Massachusetts Auto Insurance: Occidental Controversy

In the Insurance Journal, it was reported that Attorney General Martha Coakley is wary of a potential entrant into the Massachusetts auto insurance market. Occidental Fire and Casualty Insurance Company recently filed its proposed rates for high-risk drivers, and they are 10% more expensive than average high-risk policies in the state.

Occidental also wants to charge several surcharges and fees that are either illegal in Massachusetts or considered unfair, including:

A 35% surcharge for those unable to verify their driving records, including recent immigrants from non-English speaking countries who can’t get their records in English. That’s on top of the higher premium for inexperienced drivers.
Drivers filing glass claims have to pay Occidental two deductibles: a comprehensive deductible and a separate glass deductible
A fee of $25 tacked onto each initial policy purchase
Fees of $8 per installment

In addition, Occidental does not allow drivers to reinstate their auto insurance policies after being canceled for nonpayment, which is against Massachusetts law. (Buying a new policy after having one canceled results in more costly auto insurance premiums.) Coakley is especially concerned because Occidental is targeting inner-city communities, where residents tend to have fewer auto insurance options.

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