December 15, December 15, what is it I usually do around this time of year? Oh, right, no auto rate decision this year!
December 15 came and went this year without the formerly annual announcement of the Massachusetts Division of Insurance's decision on personal auto insurance rates. Over the weekend, I got a slight twinge while buying a Christmas tree, thinking there was some massive document I was supposed to be reading instead. Luckily, there was not, especially since I have also again set Proust's "In Search of Lost Time" aside.
So the question is, in its stead, has the departed system left something better? This is theoretically the first and last time insurers will all file auto insurance rates at the same time, so in the future, the process may be met with less fanfare.
Massachusetts Attorney General Martha Coakley has said she's trying to maintain a transparent rating process, but what exactly was transparent about the old system? The interested parties holed up in the Division for eight months a year, haggling and straining toward Dec. 15, when the Commissioner would make the pronouncement. Certainly, the reasons were clearly set out for all to read, but if anyone not involved in the industry actually made it through the last 30 years of 100+ page rate decisions, hats off to them.
Now, Coakley has discovered a hearing room in which her office's claims will always be accepted as fact - the press. The industry's claims that her office is "uninformed" might be a bit strong, but the Massachusetts Insurance Federation is correct by pointing out that Coakley is essentially trying to undermine the system before it starts. There are better uses for her resources.
It's valid to recall that while rates were being set by the state, the Division rarely agreed with either the industry or the attorney general, but took a middle ground. That 18.2% rate reduction recommended for 2007 rates was a purely political ploy for an AG determined to gain ground in the gubernatorial race.
Although still in her first year as AG, Coakley seems to have adopted a similar stance as a surrogate insurance regulator and it may not be the most helpful decision. If there are inaccuracies and inappropriate costs included, the Division and the marketplace should correct them with the assistance of the AG, rather than the de facto opposition.