Mass. Auto Web Site Misleads Consumers, Say Agents and AG

A state Web site intended to educate consumers about Massachusetts’ newly deregulated auto insurance market instead gives them inaccurate rate comparisons, according to Attorney General Martha Coakley.

Coakley argued the site misleads drivers into thinking that they’re using an effective tool for comparison shopping among the state’s 19 insurers. But the site is only 20 percent to 40 percent accurate in advising which insurer offers the best rates, Coakley said.

She called on Insurance Commissioner Nonnie Burnes to revamp the site, although she stopped short of asking her to take it down. “The Web site as it is currently maintained is not only not helpful, it’s misleading,” said Coakley.

Coakley’s criticism came on the day the state’s new managed competition system went into effect and weeks after insurance agents urged Burnes to revamp the site. The agents told Burnes that the site, which only asks six questions, is extremely limited in its options and does not produce accurate premiums.

“While we understand the intention of the site is to assist consumers in the new managed competition environment, in our judgment, it is resulting in a more confusing experience,” Frank Mancini, president and CEO of the Massachusetts Association of Insurance Agents, advised Burnes in a letter in early March.

Burnes said she takes concerns about the site “very seriously.” She said she hoped to work with Coakley to give consumers the information they need to “make informed auto insurance choices” but defended the Web site as “an important tool and useful starting point” for consumers.

As of April 1, the Web site — http://www.autoratecompare.doi.state.ma.us/ — had received more than 600,000 hits since it became operational Feb. 19.

The Web site allows consumers to enter data about their driving records and vehicles to get sample premium quotes. It advises that actual quotes “may differ significantly” from the samples.

Coakley said those warnings don’t make up for the fact that the sample quotes frequently don’t reflect the rate an insurer would actually offer. Rates can differ from the samples because the site doesn’t factor in discounts and other criteria that insurers consider.

Kimberly Haberlin, a spokeswoman for Burnes, said the site is similar to comparison-shopping auto insurance sites in other states. She also said the site makes it “abundantly clear” that the tool does not calculate discounts.

“The site is not a premium calculator, and clearly states that it does not provide rates,” Haberlin said. “Each driver’s situation is unique — that’s why we have been and will continue to urge consumers to talk to a company or an agent to better understand their choices.”

Topics Auto Agencies Massachusetts Training Development