Two seats on the Steering Committee have been vacated for CAR Independents

The Legislature passed, and Governor Baker signed, the state’s Fiscal Year Budget authorizing the use of state goods, services, and programs for the 2023 fiscal year, which runs from July 1, 2022, to June 30, 2023.

Commonwealth Automobile Reinsurers

The $52.7 billion budget is a big deal. The main rule is often crossed with unrelated rules, which are often called “riders” combined. In Massachusetts, the Legislature calls them “Outer States.”

The $52.7 billion budget carried one hundred and ninety-three out-of-pocket provisions that have little to do with the federal budget. However, another external part of the budget also affected insurance representation on the Commonwealth Automobile Reinsurers (CAR) Committee, thanks to the persistent efforts of the Massachusetts Association of Insurance Agents (MAIA) and President and CEO Nicholas Fyntrilakis.

The amendment to the law frees up two seats on the Board of Directors reserved for sole proprietorships

The amendment to the rules regarding the CAR Board of Supervisors removed the restrictions that reserved two of the six seats of the Board of Supervisors that were given to insurance agents for “producers who are assigned to create risks that write personal automobile insurance through the Massachusetts auto accident plan.”

Since the introduction of less competition in 2008 and the return of the voluntary insurance market in Massachusetts health, producers who “write private car insurance through… (Emphasis added).

The members of the Governing Board are appointed by the Insurance Commissioner

The CAR Management Committee oversees the commercial vehicle pool and personal lines assigned to the risk plan. Prepares and implements Work Plans and Rules and implements and maintains any changes to Rules or Work Plans.

The Management Committee should have a boundary between the members of the insurance company and the agents. By law, the Steering Committee has thirteen members appointed by the insurance director: six members from motor insurance companies and six members from insurance companies. Thirteenth must come from domestic insurers with less than 2.5% of the Massachusetts auto insurance market.

The appointed bodies of the Board of Directors are vacant due to the lack of qualified manufacturers who only underwrite the insurance of the vehicles at risk.

In 2018, the term of the last member of the Management Committee who was qualified to be a producer writing only through the accident plan that was assigned to him ended, and he was not replaced. See the January 29, 2019 Agency Checklists article, “Governor Baker Recognizes Longtime CAR Steering Committee Member Sumner Gilman.” The result was that the two seats reserved for self-dangerous people in the Steering Committee were not filled. The legal relationship between agents and insurers, instead of being seven to six, became seven to four until now.

Legal reform ensures adequate representation of agents and their insurers

Over the past four years, the used car market in Massachusetts has been stable. However, there is no guarantee that any market will be stable at all times. Re-establishment of funds between insurers and agents on the CAR Steering Committee, as the rules supported by MAIA are, to ensure that the Steering Committee will fully represent the interests of the sponsor and the motorists.

An external section allowing the filling of all the seats of the Governing Board given to delegates

The bill that the MAIA shepherded through the Legislature removed the language in the CAR’s authorization act that prohibited the appointment of assistants to the CAR’s Board of Directors. The Section 79 Exemption page is below.

Print Better, PDF & Email