State moves to introduce competition to auto insurance market

BOSTON - Car owners could gradually see more competition in the auto insurance market, under a plan unveiled Monday by the state insurance commissioner.
The transition to "managed competition" will continue to give the state strong regulatory control to protect consumers from excessive rates, but will also introduce more competition and create more choice and lower premiums, Insurance Commissioner Nonnie S. Burnes said.
Massachusetts in the only state where state regulators, not the market, set car insurance rates.
Consumers should be able to take advantage of the new competitive rates for policies renewing on or after April 1, 2008, Burnes said.
"Taking gradual steps to introduce competition to the auto insurance market will have a positive impact on consumers across Massachusetts," Burnes said.
In March, a panel appointed by Gov. Deval Patrick to study ways of reforming Massachusetts’ auto insurance system recommended curbing state regulation and moving toward competitive, market-based rates.
The state’s insurance rates have been going down in recent years because of decreasing claims, and a crack-down on auto insurance fraud.