Mass. rejects FAIR Plan insurance hike

BOSTON – The Mass. Division of Insurance last week rejected a rate request that Attorney General Martha Coakley said would have cost homeowners an additional $16 million in policy premiums.
Coakley had argued that the home-insurance rate increases proposed by Massachusetts Property Insurance Underwriting Association – known as the FAIR Plan – were “excessive” and would affect 150,000 families.
Jointly run by the state’s property-insurance companies, the FAIR Plan is a residual market designed to provide coverage at reasonable rates to homeowners who cannot obtain it in the open marketplace. This includes about 50,000 families in urban areas, and 80,000 families on Cape Cod and other coastal communities, where insurance companies frequently decline to issue home-insurance policies. The law requires that rates through the FAIR Plan are approved by the state commissioner of insurance and are not excessive.
The insurance industry sought the commissioner’s permission to raise rates for the FAIR Plan by an average of 6.8 percent across the state, and by more than 9 percent in New Bedford, among others. •

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