Insurers, consumer advocates clash over PIP reforms and insurance surcharge points at State House hearing
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Summary
Industry witnesses urged the Legislature to pass House Bill H1088 to limit incentives for bulk PIP suits; another bill, H1197, would prevent surcharges for low-damage accidents. Insurers said pervasive bulk lawsuits are clogging district courts and raising premium indicators; consumer advocates' testimony was limited at the hearing.
Representatives of insurers and trade associations pressed the joint hearing to act on legislation they say would curb a surge of no-fault personal injury protection (PIP) lawsuits and prevent insurers from increasing surcharge points for minor-damage accidents.
Christopher Stark, executive director of the Massachusetts Insurance Federation, urged support for House Bill H1088, describing it as a return to "the legislative intent of our statutory scheme for personal injury protection." Stark said the bill would require insurers to tender amounts due within 30 days after service of a complaint without becoming liable for attorneys' fees, a change he said would deter the development of a "cottage industry for payment collection by attorneys." "This legislation simply states that from the date of the service of a complaint, an insurer has 30 days to tender amounts due and payable without being responsible for attorneys' fees," Stark said.
Speakers from Arbella and MAPRA described a rapid rise in PIP suits they attribute to out-of-state law firms filing high volumes of claims in Massachusetts. One Arbella representative said that suits that were rare a few years ago have doubled year-over-year and that one Florida-based firm filed hundreds or thousands of matters that are now clogging district courts. Speaker testimony described instances where insurers were forced to hire litigation counsel and divert staff to respond to bulk filings; in many cases, insurers say most claims are defensible or beyond statutory time limits.
Attorney Derek Buckley offered examples of procedural delays and filings that were ultimately dismissed but required costly defense work and months or years of litigation: "I sent emails from May all the way till September, and I never got a response to the point where I had to file a motion for, motion to dismiss," he said, describing a case that proceeded to jury trial only to be decided in the insurer's favor after presentation of documentation.
Separately, a witness identified as a doctor testified in support of House Bill H1197, which would prevent the commissioner of insurance from increasing surcharge points in instances where damage did not exceed $2,500. The witness said the bill "aims to protect drivers across the Commonwealth from excessive insurance surcharge points for those deemed at fault for motor vehicle accident within the minimal damages." He said the change would protect drivers with minor-damage accidents while preserving accountability for high-damage crashes.
No committee votes were taken at the hearing. Witnesses said they would submit written testimony and data to supplement their oral remarks.
Ending: Insurer witnesses asked the committee to report the PIP bill favorably and to study the effect of high volumes of PIP suits on premiums and court resources; other witnesses urged changes to surcharge rules for low-damage accidents.