Transcription
Commonwealth of MassachusettsInstructions to Applyfor Authority to SellPrivate PassengerAutomobile Insurance inMassachusettsA Guide for Insurance Companies
Instructions to Apply for Authority to SellPrivate Passenger Automobile Insurance inMassachusetts: A Guide for InsuranceCompaniesPublished August 2008 by theMassachusetts Merit Rating Board inconjunction with the Massachusetts Divisionof Insurance and the Registry of MotorVehicles.5th Edition, revised October 2018.For additional copies of this guide, pleasecall the Merit Rating Board at 857-368-7600or go to www.mass.gov/merit-rating-boardmrb to download a PDF version.Commonwealth of Massachusetts
Page 1elcome to the Massachusetts competitive private passenger automobile insurancemarket. The following information is designed to guide automobile insurancecompanies through the process of obtaining a license to sell private passengerautomobile insurance in the Commonwealth. The steps outlined below provide anoverview of the process. Following the steps is a description of the various agencies andorganizations involved in licensing and regulating the Commonwealth’s privatepassenger automobile insurance industry. While this guide is intended to becomprehensive, insurers are advised nevertheless to contact each agency ororganization to make certain that all requirements are met.Procedure for Obtaining a License1 Complete a UCAA Application. The3 After the UCAA Application hasDivision of Insurance (DOI) accepts theUniform Certificate of Authority ExpansionApplication for those companies seeking toamend their license to include the licensedesignations needed to sell private passengerautomobile insurance in Massachusetts. TheUCAA applications are available at http://www.naic.org/industry ucaa.htm.2 Send the completed application to:Robert MacullarDivision of Insurance1000 Washington Street, Suite 810Boston, MA 02118-6200Phone: 617-521-7398Email: Robert.Macullar@state.ma.usAll questions regarding the applicationshould be directed to Robert Macullar.Once the application has beensubmitted, it is assigned to an analyst toreview.been reviewed, the DOI may grantan initial approval. The applicantcompany will receive notification inwriting of the initial approval, alongwith instructions to complete thefollowing items:Submit original documentation ofadvertisement in two insuranceindustry publications for twoconsecutive issues. New license applicants will berequired to make a special deposittotaling 100,000 confirmed by theMassachusetts Treasurer and ReceiverGeneral. Submit a properly executed Power ofAttorney. The DOI will provide thecorrect form with the letter of initialapproval. Submit a properly executedDeclaration and Agreement. The DOIwill provide the correct form with theletter of initial approval.
Page 2 Contact Information:John MetcalfeDirector of Residual Market Services101 Arch Street, Suite 400Boston, MA 02110Phone: 617-880-7291Email: jmetcalfe@commauto.comWebsite: www.commauto.com 4 Contact the Registry of Motor VehiclesRegistration Department.Contact Information:RMV Registration ManagerRegistry of Motor VehiclesPhone: 857-368-7568Email: Elizabeth.Rizzuto@state.ma.usJoin the Massachusetts InsurersInsolvency Fund. This applies to allkinds of direct insurance, with thefollowing exceptions: life, accident andhealth, title, surety, disability, credit,mortgage guaranty, financial guaranty, orother forms of insurance offeringprotection against investment risks,insurance of warranties of any type ofservice contracts, and ocean marineinsurance.Contact Information:Massachusetts Insurers InsolvencyFundOne Bowdoin Square, Floor #2Boston, MA 02114Phone: 617-227-7020 company must submit. The checkshould be made payable toCommonwealth of Massachusetts,Division of Insurance. Indicate on thecheck stub the name of the companyfor which the payment is made andthat it is for the issuance of a newlicense to a company.Obtain membership in CommonwealthAutomobile Reinsurers (CAR). Allcompanies licensed for automobileliability (6G) designation must obtainmembership in CAR. Once the company isappropriately licensed in Massachusetts,CAR will issue a 3-digit number for datareporting.Submit the correct company license fee.This fee usually is 250, but may be 279, depending on the other licensedesignations on the company license.The DOI will specify which license fee aMassachusetts statute (Chapter 175,Section 113A of the General Laws)requires that all registered vehicles beinsured. Consequently, the Registryof Motor Vehicles (RMV) mustaffirm insurance coverage prior toissuing or renewing a registration.Insurance companies provide proofof an individual’s or corporation’sinsurance coverage with a companyspecific insurance stamp thatindicates the dates of policy coverageand the signature of the insurancecompany’s agent or representative onRMV registration forms.Page 3 The Registration Department will providespecific guidelines related to insurancestamps and registration policies andprocedures. Insurance companies havethe option of using a rubber stamp or anelectronic insurance stamp.
