Bill > S480

This bill establishes a special working commission composed of representatives from the Office of the Attorney-General, the Office of Consumer Affairs and Business Regulation, insurance companies, the Boston City Council, and the Massachusetts Public Interest Research Group (MassPIRG) to study and preserve the "assistance feature" within automobile insurance rating systems. The "assistance feature" refers to an internal cross-subsidizing mechanism that was part of the former "fixed-and-established" rating system used before 2007, where certain policyholders' premiums helped offset the costs for others. The commission's primary purpose is to devise a process to ensure this feature continues in future automobile insurance rating systems, including the currently developing competitive rating system overseen by the Division of Insurance. To achieve this, the commission will determine average levels of this assistance feature from 2004 and 2005, and any future rates must maintain at least three-quarters of those averages overall, with individual policies not falling below two-thirds of their equivalent 2004/2005 level. The commission is also tasked with preventing underwriting practices that could undermine this feature, and it must publish its findings and develop legislation to implement its recommendations within three months of the bill's passage or by June 1, 2011, whichever is later. The commission's activities will be funded by an assessment on automobile insurance companies, initially set at ten cents per policy in effect as of January 1, 2011, though an alternative, equally fair funding method may be adopted. The commission must be formed within thirty days of the bill's enactment.