Auto Insurance Company Under Investigation

It would seem that the auto insurance company Premier Insurance Company is under investigation by the state of Massachusetts. The state’s Attorney General Martha Coakley has recommended that the state’s Division of Insurance check the way that they rate their customers.

Coakley requested an administrative rate proceeding to review the auto insurance company’s new auto insurance rates. The auto insurance company is a subsidiary of Travelers Insurance, and they have recently filed new rates with the state. However, Massachusetts regulations state that you cannot discriminate against consumers based on their homeownership. The auto insurance company is accused of doing precisely that.

The auto insurance company’s new rating system takes into consideration many different factors when deciding how much their consumers will pay for their policies. However, under their new rates anyone who purchases homeowner’s insurance with any insurance carrier can get a 5% rate reduction. Those that do not have homeowner’s insurance cannot get the discount. This eliminates those that do not own homes from being able to get a cheaper rate on their auto insurance policy.

The state regulates their auto insurance very carefully – ensuring that those that do not own homes are not discriminated against. They also make sure that their income, education, occupation and marital status are not used in determining how much they will pay for their car insurance. Coakley says that all auto insurance companies must follow the same rules as they pertain to discrimination, and therefore they are all on the same “level playing field.” She said that those that do not comply will have action taken against them.



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