Boston-based Plymouth Rock Assurance Company, Massachusetts’ 9th largest auto insurer, has come up with an innovative plan for giving policyholders their renewal premium rates – it’s providing them with the actual rates applicable to the year 2002, rather than provisional figures which have to be modified.
“Avoiding provisional policies reduces consumer confusion and, by eliminating redundant processing and mailings, helps drive down expenses for our independent agents and us,” Paul Luongo, vice president, information technology, with Plymouth Rock stated in the announcement.
This year, the auto insurance industry and worked out an early rate agreement with the Massachusetts insurance regulators. Insurance Commissioner Linda Ruthhardt issued the rate decision in early October. Anticipating the early decision, Plymouth Rock began upgrading and testing its systems in September and completed the work in time to implement the change by mid November.
In prior years, since policies must be sent at least a month in advance of renewal dates, insurers needed to issue policies for January, and sometimes February, with provisional rates and made adjustments when the actual rates became available. This posed an administrative headache and added expense because approximately one-quarter of all auto policies renew in January–more than any other month. Meeting the deadline to issue up-to-date policies required changing internal systems that had been in place for years. “We pushed hard to get through a small window of opportunity,” Luongo stated. “It’s part of our effort to help make auto insurance in Massachusetts easier and more efficient for our agents and their customers. We’ve had a tremendous response.”