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Massachusetts Car Insurance

Written by Michele Wilmonen. Posted in Research Last Updated: 09/28/2014

While the number of Massachusetts car insurance requirements is high, some of the actual required coverage amounts are ridiculously low.

State Regulator Information 617-521-7794 www.state.ma.us/doi
Insurance Premium Avg. Annual Premium: $ 1,604 National Average: $1,503
Mandatory Car Insurance Coverage Bodily Injury Liability:$20k/40k
Property Damage Liability: $5k
UMBI: $20k/40kPIP: $8k
massachusetts car insurance

A small state with big insurance requirements.

Massachusetts requires 4 separate insurance coverages for its drivers before they can hit the road. Now, compared to other states that only require 2 coverages this may seem to be a lot more coverage; but the numbers may surprise you. While there are a higher number of separate coverages required, the amounts that are required for each of the coverages is only average or much lower than other states require.

Massachusetts Car Insurance Requirements

The first coverage that you are required to carry is bodily injury liability coverage. This coverage pays for the injuries you cause to other drivers. For Massachusetts car insurance you are allowed to carry no less than $20,000 in coverage for the medical expenses of one person. You also can have no less than $40,000 in coverage for all medical expenses that result from an accident where you injure more than just one person. This is about average compared to what other states require.

The coverage that pays for your injuries, regardless of who caused the accident, is personal injury protection (PIP). You are allowed to purchase no less than $8,000 of coverage; which also runs about average with the states that actually require this coverage.

Uninsured Motorist coverage is also required with Massachusetts car insurance at the same minimum limits as bodily injury liability coverage. However, this coverage is not to cover another person; this is to protect you. In the event you are in an accident with a hit-and-run driver or a person that has no insurance, this coverage will pay for your medical expenses.

Now, I have saved the most ridiculous for last. With all of the coverage you are required to buy for your Massachusetts car insurance, you would think that it would be because Massachusetts is a state that is being overly protective of their drivers and resources.

However, when you look at the big picture, all of the required coverage is for medical expenses; except one. So, they are just protecting themselves and the medical profession that lobbies the state government from having to be stuck with medical expenses from car accidents that people cannot pay.

How else would you explain that with all of the coverage they require for medical expenses that they only require people to carry a laughable minimum amount of $5,000 in coverage for property damage you may cause?

Massachusetts Car Insurance Managed Competition

In 2008, the insurance industry in Massachusetts was essentially set free by a new process called “managed competition”; in other words, they were deregulated.

What does this mean? It means that the insurance companies that wrote insurance in the state were given the freedom to set their own insurance rates, instead of having the rates regulated by the state.

So, insurance companies set rates to where they saw fit, dropped and added discounts, and started rating drivers by different factors than what was previous allowed by the state. This meant that a lot of drivers saw an increase in their Massachusetts car insurance premiums.

Shop Around for Massachusetts Car Insurance

With managed competition every insurance company now has largely different premiums, discounts, and programs. So, the premium you are quoted from one insurance company can be nothing like the quote you get from the next insurance company.

Managed competition makes it so very important that you never settle with your first quote. You need to shop around for no less than 3 different Massachusetts car insurance quotes before you settle for the right coverage and premium.

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Michele Wilmonen

Michele's first introduction to insurance was working for a major insurance company as a file clerk and a mailroom supervisor in a regional office. She learned insurance directly from underwriters and claims adjusters from questions and also watching them do their job. Since then, she's earned a number of insurance certifications from the Insurance Institute of America and also a Bachelor’s degree from the University of Idaho. She blogs at Car Insurance Guidebook.

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