April 1, 2008, was a revolutionary day for the Massachusetts car insurance industry. Previously, there was no competitive car insurance in the Bay State. What does this mean? Pricing was heavily regulated by the Massachusetts Division of Insurance; the cost of insurance was the same no matter who you bought from. The cost would vary based on where you lived and the amount of coverage you purchased. More coverage would equal more cost, but depending where you lived, you could get a break. Each town in Massachusetts has a rating; Cape Cod towns have relatively low ratings compared to drivers in more heavily trafficked areas, like Boston, where there are more accidents and car thefts. If you live on Cape Cod, your insurance will be less than if you live in Boston, with coverages staying the same.
The first five years (2008 – 2013) was a slow “deregulation”. No major price differences; rates were submitted to the Division of Insurance for approval and they couldn’t vary much from company to company. In 2013, insurance companies made more changes to their pricing structure, lowering the overall cost and offering more credits and discounts. More direct writer insurance companies like GEICO, Progressive and AllState came to Massachusetts because of deregulation. The state has more than 30 car insurance companies doing business here, with a mix of local insurance agents, banks and direct writers selling insurance.
Bringing competitive car insurance to Massachusetts was good for local insurance agents as they were able to work with more insurance companies, offering clients a greater variety of options. Many companies began offering a credit if you had your car insurance with the same company or agency as your homeowner insurance. Don’t own a home? No problem. Package your car insurance with a renter policy to protect your belongings and save on your car insurance.
Agencies are better able to differentiate themselves by becoming your trusted insurance advisor; similar to a CPA, lawyer or banker. Your trusted insurance advisor will ensure you have the proper insurance suited to your needs: home, auto, business, life, health, disability, etc.
- Car insurance rates were the same with every insurance company before 4/1/2008
- Home & property rates increased on Cape Cod and other coastal communities; car insurance rates are less today than 30 years ago
- Massachusetts’ claim to fame was the most expensive car insurance in the country. Now, it’s less than many other states