Understanding insurance surcharges: Massachusetts Auto Insurance Safe Driver Insurance Plan
Massachusetts has a Safe Driver Insurance Plan (SDIP) which is supposed to lower insurance costs for good drivers and raise rates on high-risk drivers such as those who speed, are involved in accidents or are cited for traffic violations through a system of credits and surcharges. Four coverages -- three compulsory and one optional -- may be raised or lowered under SDIP: Bodily Injury to Others, Personal Injury Protection, Damage to Someone Else's Property and Collision. Hiring experienced counsel can result in a reversal of SDIP.
SDIP credits or surcharges are reflected in a SDIP Statement that is normally provided by your insurer. The Statement uses reference points or steps, to translate your driving record into a numerical measure that determines whether you merit a credit or must pay a surcharge. Here's how it works:
All drivers begin at Step 15, which has no effect on premiums.
Each step above or below Step 15 has a 7 percent effect on the three compulsory rates and a 5 percent effect on collision premiums.
Each year of incident-free driving normally earns a credit point. The most you can accumulate is 6, meaning that the lowest Step you can reach is 9. This would produce a 42 percent savings in each of the three compulsory coverages linked to SDIP, and a 30 percent reduction in collision.
Accidents and traffic violations can produce surcharge points that stay on your record for six years and show up on your Statement for five years. Surcharge amounts include 2 points for a traffic violation, 3 points for a minor at-fault accident and 4 points for a major at-fault accident (the dividing line is $2000 in claim payments). For a major traffic violation, such as drunk driving, the surcharge is five points. These events generate a Surcharge Notice from your insurer.
Incident Surcharge Points "Minor" Traffic Law Violation such as speeding 2 Minor At-Fault Accident (under $2000 of damage) 3 Major At-Fault Accident (above $2000 of damage) 4 Major Traffic Law Violation includes: Operating to endanger and OUI. 5
Despite earlier surcharges, three consecutive years of incident-free driving will earn you a Step 14 rating under the state's "Clean Slate" program.
All drivers carried on your family's insurance policy are included in the SDIP, and if even one of them carries surcharge points, it could wipe out the credit points of other family members. Make sure you understand how your particular insurance situation might be affected by SDIP points.
The SDIP program is run by the state's Merit Rating Board. You can appeal a Surcharge Notice to the Board of Appeal Division of Insurance. You may have a lawyer represent you. You should be aware the the findings of the board can be used in related lawsuits such as a personal injury claim.
For further insurance surcharge information please contact Commonwealth of Mass, Merit Rating Agency 617-351-4400. To hire counsel: Contact a Lawyer from Speeding Ticket Defense
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