Commonwealth Automobile Reinsurers

MAIP FAQs - Company - As of April 15, 2009

Do carriers have access to a file showing all agencies that may produce a MAIP policy?

Will CAR assign a single MAIP Agency Code for ARPs with multiple office locations or will each office have its own code?

How often do ARCs receive assignment notification from MAIP?

How do companies receive all the data that is needed to rate a policy?

Are companies required to rate an assigned policy with MAIP rates and company voluntary rates and use the lower of the two?

How does a company statistically report a MAIP policy with company voluntary market rates?

Are companies required to renew assigned policies each year or may they non-renew for any reason?

Are ARCs required to take motorcycles from MAIP?

Rule 30. B. H. requires ARCs to maintain and forward to the MAIP a copy of all written complaints filed with the ARC on all ARP's. Will MAIP provide any forms or templates for these complaints?

Do agreements need to be signed by the ARPs and ARCs?

Is there any threshold for premium differences between MAIP rates and company voluntary rates?

What is the expected avenue of resolution for incomplete applications?

In addition to the electronic application sent via MAIP, should ARCs expect a paper application from the ARPs?

Regarding the agent's use of one MAIP stamp, how is the name of the ARC indicated on the stamp?

Is it possible for an insured, who has been non-renewed for any reason to be assigned to the same carrier that non-renewed them?

Since Servicing Carriers will no longer be ceding policies to CAR, and each company will be taking a certain number of the assigned risk policies, how will this affect the agency ERP situation?

If the MAIP rate is lower than a carrier's voluntary rate level, then the carrier must charge the MAIP rate. Do carriers need to report how much higher their voluntary rate level is vs. the MAIP?

When a MAIP policy is issued using a voluntary rate level, how do ARCs specifically identify that this is really a MAIP policy?

MRB does not currently collect no-fault claims and continuous coverage information. In order to determine clean-in-three status, can these criteria be eliminated?

What is the Definition of vehicular felony?

Is a newly licensed motorcycle operator, with an existing automobile license, MAIP eligible?

What is meant by the household member procedure where the application will be returned to MAIP if the assignment has been made contrary to the provisions of 29.F.2.?

Does producer fraud training developed under 31.B.14 satisfy the requirements of 32.A.12?

Is there a conflict between the competition regulations and Rule 37 regarding commissions?

Is the deposit amount required for assigned business determined based on the MAIP premium?

Clean-In-Three Questions

Do the "clean-in-three" provisions apply only to current in-force policies as they renew effective on/after 4/1/2009?

Is an in-force policy reassessed for "clean-in-three" each time it renews effective 4/1/09 through 3/31/12?

What are the conditions under which an ARC may a non-renew clean-in-three policy with an expiration date prior to 4/1/2012?

Do carriers have access to a file showing all agencies that may produce a MAIP policy?
Yes, a list of all existing Representative Producers and Exclusive Representative Producers is available to authorized users on CAR's website.

Will CAR assign a single MAIP Agency Code for ARPs with multiple office locations or will each office have its own code?
CAR will assign a single MAIP Agency Code regardless of the number of office locations or an agency's organizational structure. Please note that the MAIP Agency Code is distinct from company assigned producer code(s).

How often do ARCs receive assignment notification from MAIP?
Assignments are transmitted in batch mode on a daily basis.

How do companies receive all the data that is needed to rate a policy?
Any necessary information not collected from the primary and supplemental applications must be obtained from the producer of record.

Are companies required to rate an assigned policy with MAIP rates and company voluntary rates and use the lower of the two?
Yes, the lower of the residual market or company voluntary market rate must be utilized.

How does a company statistically report a MAIP policy with company voluntary market rates?
Companies will report the premium charged the insured in accordance with the Commissioner's Statistical Plan.

Are companies required to renew assigned policies each year or may they non-renew for any reason?
Rule 29 provides that, "An eligible risk shall be assigned to a designated ARC for a period of three consecutive years." Unless an assigned risk is subsequently written in the voluntary market, the assignment period will continue for the three-year period.

Are ARCs required to take motorcycles from MAIP?
Yes, motorcycles are eligible for placement in the MAIP.

Rule 30.B.H. requires ARCs to maintain and forward to the MAIP a copy of all written complaints filed with the ARC on all ARP's. Will MAIP provide any forms or templates for these complaints?
CAR's Producer Management Program serves as the repository for complaints on ARPs. Complaint forms are available in the MAIP section of CAR's website.

Do agreements need to be signed by the ARPs and ARCs?
The MAIP does not require ARCs to have written contracts with ARPs.

