Disappearing Deductible Credits

Transcription

1 Disappearing Deductible Credits This Endorsement changes the policy. Please read it carefully. Eligibility This coverage applies if a premium is shown for your auto in the Coverage Selections Page for Collision or Limited Collision. This coverage is deleted if Collision or Limited Collision is deleted. Definitions Credits means the dollar value credits awarded by us to you to reduce your Collision, Limited Collision or Comprehensive deductible following certain claims. Credits may be used only as set forth in this Endorsement. Credits may not be redeemed for cash or any other thing of value. Clean Year means any twelve month policy period in which you have your auto insured by us and: (1) no operator was surcharged for an at-fault accident, and (2) the policy was free of hit and run Collision or Comprehensive loss payments greater than $500 for losses prior to July 1, 2015, or $1,000 for losses on or after July 1, Credit Awards You are awarded credits after one full clean year where no credits were used or lost. You will receive $50 in credits for each of the first four consecutive clean year(s) after the initial clean year up to this policy period. In the fifth consecutive clean year, you will earn a $100 credit. The maximum credits that you may earn is $300. Credits will be used to reduce the deductible amount you owe on a Collision, Limited Collision or Comprehensive claim greater than $500 to which your deductible applies. Your credits will be set to $0 if they are used during the policy period. Losing Credits Your credits will be lost and will be set to $0 during the policy period if: a. At any time you do not have Collision or Limited Collision coverage on at least one Auto covered by the policy; b. You or any operator listed on your policy is surcharged for an at-fault accident when there is no Collision or Limited Collision claim made; c. Your deductible is waived in whole or part by coverage in the Elite Package Endorsement; or d. The policy cancels with a lapse in coverage. If credits are used or lost, a new clean policy year must be completed before you are awarded credits again. The Coverage Selections Page shows the amount of credits, if any, that you have been awarded as of the most recent policy effective date. Using Credits Any existing credits will be used as long as you are not also eligible for coverage in the Elite Package Endorsement. If your deductible is waived in whole or part by the Elite Package Endorsement, that coverage prevails. CIC-2197 (05/16). Page 1 of 1

2 Vehicle Sharing and Public or Livery Conveyance Exclusion This endorsement changes the policy. Please read it carefully. We will not pay damages or benefits under any Coverage Part of your policy while your auto is: 1. In a vehicle sharing program. A vehicle sharing program includes the arrangement of the lease, rental or sharing of your auto with persons other than you or a household member for any type of compensation; or 2. Available for use as a public or livery conveyance, including use of your auto for hire through a ride sharing arrangement, or a Transportation Network Company (TNC) which operates under an agreement for compensation. This includes but is not limited to any period of time a vehicle is being used by you or any household member who is logged into a TNC as a driver, whether or not a passenger is occupying the vehicle. A TNC is defined as an online enabled application or digital network used to connect passengers with drivers using vehicles for the purpose of providing prearranged transportation services for compensation. This Exclusion does not apply to a share-the-expense car pool. CIC-2212 (05/16). Page 1 of 1

3 PERSONAL AUTO MA Auto ADVISORY NOTICE TO POLICYHOLDER VEHICLE SHARING AND PUBLIC OR LIVERY CONVEYANCE This is a Notice regarding your Personal Auto Policy. No coverage is afforded by this Notice. This Notice does not replace any provision of your policy. You should review your policy for complete information on the coverages you are afforded. If there are conflicts between the Policy and this Notice, THE PROVISIONS OF YOUR PERSONAL AUTO POLICY SHALL PREVAIL. Your policy excludes coverage for accidents that happen while your auto is being used: 1. In a vehicle sharing program; or 2. As a public or livery conveyance. This exclusion applies to all coverage parts. A vehicle sharing program includes the leasing, rental or sharing of your auto with persons other than you or a household member for any type of compensation. A public or livery program includes using your vehicle for hire through a ride sharing arrangement for any type of compensation. This includes but is not limited to a Transportation Network Company (TNC). The public or livery conveyance concept implies that a vehicle is being used for a commercial purpose which may involve a charge. Services available to the general public as a conveyance for a charge is an exposure that falls within the scope of the public or livery conveyance exclusion. A TNC is defined as an on-line enabled application or digital network used to connect passengers with drivers who use personal autos to provide prearranged transportation services for compensation. You should: Review your Personal Auto Policy and any applicable TNC or other insurance policy carefully; and Contact your insurance agent or broker to discuss potential gaps in insurance coverage under your policy and the TNC or other policy which may arise while participating in a vehicle sharing, or public or livery program. MA Auto PA800MA (05/16) Includes copyright information from Insurance Services Office, Inc., 2014 Page 1 of 1

