In This Issue - Winter 2010

Residual Market News
Going Online
Commonwealth Automobile Reinsurers

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617-338-5422 - MAIP Security

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Residual Market News

Rule 21, C.1 Non-Renewals

The Applicant Screen of the MAIP Policy Application contains a section that asks if the applicant for a policy has been "non-renewed and meets the eligibility requirements of Rule 21, C.1."

The response to this question should be answered "NO" unless EITHER:

  1. the non-renewed policy was originally written while the producer of record was an Exclusive Representative Producer (ERP)
  2. the producer of record was a voluntarily contracted producer and the non-renewed policy was ceded to CAR. If it is unknown whether the policy was ceded, the question should be answered "NO".

Example 1
A producer was an ERP through March 2009 and obtained a voluntary contract effective April 1, 2009. All policies written prior to April 2009 would be eligible for Rule 21, C.1 processing, providing there was no money owed the company and the applicant was otherwise eligible for placement in the MAIP. Answer the question "YES" and indicate the effective year of the inception year (not the expiration/non-renew year) of the policy (i.e. no 2010 years).

Example 2
A producer was a voluntary producer with one or more companies. A policy that was ceded to CAR by any of these companies (must be policy effective dates prior to April 1, 2009) is eligible for Rule 21, C.1 processing, providing there was no money owed the company and the applicant was otherwise eligible for placement in the MAIP. Answer the question "YES" and indicate the effective year of the inception year (not the expiration/non-renew year) of the policy (i.e. no 2010 years).

Certification - Current Copy of Agency License

To maintain your agency MAIP certification as an Assigned Risk Producer, a copy of a current agency license must be on file at CAR.

In the near future, CAR will initiate a process that will begin with an email to agencies reminding them to provide a current copy of the agency license upon renewal. Based on our data records, CAR will send this reminder at the beginning of the month in which the agency license is to renew. Subsequently, agencies who fail to provide a copy of a current license by the specified date will be sent a second reminder at the beginning of the month following the agency license renewal date.

Agencies who fail to provide a current copy of an active agency license by the end of the month following the renewal date, will receive an email warning that the agency's MAIP certification will be suspended if a current agency license is not received within five business days. Failure to provide a current copy of the agency license within the five days will result in suspension of the agency MAIP certification. In addition, the agency will be unable to access the MAIP Policy Application until a current agency license is received and on file at CAR.

This reminder process, as well as all other correspondence between CAR and agencies, has been and will continue to be, email based. As a result, it is crucial that agencies provide and maintain accurate and up-to-date email address information with CAR. In addition, agencies should make sure that their email software is configured properly to avoid notifications from CAR being sent to spam and junk folders.

Going Online

One of the listed drivers, other than a named insured, has a suspended license that will be reinstated in a few weeks. Can I check the "Licensed Driver" checkbox on the Driver page?

No. Check the Licensed Driver checkbox only if the driver has an active Massachusetts license. Once you check this box, you will be able to enter license information about the driver.

If the named insured has a license that is currently under suspension, the risk is ineligible for placement in the MAIP.

Will I automatically receive a discount if I check the passive restraint checkbox?

Yes. The base premium calculation automatically includes this reduction. It will be noted on the Remarks page with the following message, "Base premium calculation includes reduction for passive restraint/airbag device."

Are there going to be any additional changes to the MAIP Policy Application?

Yes. A new update to the MAIP Policy application will require an ARP to fill in the Cost New (not purchase price) field on the Vehicle page when entering 2011 model year vehicles. Once a VIN look up has been completed on a model year 2011 vehicle, the Cost New field will be highlighted in red and a message will be provided on screen indicating that a value must be entered into the Cost New field. The MAIP application cannot be rated or assigned without this information.


On January 27, 2010, CAR distributed an email to all Agency Security Administrators requesting that the new, updated Agency Security Administrator Form be reviewed, signed, and returned to CAR. The form has been updated to include language related to the compliance with regulation 201 CMR 17.00 - Standards for the Protection of Personal Information of Residents of the Commonwealth, which becomes effective March 1, 2010. The form should be returned to CAR by Friday, February 12, 2010. Questions can be directed to the MAIP Support line at 617-338-4000.