Page 3 CAR will notify RMV’s IS Securityabout the applicant company’s recentapproval to provide automobile insurancein Massachusetts. IS Security will thensend an email directing companies to theGuidelines for Reporting InsurancePolicies. The guideline gives generalprocedural information that describes theavailability of both batch and onlineaccess requirements and the UninsuredMotorist System (UMS) program.Questions about the information in thispacket should be directed to the UMSDepartment of the Registry of MotorVehicles at 857-368-9770.contracting a service provider thatruns guest software). To requestonline access, send a written requeston company letterhead, along withthe completed forms from theguidelines, to:RMV IS Security25 Newport Avenue ExtQuincy, MA 02171 To find out more about howinsurance companies reportelectronically to the RMV, visit:www.massrmv.com/rmv/ums.UMS processing is done via a batch FTPprocess. New companies are required totest their batch process prior toimplementation. Insurers ready to testtheir batch FTP process with the RMVshould contact:Production ControlRegistry of Motor Vehiclesprodcontrol@massmail.state.ma.us All private and commercial automobileinsurance policies must be reportedelectronically to the RMV via batch FTPprocess. New policies must be reportedwithin twenty-three days of the policyeffective date. Existing policies must bereported ninety days prior to eitherrenewal or cancellation.New insurers may request access toonline screens. The Guidelines forReporting Insurance Policies hasinformation pertaining to the differentonline access methods (VPN, guestsoftware via AT&T Global, orThe UMS enables insurance companiesto perform transactions that includecancellations, reinstatements, newbusiness, and registration and licenseinquiries.
Page 4Contact Information:Laurie JarvisPhone: 857-368-7603Email: Laurie.Jarvis@dot.state.ma.usWebsite: www.mass.gov/merit-ratingboard-mrbThe Merit Rating Board maintains acomprehensive database of traffic lawviolations and automobile insurance claimrecords for all operators licensed inMassachusetts.5 Contact the Merit Rating Board.Regulation 211 CMR 134.00 requiresall insurance companies writing privatepassenger automobile insurance inMassachusetts to report auto insuranceclaims and out-of-state driving recordsto the Merit Rating Board (MRB).Insurers report this data via the MRB’sInternet FTP site. Insurers may also usethe MRB’s FTP site to obtain operatordriving history records. Insurance companies must register bynotifying the Merit Rating Board inwriting of the insurer’s designation ofan Insurance Company Merit RatingBoard Liaison. The Liaison will be theprimary contact representing theinsurance company.The Insurance Company MRB Liaisonis responsible for obtaining the requiredpassword for data transfer between theinsurer and the Merit Rating Board. TheLiaison must complete the MRBInternet FTP Site Username andPassword Application Form.6 Contact the Automobile InsurersBureau (AIB). The AIB administers theDetail Claims Database (DCD), a recordof key information on closed automobileinjury claims. All insurers with claims Page 4against Massachusetts commercial andprivate passenger automobile policiesmust report specific claim data to theDCD on a monthly or quarterly basis. Forreporting requirements, contact:Andrew J. Dempsey, CPCUUnderwriting Services AdministratorAIB of Massachusetts101 Arch StreetBoston, MA 02110Phone: (617) 439-4542, x7706Email: ADempsey@aib.orgWebsite: www.aib.org7 Contact the Insurance Fraud Bureau(IFB). The IFB investigates fraudulentinsurance transactions and prepares casesfor criminal prosecution. For insurancefraud reporting requirements and forinformation on fraud training inMassachusetts, contact:Deborah Terry, Administrative ManagerPhone: (617) 439-0439Email: dterry@ifb.orgWebsite: www.ifb.org
