Based on a review of the last 10 years of insurance rate
filings and the proposed rates by the Auto Insurance Bureau (AIB), it is
reasonable to believe that the average insurance rate would have dropped next
year (2008) by an average of about 11.5%.
Over the last 10 years, the final overall average insurance
rate change has been 9 points lower than what is filed by the AIB. Therefore,
if you subtract 9 points from the 2008 AIB filing of - 2.5%, we see that drivers would have had an
estimated 11.5% rate reduction under the now scrapped rate-setting process.
|
Year
|
Industry proposed Avg. rate change (AIB)
|
Final Approved Avg. Rate Change
|
Point Difference
|
|
2008
|
-2.5%
|
-11.5% (estimate based on historical data)
|
9 (estimate based
on historical data)
|
|
2007
|
-3.7
|
-11.7
|
8
|
|
2006
|
-0.1
|
-8.7
|
8.6
|
|
2005
|
5.8
|
-1.7
|
7.5
|
|
2004
|
12.4
|
+2.5
|
9.9
|
|
2003
|
7
|
+2.7
|
4.3
|
|
2002
|
7.8
|
0.0
|
7.8
|
|
2001
|
2.5
|
-8.3
|
10.8
|
|
2000
|
7.8
|
+0.7
|
7.1
|
|
1999
|
15.5
|
+0.7
|
14.8
|
|
1998
|
6.8
|
-4.0
|
10.8
|
Total – 89.6 point difference or an average of 9
Further, in MASSPIRG testimony before the Division of
Insurance on September 20,
2007, MASSPIRG urged the Commissioner to determine what rates would
have been under the fixed and established system to allow us to determine if
the new “managed competition” had in fact, delivered lower rates for consumers.
