Progressive entering Mass. auto insurance market

Progressive Insurance will begin offering auto insurance to Massachusetts drivers May 1, the company said. Progressive, which sells more auto insurance through agents than any other firm in the United States, said it wanted to enter the Massachusetts market quickly under the new managed competition system put in place by Insurance Commissioner Nonnie S. Burnes.

"We appreciate the work the division has done to create a regulatory environment that allows companies to compete for customers," said Cathy Wilton-Bransch, Massachusetts product manager for Progressive.

Progressive already sells commercial auto insurance in Massachusetts. Starting in May, individual consumer will be able to purchase policies through the company's website, progressive.com. Next year, it plans to have a network of agents in place for consumers who want to buy policies from local agents.

The insurer, based in Mayfield Village, Ohio, claims its rates will be 18 percent lower than the "average rates" paid by Massachusetts drivers in 2007.

Previously, auto insurance rates were set by the Division of Insurance, and insurance companies had little flexibility to vary from the approved prices. Under the new system, companies set their own rates, which go into effect unless they are challenged and disallowed by the insurance commissioner. Drivers whose policies renew April 1 will be first to obtain the lower rates set under the competitive system.

Proponents of managed competition claimed that the new system would draw additional companies into the Massachusetts market, increasing choices and leading to more price competition.
(By Jeffrey Krasner, Globe staff)