Page 5Page 5Organizations and State Agencies Involvedin Licensing and RegulationInsurance companies entering theMassachusetts private passengerautomobile insurance market willbecome familiar with variousorganizations and state agencies.Some of these organizations andagencies and their role in licensingand regulating private passengerautomobile insurance in theCommonwealth are described below.The Division of Insurance (DOI)administers the laws of theCommonwealth of Massachusetts asthey pertain to the protection of theinsurance consumer through theregulation of the insurance industry.The DOI monitors financial solvency,licenses insurance companies andproducers, reviews and approves ratesand forms, and coordinates thetakeover and liquidation of insolventinsurance companies and therehabilitation of financially troubledcompanies. The DOI also investigatesand enforces state laws andregulations pertaining to insuranceand responds to consumer inquiriesand complaints.Commonwealth AutomobileReinsurers (CAR) is the industryoperated residual market andstatistical agent for motor vehicleinsurance in the Commonwealth ofMassachusetts. In its role as theadministrator of the residual market, CARprovides access to private passenger andcommercial motor vehicle liability andphysical damage insurance to thatsegment of the state’s motoring public thatis unable to obtain automobile coveragethrough the voluntary market. As thestatistical agent, CAR collects, edits, andprocesses Massachusetts private passengerand commercial automobile premium andloss statistics.Every company that is licensed to writemotor vehicle insurance in Massachusettsis required to become a member of CAR.Companies that actively writemotor vehicle insurance will be requiredto participate in the residual market poolfor the line of business in which theywrite. Participation specifics differdepending on the line of business, privatepassenger or commercial automobile, inwhich they write.In its role as statistical agent, CAR collects,edits, and processes Massachusetts privatepassenger and commercial automobilepremium and loss statistics.
Page 6Actively writing Massachusettsautomobile insurers must reportstatistical information to CAR. CARprovides this data to the AutomobileInsurers Bureau of Massachusetts,the Merit Rating Board, and theHighway Loss Data Institute. Theseorganizations use this data forinformational purposes, for statisticalanalyses, and in the ratemakingprocess.To verify accuracy and completenessof its statistical database, CARreconciles reported statistical data tocompany financial statements andperforms an analysis that compareseach company’s distribution of datato the industry’s distribution. Fordata reporting obligations, the CARcontact person is Wendy Browne,Vice President, Business Operations.The Registry of Motor Vehicles(RMV) is the agency responsible fordriver licenses, vehicle registrationsand titling processes, and enforcingvehicle safety. The RMV also isresponsible for the administration ofthe Uninsured Motorist System(UMS). The UMS is part of theAutomated License and RegistrationSystem (ALARS). ALARS consistsof multiple components, includinglicensing, registration, title,suspensions, accident records,inspection maintenance, non-renewal, policy information, and MeritRating Board information.The UMS is intended for use by theinsurance industry and allows forelectronic processing via batch FTPprocessing and/or online screens of privateand commercial insurance policies. UMSenables insurance companies to performtransactions that include cancellations,reinstatements, new business, renewals,amendments, and clear unpaid dollaramounts. In addition, informationalinquiries can be performed on registration,license and title information, customeraddress information, as well as MeritRating Board information related to theSafe Driver Insurance Plan.The UMS enables the Registry of MotorVehicles to verify that Massachusettsdrivers have motor vehicle insurance.
