AASP/MA Announces Standardized Auto Policy Has Been Withdrawn
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AASP/MA Pressures Automobile Insurance Bureau to Withdraw Standard Auto Policy

The most alarming change to the model policy is the addition of language which states “the cost to physically repair the auto is the competitive price, which we secure from a licensed repair facility under our direct payment plan.”


Due to overwhelming pressure from the Alliance of Automotive Service Providers of Massachusetts (AASP/MA) and the Statewide Towing Association of Massachusetts (STA), the Automobile Insurance Bureau (AIB) has withdrawn their recently filed standard auto policy. AASP/MA and STA felt that the policy had many issues related to labor rates, towing and storage, and others.

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A new policy has been filed by AIB to replace the previous filing, but it must go through the Rating Bureau review process before being “placed on file” with the Division of Insurance. AASP/MA and STA state that they will remain vigilant during this review process and take every appropriate opportunity to weigh in on the policy.

Since becoming aware of AIB’s policy changes, the associations have been working closely together on behalf of their memberships and the consumers of the Commonwealth.

The policy contained the following issues:

Labor Rate

The most alarming change to the model policy, says AASP/MA, is the addition of language to the collision, comprehensive and limited collision section which states “the cost to physically repair the auto is the competitive price, which we secure from a licensed repair facility under our direct payment plan.”

  • AASP/MA understands (and AIB has confirmed) that this new language means that the insurer will calculate its rate, for all body shops in the Commonwealth, based on only its referral shop program. Even if a consumer’s shop is not within the insurer’s direct payment plan, the consumer’s chosen body shop will automatically get their “competitive rate.”
  • While consumers assume the actual cost to repair their vehicle will be covered at the time of an accident, this language change leaves consumers having to pay the difference between the actual labor rate and the rate of reimbursement.

Towing and Storage


If a consumer’s motor vehicle is towed or stored, the new model policy states an insurer will only pay for amounts dictated by the Department of Public Utilities (DPU) relative for involuntary/ trespass towing. These rates are set at a maximum rate for involuntary towing or trespass towing at $90; while the storage rate for an involuntary tow is $35 a day, plus extra labor (if needed.)

  • Since the DPU cannot regulate the rate of voluntary tows nor do they regulate non-tow related service rates due to federal preemption, the aforementioned rates do not reflect the actual market rate for services rendered relative to a motor vehicle incident involving collision or comprehensive claims or voluntary towing. As a result, a policyholder will be responsible for any additional towing costs or costs for special equipment and illicit discharge cleanup, like antifreeze spills or oil cleanup.
  • As auto insurance costs continue to climb, insureds are often unaware that these proposed changes, relative to towing and storage rates, result in less coverage and increased liability.

Damage to Someone Else’s Property


The model AIB policy includes new language stating, “The amount we will pay does not include compensation for physical damage to your auto or towing or recovery of your auto…”

  • If a consumer’s vehicle is in an accident in which there is property damage, for example, the vehicle hits a fence, guardrail, sign, house, lands in a pool or skids off the roadway and becomes stuck. Under the previous standard policy, the recovery/extrication, cleanup and towing of the vehicle would have been covered under the Compulsory Section – Damage to Someone Else’s Property. This change will leave motor vehicle owners responsible for all costs associated with removal of their vehicle and restoration of the property to pre-accident condition.

Bodily Injury  


The model AIB policy includes new language that “[i]nsurers will not pay punitive or exemplary damages.” AASP/MA states that this new language has troubling implications for both individuals who have caused accidents and, more importantly, individuals injured as a result of an accident.

  • Consumers, who are accustomed to their insurance indemnifying or covering them for certain damages incurred as a result of an accident, may no longer have those same protections. A large reason for mandating insurance in the first place is to ensure that motor vehicle owners are able to pay for any injuries caused or, alternatively, for injuries received. The model language, again, will cost consumers more money in the event of an accident.

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