Insurance Commissioner reverses course on abolition of state appeals board

Jon Chesto

With only two weeks remaining before the change was to take effect, State Insurance Commissioner Nonnie Burnes has reversed her previous decision to abolish the board that handles appeals of at-fault car insurance surcharges.

Burnes attributed her decision to keep the state Division of Insurance’s appeals board in place on Wednesday to the public’s concerns regarding her proposal. Under Burnes’ previous plan, the appeals board was to stop accepting cases after April 1, and consumers would then need to appeal surcharges imposed because of car accidents to their insurers instead.

Critics of the change said insurers would not be able to serve as impartial judges because their own revenue would be at stake, and that about half of the decisions by appeals board hearing officers have been in favor of consumers.

“We had every confidence that this new plan would protect consumers and offer them a fair resolution,” Burnes said in a prepared statement. “However, we have heard the concerns voiced by the general public.”

Burnes previously said the change was a necessary part of her multi-pronged approach to introduce a more competitive system to the state’s auto insurance market. This state’s market had been the most strictly regulated market of any state’s before last spring when Burnes gave auto insurers wide latitude in their rate-setting process for the first time in decades.

Frank Mancini, the CEO of the Massachusetts Association of Insurance Agents, said motorists are going to benefit from Burnes’ change of heart.

“It think the commissioner finally came to the realization that consumers would be better served with the board of appeals rather than have insurance companies make the final determination,” Mancini said.

Burnes’ policy change also comes in the face of growing support in the Legislature for a bill that would keep the appeals board system intact. Mancini said his group will still push for passage of the legislation as a long-term measure to protect the state’s appeals system.

“Regulations can be changed at any time,” Mancini said. “A future commissioner could do it. This legislation needs to move forward so the board of appeals is still authorized under the competitive (market).”

Jon Chesto may be reached atjchesto@ledger.com.