More Insurers to Return Money to Motorcycle Policyholders in Massachusetts

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March 3, 2010 Wednesday 04:02 PM EST

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More Insurers to Return Money to Motorcycle Policyholders in Massachusetts

Chad Hemenway

BOSTON

For the second time this year Massachusetts Attorney General Martha Coakley said her office reached a settlement with a group of insurance companies over allegations they were overcharging for motorcycle insurance. The settlement is expected to return $9 million to policyholders, Coakley said.

Metropolitan Property & Casualty Insurance Co., Plymouth Rock Assurance, Pilgrim Insurance Co., and USAA are alleged to have inflated motorcycle values when calculating premiums by using old book values on aged motorcycles, Coakley said in a statement. Metropolitan is set to return $3.5 million to policyholders. USAA will return $2.3 million and Plymouth and Pilgrim are expected to return a combined $3.6 million, said Coakley. Plymouth and Pilgrim are members of Plymouth Rock Cos.

Emily LaGrassa, a spokeswoman at Coakley's office, said the settlement was the result of an investigation from a complaint Coakley's office received in the fall of 2008, which also led to a settlement with Safety Insurance Co., Liberty Mutual and Quincy Mutual (BestWire, Jan. 15, 2009). In total, all insurers are to pay about $20 million to policyholders and $1 million to the state, Coakley said.

USAA Group currently has a Best's Financial Strength Rating of A++ (Superior). Metropolitan Property & Casualty Insurance Co. currently has a rating of A (Excellent). Plymouth Rock Assurance Group and Pilgrim Insurance Co. each currently have a rating of A- (Excellent).

The top five writers of private passenger auto insurance in Massachusetts last year, according to BestLink, were: Commerce Group, with a 31% market share; Safety Group, with 11.1%; Arbella Insurance Group, with 9.3%; Liberty Mutual Insurance Co., with 8.5%; and MetLife Auto & Home Group, with 6.5%. BestLink provides online access to A.M. Best's Global Insurance & Banking Database.

(By Chad Hemenway, associate editor, BestWeek: [email protected])

March 4, 2010

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