Coakley claims insurance company is discriminating

Drew Smith Nov. 25, 2008, 9:52am

Martha Coakley (D)

BOSTON (Legal Newsline) -- Massachusetts Attorney General Martha Coakley is asking the Division of Insurance to review the new auto insurance rates of Worcester-based Premier Insurance, a subsidiary of Travelers Insurance.

The company filed new rates that Coakley claims discriminate against consumers based on home ownership. The new rating system allows those who purchase homeowner's insurance to receive a 5
percent rate reduction, while those who don't purchase the coverage cannot get the discount.

Massachusetts law prohibits auto insurers from basing rates on income, homeownership, and other surrogates for income, such as education, occupation or marital status.

"Consumers should not be unfairly discriminated against in their purchase of auto insurance," the Democratic attorney general said. "When regulations require that insurers not discriminate based on homeownership, it's important that all of the insurance companies follow these rules and operate on a level playing field.

"Increased competition has the potential to bring down rates and serve consumers' interests; however, it's important for our office to actively protect consumers and to pursue matters when rates are unfair or discriminatory. We will continue to review rate filings and take needed action to protect consumers," Coakley said.

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