Is an ARP required to collect outstanding unpaid premium owed as part of the premium deposit when placing business through the MAIP?

The Division of Insurance has determined pursuant to CAR rules, that the satisfaction of outstanding premium owed by the applicant is a condition of eligibility for placement through the MAIP, and not a requirement of the calculation of the premium deposit. Therefore, an ARP is not required to collect the outstanding owed premium. However, the applicant is required to satisfy any outstanding debt occurring within the previous 12-month period, prior to being eligible for placement in the MAIP, and an ARP may choose to assist an applicant in doing so. Specifically, an ARP may assist in satisfying this MAIP eligibility requirement by collecting the unpaid premium and forwarding it to the company that is owed this premium.

For down payment determination, an ARP is required to verify that the Eligible Risk (applicant and any other party who usually drives the vehicle) was not in default of, or currently does not owe outstanding premium for a policy that was in effect during the preceding 24 months.

Can a producer use the MAIP stamp to provide a courtesy stamp for a risk?

No, the MAIP stamp may not be used in courtesy stamping. If the producer represents the company insuring the vehicle, then the producer may use that company's stamp to courtesy stamp a registration on behalf of another producer.

What is the MAIP Performance Standards Non-Compliance Program?

The Assigned Risk Producer (ARP) and Assigned Risk Company (ARC) Non-Compliance Program provides for the reporting of infractions of the Performance Standards to CAR. The Non-Compliance Program is intended to ascertain the volume and types of violations being committed, uncover violations that may be particularly egregious, and recognize violation patterns requiring intervention. In order to make the process of reporting and responding to alleged violations easier for the industry and to provide a repository for this information, CAR developed a web-based application for reporting and responding to alleged violations of the Standards.

Additional Information on the Performance Standards Non-Compliance Program is available in the MAIP Policy Application Help

How does a producer file a response to a violation of the ARP Performance Standards and how much time does an Assigned Risk Producer have to respond?

A response must be entered into the Non-Compliance application. Access the application by:

  1. Logging into the MAIP from CAR's website:
  2. Clicking on the ARP Violation heading under Non-Compliance
  3. Clicking on the Respond/View function
  4. Clicking on the violation
  5. Entering the response and clicking on Submit Response.

An ARP has 20 calendar days to respond to a violation of the performance standards. If CAR does not receive a response within the 20-day period, the alleged violation will be deemed valid.

How does an ARP file a complaint against an ARC for violating the performance standards?

To access the Non-Compliance application to file a complaint an ARP must:

  1. Log into the MAIP from CAR's website:
  2. Clicking on the ARC Compliant heading under Non-Compliance
  3. Clicking on Choose an Assignment
  4. Clicking on the Report Compliant
  5. Entering the compliant and clicking on Submit Complaint.

A MAIP policyholder was denied physical damage coverage by the assigned ARC because the pre insurance inspection was performed by a vendor not utilized by the ARC. Does MAIP require vehicle pre-inspections be done by a particular vendor?

MAIP Rules do not mandate which vendors may by used to perform pre-insurance inspections. Vehicle pre-inspections are mandated by 211 CMR 94. The regulation authorizes the insurer to designate which vendors may be used to perform pre-inspections. Specifically, the regulation applies to private passenger motor vehicles insured in the Commonwealth of Massachusetts. Its purpose is to establish standards and procedures for the inspection of motor vehicles prior to an insurer's issuance of physical damage coverage. 211 CMR 94 defines inspectional services as any person or legal entity authorized by the insurer to perform these inspections. Therefore, the ARC is within its rights to deny physical damage coverage if the wrong vendor is utilized by the risk. However, 211 CMR 94 also includes a provision which specifies that once the insured has the vehicle inspected by the duly authorized party of the insurer, physical damage can be restored from the date of the inspection. Therefore, to avoid this type of situation, the ARP should check with the ARC receiving the assignment to assure that the pre-insurance inspection is being done by the ARC's duly authorized party.