Massachusetts Auto Insurance Laws, Managed Competition and Requirements

Massachusetts auto insurance costs more than almost any other state because of its high urban population as well as its higher cost of living. Of the six million people that live in Massachusetts, the majority live in the metropolitan area of Boston. Since there is such a large amount of people and drivers, there are a lot of claims every year for both bodily injury and property damage. Insurance rates rise and fall with the number of claims.

Competition is every consumer's friend and insurance is no different. Until recently, Massachusetts auto insurance law was still controlled with a fixed rate by state regulation. During that time, 16 private insurance companies withdrew from offering private insurance. Then in 2008, Massachusetts became the last state to institute managed competition. This allows insurance companies to compete against each other, thereby creating competitive rates. Since this change, over nine insurance companies have come on board.

With managed competition in place for Massachusetts auto insurance, consumers are now saving money on insurance premiums as well as saving money through a variety of discounts. Statistically, many drivers are also increasing their coverage and there are more insured vehicles on the road now than in previous years.

Mandatory coverage requirements are still in place, including $20,000 per person or $40,000 per accident for bodily injury, $8,000 for personal injury protection, and $5,000 for property damage. While these are only the minimums, you can increase this coverage as well as add optional coverage. The law also has provisions in place for insurance discounts such as for safety restraints, anti-theft devices, and for senior drivers over the age of 65. Optional discounts may also apply, such as multi-policy advantages or getting certified in an advanced driver training course.

Consumers have many rights in Massachusetts when it comes to auto insurance, including the right to get insurance without being denied for discrimination. In addition to gender and race, you cannot be discriminated against based on your job or where you primarily park your car. You also cannot be denied coverage due to your credit history. Accidents and traffic tickets that are greater than six-years-old cannot be a factor in determining eligibility. If you are denied insurance coverage you are entitled to an explanation; and if you are legitimately denied you may be able to get coverage through the Massachusetts Automobile Insurance Plan (MAIP).

After you receive your quote, you should shop around for additional quotes and be sure to compare them accurately so that you have a real picture of your costs and your coverage. Take discounts into consideration, as well as policy term length. You are entitled to a policy of one year if you would prefer that to a six month term, and it may cost less. You can always cancel and switch companies if you decide to do so later on. So even though Massachusetts auto insurance premiums are high, there are ways to reduce your costs while still getting sufficient insurance.

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As of 2008, Massachusetts auto insurance regulators implemented a policy for managed competition.

An $8000 personal injury protection (PIP) clause must be included in your policy for Massachusetts auto insurance.

Check additional valuable information of your State Insurance department organization.
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