AG putting up roadblocks

By Boston Herald Editorial Staff


The winner of a growing turf war between Insurance Commissioner Nonnie Burnes and Attorney General Martha Coakley may turn out to be Massachusetts drivers. After all, the skirmish appears to center on which one can deliver the lowest auto insurance rates.

But drivers will only benefit over the long term if Coakley drops what appears to be a push for a return to the old, heavily-regulated way of doing things.

In recent weeks, Coakley has raised the ire of the state’s auto insurers by issuing multiple warnings about next year’s rate filings, then ordering public hearings on the filings of five companies.

Coakley argues that the state’s five largest carriers are “overcharging” customers - overestimating their losses, and taking advantage of loosened regulations to pad their profits.

Under the old system, Coakley keeps insisting, drivers might have been entitled to a deeper cut in rates than those insurance companies are now proposing. (A 7 or 8 percent average rate reduction - much more for some drivers - apparently doesn’t cut it.)

But that’s just the point - that was the old system. Under a competitive auto insurance system, drivers will for the first time have the option of bailing on a company that fails to offer the best deal.

For her part, Burnes (a former judge and architect of “managed competition”) has made it clear that she’s comfortable with at least eight of the companies’ rate filings, certifying them last week. Eleven more are pending. Burnes will, however, hold hearings on the five carriers that Coakley has flagged. One of them, Commerce Insurance, Burnes has raised her own concerns about.

The attorney general is rightfully concerned that drivers under the new system be educated on their options, and learn how to choose a carrier that offers them the best deal. It is appropriate for her to examine the filings and ensure that no company is sidestepping the sensible and fair regulations that Burnes has established.

But given the misguided call by some lawmakers to scrap competition before it even starts - and the heavy hand that Coakley now appears to be wielding - we can’t help but be concerned. Coakley says she isn’t anti-competition. Now is her opportunity to prove it.