BOSTON (Legal Newsline) - Massachusetts Attorney General Martha Coakley announced on Tuesday that Massachusetts motorcyclists will be getting an additional $12.1 million in refunds from five auto insurance companies that allegedly overcharged riders on insurance premiums.
Arbella Mutual Insurance Company, Hanover Insurance Group, OneBeacon Insurance, also known as Massachusetts Homeland, National Grange Mutual and Norfolk & Dedham Group allegedly used inflated and un-depreciated motorcycle values to calculate Massachusetts motorcycle riders' premiums on their policies, resulting in overcharges.
With the seven settlements Coakley reached earlier this year, 12 insurance companies are paying back more than $33.8 million to Massachusetts residents and more than $1.5 million to the State for overcharges.
"We began our industry-wide investigation into motorcycle insurance based on a single consumer complaint. To date, that investigation has forced 12 insurance companies to return more than $33 million to Massachusetts motorcycle owners," Coakley said.
"As this investigation demonstrates, and as the insurance companies in this state know, when consumers bring complaints to our office, we listen and we take action."
Coakley's Insurance & Financial Services Division received complaints about motorcycle rating practices in the fall of 2008. Coakley believes that many of the insurance companies operating in the state between 2002-2009 engaged in similar activities.
Those affected had purchased comprehensive and/or collision coverage for their motorcycles in the years 2003 through 2008, and allegedly had their vehicle overvalued by the companies when their premiums were calculated.
According to the agreements, Arbella must pay $6.3 million, Hanover is required to pay $2.5 million, OneBeacon will pay $2.1 million, NGM is required to pay $645,679, and N&D must pay $554,480 to consumers. Each insurance company must also make payments to the state totaling over half a million dollars.
Coakley's suit alleged that over 100,000 policies are eligible for refunds under the settlements reached to date. Of those policies, more than 18,500 policies are eligible for refunds of over $500.