the first time, to set their own prices and establish their own coverages and discounts.

Massachusetts law used to require specified surcharges for certain accidents and traffic violations. Under the new law, insurers will be permitted to establish their own rules for surcharges, or 'merit rating plans.' The insurers will determine whether to impose surcharges or not. Of course, in this new world of free competition (to be closely monitored by the Attorney General of Massachusetts) companies that do not impose surcharges may charge higher premiums. For an excellent summary of the changes in the law, go to the Massachusetts AG's web site and look under 'Consumer Protection." http://www.mass.gov/?pageID=cagohomepage&L=1&L0=Home&sid=Cago

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