There is some truth to the old saying about how if you want a job done right, you should do it yourself – and so far this year, at least ten auto insurers in the state of Massachusetts have learned this the hard way.
On Thursday, May 6th, that state’s attorney general announced that four insurance companies – Arbella Mutual, Norfolk & Dedham, United Services Automobile Association and Electric Insurance – will pay fines and compensate 10,000 auto insurance customers who were penalized as a result of inaccurate accident reports indicating that they had been at fault.
Earlier this year, six other auto insurers – Commerce, Metropolitan, Liberty Mutual, Peerless, Plymouth Rock and Pilgrim – were also found to have inaccurate records and were similarly penalized. In addition, GEICO, Occidental, Progressive and Ameriprise may have overcharged their own customers based on faulty data.
What Happened?
This was apparently the result of Massachusetts insurance companies’ practice of outsourcing. In the wake of industry deregulation two years ago, major insurers began using private databases to rate customers. Careless recording practices resulted in drivers being wrongfully assigned fault in accident reports – resulting in higher premiums.
The problem came to light last October when the Massachusetts AG’s office received a consumer complaint about overcharges based on an inaccurate accident report.
The insurers involved have not admitted to any deliberate wrongdoing, but have agreed to review their records and make corrections in addition to paying monetary fines and compensation to auto insurance customers.
Protecting Yourself
Just like credit reports, motor vehicle records can also contain mistakes and can happen for any number of reasons – software glitches, misspellings, poor handwriting on the original report, conflicting accounts, etc. It is always a good idea to review your own driving record from time to time.
If an insurance company informs you that you’ll be charged more because of an accident that was your fault, your first step is to ask about their source of the information; i.e., which private company provided the data. You should then contact that company and ask where they obtained the record of the accident and request a copy. Assuming the accident was reported to law enforcement officials, you should be able to check the database company’s records against the original police report. The latter will serve as proof when you file an appeal with your insurer.
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