Page 7The Merit Rating Board (MRB)maintains a comprehensive database oftraffic law violations and auto insuranceclaim records for all Massachusettslicensed operators. Insurers areprovided unlimited access to theMRB’s extensive database via an FTPInternet site batch inquiry process,enabling them to access a large volumeof information quickly and efficiently.The same process is employed forinsurers who must obtain drivinghistory records from the MRB for allMAIP policies. MAIP, or theMassachusetts Automobile InsurancePlan, provides private passenger motorvehicle insurance to eligible risks whoare unable to obtain such insurancethrough the voluntary market.To ensure that the MRB’s databaseremains accurate and complete,insurers are required to report autoinsurance claims records, regardlessof accident location, and out-ofstate driving records to the MRB, incompliance with Regulation 211CMR 134.00.The Automobile Insurers Bureau ofMassachusetts (AIB) is licensed bythe Massachusetts Commissioner ofInsurance to act as a ratingorganization for automobile insuranceunder the provisions of MassachusettsGeneral Law Chapter 175A. The AIB is aninsurer-sponsored organization thatrepresents the insurance industry inmatters relating to private passenger andcommercial automobile insurance byworking with state regulators and makingadvisory filing on rates, policy forms,endorsements, and rules on behalf ofauthorizing members.The AIB also administers the Detail ClaimDatabase (DCD), which is a uniquecollection of key information on closedautomobile injury claims. All insurers withclaims against Massachusetts commercialand private passenger automobile policiesare required to report specific claim data tothe DCD on a monthly or quarterly basis.Submissions of claim data are accepted viaFTP, CD, and diskette. AIB membercompanies may have access to all DCDclaim detail through internet and batchinquiries on claimants and insureds, aswell as summarized and detailed reportson injuries, treatment providers, payments,and claim handling practices used inordinary claim handling and theinvestigation of suspicious claims.The Insurance Fraud Bureau (IFB) is aninvestigative agency authorized by an act ofthe Massachusetts legislature and dedicatedto the investigation of fraudulent insurancetransactions and the preparation of cases forcriminal prosecution. The IFB is
Page 8wholly funded by the insurance industry, andits staff works with the insurers’ claim andinvestigative personnel and local, state, andfederal law enforcement agencies in theprevention, investigation, and prosecution offraudulent insurance activity.Contact Information:Insurance Fraud Bureau101 Arch StreetBoston, MA 02110-1131Phone: (617) 439-0439Fax: (617) 439-0404Web site: http://www.ifb.orgMassachusetts Insurers Insolvency Fund,created by Massachusetts statute (Chapter175D, Section 3 of the General Laws), is anonprofit, unincorporated legal entityconsisting of all insurers writing liability andproperty insurance in the Commonwealth. Itis available to settle up to 300,000 per claimthat arises from an insurance policy issued byan insolvent insurer. The Fund’s obligationsand expenses are met by mandatorycontributions by all liability and propertyinsurers who write insurance inMassachusetts. The Fund’s powers areexercised through a board of directors.Contact Information:Massachusetts Insurers InsolvencyFundOne Bowdoin Square, Floor #2Boston, MA 02114Phone: 617-227-7020
Page 9CHECKLIST FOR COMPLETINGMASSACHUSETTS LICENSING REQUIREMENTS Complete a UCAA Application and send it to the Division of Insurance.Submit original documentation of advertisement in two insurance industry publications.Make a deposit of 100,000, confirmed by the Massachusetts Treasurer and Receiver General.Submit a properly executed Power of Attorney.Submit a properly executed Declaration and Agreement.Obtain membership in Commonwealth Automobile Reinsurers.Join the Massachusetts Insurers Insolvency Fund.Submit the correct company license fee.Contact the Registry of Motor Vehicles Registration Department to:Obtain stamp specifications and registration policies and procedures.Obtain the UMS Department informational packet; complete and return required forms.Test batch FTP process prior to implementation.Register with the Merit Rating Board by designating an MRB Liaison.Complete the MRB Internet FTP Site Username and Password Application Form.Contact the Automobile Insurers Bureau (AIB) for reporting requirements.Contact the Insurance Fraud Bureau (IFB) for reporting requirements.
Published by the Massachusetts Merit Rating Boardin conjunction with the Massachusetts Division of Insurance and the Registry of Motor Vehicles.
Oct 02, 2018 · Automobile Reinsurers (CAR). All companies licensed for automobile liability (6G) designation must obtain membership in CAR. Once the company is . Website: www.aib.org 7 Contact the Insurance Fraud Bureau (IFB). The IFB investigates fraudulent insurance transactions and prepares cases for criminal prosecution. For insurance