Is there any threshold for premium differences between MAIP rates and company voluntary rates?
The lower of the MAIP rate and the company voluntary rate must be utilized, regardless of the difference in premium.

What is the expected avenue of resolution for incomplete applications?
Incomplete applications will not be accepted for assignment by MAIP.

In addition to the electronic application sent via MAIP, should ARCs expect a paper application from the ARPs?
Rule 31.B.5.a. requires that ARPs provide the original signed application to the ARC within two business days following the assignment.

Regarding the agent's use of one MAIP stamp, how is the name of the ARC indicated on the stamp?
The ARP will be responsible for legibly writing the company name and three digit reporting number on the RMV form.

Is it possible for an insured, who has been non-renewed for any reason to be assigned to the same carrier that non-renewed them?
Yes, assignments will be made based on company quota share and the possibility exists that a non-renewing carrier could receive the risk back through the assignment process.

Since Servicing Carriers will no longer be ceding policies to CAR, and each company will be taking a certain number of the assigned risk policies, how will this affect the agency ERP situation?
For policies effective 4/1/09, except for "clean-in-three" risks, ERPs will no longer be able to place new business or renew policies with their assigned Servicing Carrier. Servicing Carriers will be required to service in force ERP produced policies effective through 3/31/10.

If the MAIP rate is lower than a carrier's voluntary rate level, then the carrier must charge the MAIP rate. Do carriers need to report how much higher their voluntary rate level is vs. the MAIP?
No, ARCs are only responsible for statistically reporting the rates used.

When a MAIP policy is issued using a voluntary rate level, how do ARCs specifically identify that this is really a MAIP policy?
The CAR ID Code will identify MAIP business through the statistical reporting process.

MRB does not currently collect no-fault claims and continuous coverage information. In order to determine clean-in-three status, can these criteria be eliminated?
The MRB currently is evaluating the cost and time required to collect this data going forward. Absent evidence of no-fault claims or a lack of continuous coverage, an insurer must treat that risk as "clean-in-three" for purposes of Rule 21. Answered by DOI

What is the Definition of vehicular felony?
Vehicular felonies include any crimes listed as “Major Traffic Violations” in Appendix A of 211 CMR 134.00, or their equivalent in another jurisdiction that classifies as a felony by law. Answered by DOI

Is a newly licensed motorcycle operator, with an existing automobile license, MAIP eligible?
a) The addition of any newly licensed operator to a policy that already is in effect does not make that policy MAIP eligible. Answered by DOI

b) If a policy in effect covers automobiles and a listed operator receives a new license for motorcycles, the addition of that new license will not qualify the policy for the MAIP. In sum, a policy does not become MAIP eligible solely because of such changes. Answered by DOI

What is meant by the household member procedure where the application will be returned to MAIP if the assignment has been made contrary to the provisions of 29.F.2.?
An assignment to any company under the provisions of the household procedure will be factored into such company's quota share. Any assignment to any company under the provisions of the household procedure that is contrary to the above provisions of Rule 29.F.2. shall be returned to the MAIP promptly for reassignment in accordance with the household procedure rule. Answered by DOI

Does producer fraud training developed under 31.B.14 satisfy the requirements of 32.A.12?
If an ARC believes that the MAIA course, as approved by the Division of Insurance for 3 CEU credits to satisfy Rule 31.B.14., provides appropriate training on Claim reporting and fraud recognition for the producers and CSRs of that ARC or :ADC, then the MAIA course will satisfy the requirements of Rule 32.A.12.A..

Is there a conflict between the competition regulations and Rule 37 regarding commissions?
No. Nothing in Rule 37 is intended to alter the statutory provisions of G.L.c. 175, § 162E. Answered by DOI

Is the deposit amount required for assigned business determined based on the MAIP premium?
Yes, Rule 28.C. provides that for MAIP business with policy effective dates of April 1, 2008 through March 31, 2009 a deposit of not more than twenty five percent (25%) of the premium quoted based on the MAIP rates is required.

Do the "clean-in-three" provisions apply only to current in-force policies as they renew effective on/after 4/1/2009?
Yes, "clean-in-three" provisions apply to all renewal policies effective through 3/31/12. New business as defined in Rule 22 is not "clean-in-three."

Is an in-force policy reassessed for "clean-in-three" each time it renews effective 4/1/09 through 3/31/12?
Yes. In-force policies must be reassessed for "clean-in-three" at each renewal.

What are the conditions under which an ARC may non-renew a clean-in-three policy with an expiration date prior to 4/1/2012?
There are only two circumstances in which a Member may non-renew a clean-in-three risk. 1.) the risk declines to renew the policy written by that Member; or 2.) another Member writes the clean-in-three risk on a voluntary basis.