BOSTON (AP) - In the old days, the attorney general played a starring role in the state's annual auto insurance rate-setting ritual. But Martha Coakley is finding that under the state's new "managed competition" system, defining that role is proving far trickier.
Under the old system, the state's top law-enforcement officer typically cast himself - until Coakley it was always a "he" - in the role of defender of all car owners, pushing for deeper cuts or smaller increases than the insurance industry wanted.
It was a politically envious position. The final decision was in the hands of the state's insurance commissioner, but the attorney general could play consumer advocate.
Last year, amid a heated contest for the Democratic nomination for governor, Attorney General Thomas Reilly called for an 18.2-percent cut in auto insurance rates - enough to reduce the average driver's policy by about $180 per year. That was significantly steeper than the 8.3-percent cut recommended by the statistical arm of the state Division of Insurance, or the 3.7-percent cut submitted by the auto insurance industry itself.
All three recommendations were handed off to the insurance commissioner, who made the final call - the cut was 11.7 percent. But that was then.
When Massachusetts decided to stop being the only state to set a single rate for all insurers, it meant big changes for drivers, insurers and the attorney general.
Under the new system, insurers file individual rates with the insurance commissioner. Those rates become effective unless the commissioner objects.
The attorney general has a more limited role, retaining the right to trigger hearings on individual insurer rate filings when she decides they are needed to protect consumers.
Coakley says she supports the new, more competitive system, but isn't abandoning her job of protecting consumers, in part by issuing a series of public informational "bulletins." She's released four such "bulletins" in the past two months.
In the first, on Nov. 14, Coakley criticized the way the industry calculated suggested advisory rates for companies that insure less than 1 percent of the market. She also proposed rates for drivers unable to obtain insurance in the open market.
In another, she faulted insurers for proposing what she calculated would be a 6 percent statewide average decline in rates, compared with a more generous 7.7-percent cut projected by Insurance Commissioner Nonnie Burnes.
Coakley argued consumers could have expected a bigger reduction had the state used its old rate-setting system, and said the insurers' rate proposal included more than $200 million in extra profits and payments to agents that wouldn't have been allowed under the old method.
Coakley also has ordered three major auto insurers to defend their proposed rates at public hearings. She said the proposals from Commerce Insurance, Premier Insurance and Safety Insurance would collectively overcharge Massachusetts drivers by more than $100 million. The AG says she's only protecting the interests of consumers, while at the same time guaranteeing the shift to a competitive system is done fairly.
"While we support the goal of competition in the automobile insurance market, it is the attorney general's responsibility as the ratepayer advocate to ensure that competition is introduced in a way that does not have a negative impact on consumers," Coakley said in her most recent bulletin.
Coakley says the goal isn't to return to the old, one-size-fits-all, system, but to ensure "a transparent process so that consumers can make an informed decision when they purchase insurance."
Burnes has given generally high marks to the state's 19 insurers. Based on filings submitted last month, she has said at least 1.2 million of Massachusetts' 4 million motorists will see a 10 percent cut or better.
"The very good news is that every company filed for an average rate decrease," Burnes said last month. "We are seeing what appears to be very substantial deductions for good drivers."
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Steve LeBlanc covers the Statehouse for The Associated Press.
