Mass. Fines Safety Insurance over Home Policy Non-renewals

Courtesy of Insurance Journal

Massachusetts Attorney General Martha Coakley's office reports it reached an agreement with Boston-based Safety Insurance Co. over allegations that the company violated the Massachusetts Consumer Protection Law by cancelling or non-renewing 31 consumer home insurance policies for insufficient reasons.

Safety has agreed to pay $41,000 to the Attorney General's Local Consumer Aid Fund and change its practices, according to the terms of a consent judgment filed in Suffolk Superior Court.

The judgment still requires approval by the Court before it becomes effective.

"Consumers are entitled under the law to a clear explanation if their homeowner's insurance policy is going to be cancelled or non-renewed," said Attorney General Coakley. "Today's settlement represents another step toward ensuring that Massachusetts consumers are treated appropriately under the law by their insurance companies."

According to the complaint, Safety allegedly failed, in some instances, to provide specific reasons for the cancellation or non-renewal of insurance policies. In notices sent to homeowners, Safety offered vague reasons such as "underwriting guidelines" for its decisions. Under the terms of the settlement, Safety is required to send notices containing specific reasons for their cancellation and non-renewal decisions to consumers.