The Fed's latest news has prompted another round of what-ifs.
BOSTON, Dec. 4 -- The Massachusetts Attorney General issued the following news release:
Massachusetts motorcycle owners will receive more than $2.8 million in insurance refunds as a result of settlements with two insurance companies that allegedly overcharged thousands of policyholders, Attorney General Martha Coakley announced today.
The AG's Office has reached similar settlements with 15 other insurance companies since 2010 for a total of 17, returning more than $42.8 million to Massachusetts consumers.
"This investigation began with a single consumer complaint, and has now resulted in the return of $42.8 million to Massachusetts motorcycle owners," AG Coakley said. "These cases underscore the need for transparent auto insurance rates. Consumers and regulators have the right to know how insurance companies are calculating premiums so that issues like these can be identified and addressed."
According to the two settlements, both filed in Suffolk Superior Court, Encompass Insurance Company of Massachusetts, a subsidiary of Allstate, and Amica Mutual Insurance Company are alleged to have illegally overcharged Massachusetts customers by using inflated and un-depreciated motorcycle values to calculate insurance premiums.
Under the terms of the assurances of discontinuance, Encompass will pay policyholders approximately $2 million and Amica will pay more than $800,000. The two carriers will also make civil payments to the Commonwealth totaling $93,600.
Together, Encompass and Amica are required to send out more than 10,000 refund checks before February, with an average check around $280.
All 17 of the related motorcycle settlements stem from a complaint the AG's Office received from a consumer who owned a 1999 Harley-Davidson Road King Classic. In each year between 2003 and 2008, the consumer's insurance company calculated the consumer's premiums as if his 1999 Road King Classic were brand new and worth $20,000. By 2003, the consumer's four-year-old motorcycle was worth significantly less than its original price, and by 2008, the nine-year old motorcycle was worth less than $12,000. Still, in each year between 2003 and 2008, the consumer's insurance company used the inflated $20,000 value to rate his policy, resulting in more than $1,500 in overcharges.
In order to be eligible for a refund under AG Coakley's settlements, a consumer must have purchased comprehensive and/or collision insurance coverage for a motorcycle on or after Jan. 1, 2002 and that motorcycle must have been overvalued by the insurance company for the purpose of calculating premiums. Consumers who have questions about the settlements or their refunds may visit the Attorney General's Motorcycle Insurance Settlements FAQ or call the Attorney General's Insurance & Financial Services Division at 1-888-830-6277.
These matters were handled by the Insurance & Financial Services Division's Mathematician Burt Feinberg, Investigations Supervisor Arwen Thoman, Mediator Rebecca Dutra and Assistant Attorney General Glenn Kaplan, Chief of Attorney General Coakley's Insurance & Financial Services Division.
TNS JF78JF-121205-4129089 EditorFurigay