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Massachusetts Liberal

Observations on politics, the media and life in Massachusetts and beyond from the left side of the road.

Tuesday, July 17, 2007

Let the battle begin

There's already some teeth-gnashing over a plan for "managed competition" of our auto insurance system, even when the announcement was timed for well past the end of the business day.

Well, here's what many will perceive as a decidedly un-liberal view: it's about time. I'm tired of subsidizing bad drivers.

I say that with the understanding that my rates could be kicked up based on where I live -- probably about 500 feet from the city line in one of those leafy liberal enclaves. If the system being proposed by Insurance Commissioner Nonnie Burnes places a heavy emphasis on where a car is garaged, I'm toast. I don't even have a garage.

What I do have is a good driving record and I am tired of covering the rates of the Massholes who weave in and out of traffic, run lights and make me stop short when they cut me off at 70 (I'm not an angel, but I'm not an idiot either).

I was around for the disastrous competition experiment and, as a younger, less experienced driver, I did the logical thing. I moved farther away from the city.

I'm not here to defend the insurance companies -- heaven knows I have no love for an industry that wants your money and until they have to pay a claim and then drops you like a hot potato. I still remember what Allstate did to my parents after an accident for which they were not at fault.

But there is something seriously wrong with a system where those who are careful and play by the rules wind up paying for those who do not. The current system frankly is a disincentive to good drivers -- what happened to merit credits?

And don't hand me anything about this ruling being a payback to Deval Patrick for insurance industry support in the election. At least until you have some proof other than campaign contributions -- which in this state can maybe buy a politician a cup of Starbuck's.

Competition failed when it was tried in 1977, but dude, it's 2007. The current system is just as broken. I say trust but verify.

Did I just quote Ronald Reagan? This might be a more serious problem than I thought.



Anonymous HereWeGoAgain said...

I'd have no problem if they took away the incentive for bad drivers to keep driving bad, i.e. rates lower then what they would pay if they were not subsidized from good drivers.

But the problem lies in that good drivers are still subsidizing bad drivers due to the way rates are going to be allocated by the insurance co's. The only difference is now instead of good drivers all across the state subsidizing them, it becomes the good drivers in metro areas. As far as I know the biggest percentage of what your rate is the likelihood of getting into an accident computed by the claims rate of your town, city or burrow. That means now we'll be subsidizing them even more, even as their rates skyrocket. So who wins? Who loses?

Undoubtedly the insurance CO's who will make a killing on new rates on bad drivers willing and able to pay. The people in the suburbs and west of the state will no longer subsidies bad drivers at the levels they do now, so good for them. But what about the people who have good records, but live in area where bad drivers cause more accidents? Doesn't this unfairly move the rate in-equality on them? And before you said, "tough luck they live near the city." I ask why is that argument any different the "tough luck, we all live in Massachusetts". This is unfairly going to be hard on good drivers with small incomes around and in the city.

Short term I also see a spike in bad drivers who are driving uninsured because they are unable or unwilling to pay the higher premiums they'll get. I don't feel any pity for them, but what happens when they cause another accident? Stiffer penalties for driving uninsured might be a better idea temporarily.

Now if they revamp how they rate you, basing it almost exclusively on past driving record, and age when you first start driving, and move away from the "your more likely to get into an accident here" crap, then I'm all for this! But they won't, because they're not going to micro manage rates like that.

July 17, 2007 11:18 AM  

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