The Impact of Rate Regulation on Claims : Evidence from Massachusetts Automobile Insurance

@inproceedings{Derrig2007TheIO,
  title={The Impact of Rate Regulation on Claims : Evidence from Massachusetts Automobile Insurance},
  author={Richard A. Derrig and Sharon Tennyson},
  year={2007}
}
The article tests the hypothesis that insurance price subsidies created by rate regulation lead to higher insurance cost growth. The article makes use of data from the Massachusetts private passenger automobile insurance market, where cross-subsidies were explicitly built into the rate structure through rules that limit rate differentials and differences in rate increases across driver rating categories. Two approaches are taken to study the potential loss cost reaction to the Massachusetts… CONTINUE READING