In This Issue - Summer/Fall 2010Residual Market News
Commonwealth Automobile Reinsurers
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Residual Market News
Approval of Chapter 237 of the Acts of 2010
In early August, Governor Patrick signed into law Chapter 237 of the Acts of 2010 (formerly House bill H 4476 - An Act Relative to Exemptions in the Massachusetts Automobile Insurance Plan). The new legislation, which makes several changes to Section 113H of Chapter 175 of the Massachusetts General Laws, becomes effective on November 4, 2010 and will require several modifications to CAR's Plan and Rules of Operation.
- The MAIP Steering Committee will meet on September 29, 2010 at 10:00 to consider the following amendment to
Rule 30 - Assigned Risk Company Requirements of CAR's Rules of Operation:
Producer Ownership of Expirations
The approved legislation requires that Assigned Risk Companies continue to recognize the producer of record for former MAIP policies written voluntarily unless 1) the producer is decertified or suspended by the plan or commissioner, 2) at the insured's request, the insured terminates the producer as its producer of record or 3) the producer of record is precluded from dealing with other insurance companies pursuant to an exclusive agency contract. It will therefore be necessary to eliminate the language in Rule 30.C.1.d. that states that as of April 1, 2011, Assigned Risk Companies are permitted to take policies out of the MAIP, write them voluntarily and no longer be obligated to the producer of record unless there was a contract between the licensed producer and the Assigned Risk Company.
- Additionally, the Ad Hoc Legal Committee will meet on September 29, 2010 at 1:00 to consider the following amendment to
Article I - Structure and Governance of CAR's Plan of Operation:
CAR Governing Committee Representation
Article I must be amended to conform to the changes that were made to Section 113H of Chapter 175 of the Massachusetts General Laws, modifying both company and producer representation on CAR's Governing Committee. The modification that specifically impacts producers states that two of the producer members of CAR's Governing Committee must write private passenger motor vehicle insurance exclusively through the MAIP which means that these producers must not have a voluntary appointment.
New Assigned Risk Companies
Chartis Property Casualty Company, a member of the American International Group (AIG), was approved as an Assigned Risk Company effective August 2010. Vermont Mutual Insurance Company has also received approval to become an Assigned Risk Company effective October 2010. Both companies have contracted with Pilgrim Insurance Company to act on their behalf as an Assigned Risk Company.
Looking ahead, the following companies will be required to become Assigned Risk Companies by the dates noted:
- IDS Property Casualty Insurance Company (April 2011)
- Occidental Fire and Casualty Company of NC (April 2011)
- Preferred Mutual Insurance Company (April 2011)
- GEICO General Insurance Company (May 2011)
- Harleysville Worcester Insurance Company (July 2011)
- Allstate Insurance Company (November 2011)
It is required that a current copy of each producer's license be on file with CAR. Assigned Risk Producers must forward a copy of their license to CAR upon renewal since failure to provide CAR with a current and valid agency license will result in the suspension of access to the MAIP Policy Application and could result in the possible decertification of the Assigned Risk Producer.
CAR's automated email reminder application prompts producers to forward a copy of their license upon renewal with an initial reminder email sent at the beginning of the month in which CAR's records indicate the license is due to renew and a subsequent reminder email sent at the beginning of the next month to those agencies from whom an updated copy of the agency license has not yet been received.
Most correspondence between CAR and producers is email based, therefore is it important that producers assure that current and accurate email address information is on file at CAR.
MAIP Landing Page Enhancement
Look out for an upcoming change to the MAIP Policy Application landing page. The landing page (the page where you initially sign in to access the MAIP Policy Application) is being redesigned to provide producers with breaking news items and other important MAIP information impacting the producer community. This enhancement will provide another way for CAR to pass along important information to producers in an efficient and timely manner.
User ID Maintenance
Agency Security Administrators are requested to delete user IDs for personnel who are either no longer employed by the agency or no longer require MAIP access. To perform a review of user IDs, Security Administrators should sign into the MAIP section of CAR's website and select Security Administration. The Inactive Users listing will display user IDs that have not been active in the last 60 days. CAR recommends that user IDs for which there has been no activity in the last year be deleted from the system.
1. How can changes/endorsement be made to a policy assigned through the MAIP?
Once a MAIP policy is assigned to an Assigned Risk Company, any requests for changes/endorsements to that policy should be made directly to the Assigned Risk Company.
2. I have made an assignment through the MAIP but the applicant has decided not to accept the policy. Whom do I notify?
If an applicant decides not to take a policy after assignment to an Assigned Risk Company, the producer must notify the Assigned Risk Company that the policy has not been taken by the applicant.
3. What are valid reasons for a company to cancel or non-renew a policy?
An ARC may cancel or non-renew a policy under the following circumstances:
- If the risk does not pay the premium on the policy.
- If the company finds that the risk was responsible for fraud or material misrepresentation when applying for the policy or any extension or renewal of it.
- If the automobile registration has been suspended or revoked during the policy period.
- If the driver's license of the person(s) listed on the coverage selections page is suspended or revoked during the policy period.
Producer Directory - Email Addresses for Additional Office LocationsSeveral companies have suggested that it would be helpful for the Producer Directory to contain email addresses for an agency's additional office locations. The Producer Directory (which is located on the MAIP Company page of CARís website) contains a list of all certified Assigned Risk Producers, identifies the main agency office location as well as additional office locations and includes address, phone number and other contact information for each location. If you would like the email addresses or other contact information applicable to your agency's additional office locations represented on the Producer Directory, please complete the Agency Information Update Form which is available on the MAIP Producer Forms section of CAR's website.
Please feel free to provide feedback or suggest future MAIP Messenger topics by contacting Marian Adgate at firstname.lastname@example.org.