4 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL

5 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL RULE 11. PREMIUM CALCULATION RULE The term MAIP premium below refers to MAIP Rates effective 10/1/13. Table A STEP Coverage Parts Part 1 Part 2 Part 3 Part 4 Part 5 Part 6 Part 7 Part 8 Part 9 1 Base Rate by Territory Code and Class Part 10 Part 11 Part 12 Total 2 Limited Collision Factor x 3 Liability/Model Year Symbol Factor x x x x x x x x 4 Base Rate by Limit 5 Increased Limits Factor x x x x 6 Deductible Factor x x x x 7 Glass Deductible x 8 Waiver of Deductible + 9 Extra Risk Factor x x 10 Years Licensed Factor x x x x x x x x x x x x 11 Risk Factor x x x x x x x x x x x x 12 Driver to Vehicle (include deferred driver) Factor x x x x x x x x x x x x 13 Household Level Factor x x x x x x x x x x x x 14 Loyalty Plus Factor x x x x x x x x x x x x 15 Annual Mileage Discount x x x x x x x x x 16 Multi-Car Discount x x x x x x x 17 Anti-Theft Discount x 18 Account Discount x x x x x x x x x x x x 19 Shop Smart Credit x x x x x x x x x x x x 20 Welcome Back Credit x x x x x x x x x x x x 21 Discount x x x x x x x x x x x x 22 Marketing Partner Discount x x x x x x x x x x x x 23 Good Student Discount x x x x x x x x x x x x 24 Student Away From Home Discount x x x x x x x x x x x x 25 Smart Driver Discount x x x x x x x x x x x x 26 DriveAdvisor Discount x x x x x x x x x x x x 27 Clean in Three Discount x x x x 28 Senior Discount x x x x x x x x x x x x 29 Merit Rating Adjustment Subtotal Coverage Package Capping Factor 32 Sumproduct of Step 30 and Step MAIP for selected Coverages in Coverage Package 34 Capping Amount (Step 30)*min[(Step 33 divided by Step 32)-1,0]*(Step 31) 35 New Subtotal (Step 30 +Step 34) 36 Auto Loan/Lease Coverage x x 37 Accident Forgiveness x x x x x x x x x x x x 38 Paid In Full Discount & Green (Pay Plan) Discounts x x x x x x x x x x x x 39 Commerce Elite Package Endorsement + 40 Commerce Enhancer Package Endorsement + Coverage Please note, for detailed calculation descriptions and factors within a step please see the specific sections of this manual. 7

6 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL Explanation of Steps 30-35: MAIP Capping (compliance with DOI Bulletin ) In order to comply with the Massachusetts Division of Insurance Bulletin , Rating Steps as found in Table A of Rule 11 ensure that for the Coverage Package not to Exceed MAIP in Effect October 1, 2013 identified in Bulletin , Exhibit 1, Commerce will charge no more than the MAIP premium for private passenger type vehicles as defined in Rule 27. The MAIP Capping calculation does not apply to miscellaneous type vehicles, including antique motor cars, antique motorcycles, motorcycles (incl. motor scooters, mopeds and similar motor vehicles), trailers and motor homes/camper bodies. This procedure will be calculated as follows: Step 30: Derive the manually rated premium by applying Steps 1 through 29 in Table A as found in Rule 11. This will be referred to in future rating steps as Uncapped Step 31: Determine the Coverage Package Capping Factor from Tables B.1 B.11, C, and D as found in Rule 11 applicable to each coverage based on the coverage limit selection for the rated vehicle. A factor equal to will reflect that the Coverage Part falls within the definition of Bulletin , Exhibit 1 and is subject to premium capping, a (zero) will reflect that the Coverage Part is not included within the definition of Bulletin , Exhibit 1 and is not subject to premium capping. Step 32: Multiply each Coverage Part s Uncapped by the Coverage Package Capping Factor as determined in Step 31. Add all Coverage Parts together. This total will be called Applicable Capped for the Rated Vehicle. Step 33: Determine the applicable MAIP for all Coverage Parts where the Coverage Package Capping Factor, as determined in Step 31, equals Sum all of the Coverage Part s premium. This will be referred to in future rating steps as Applicable MAIP Step 34: Determine the necessary reduction for each Coverage Part using the formula: Step 30 * MINIMUM ( [ Step 33 Step 32 ] 1.00, 0.00 ) * Step 31 or in words: Uncapped x MINIMUM of [ (A) Applicable MAIP Applicable Capped minus 1.00 ; (B) (zero) ] x Coverage Package Capping Factor Note: This value will always be either a Negative Amount or Zero for each Coverage Part. Step 35: Step 30 + Step 34 8

7 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL Tables B.1 through B.11, C, and D RULE 12. PREMIUM ROUNDING RULE The premium for each exposure will be rounded, separately for each coverage provided by the policy, as follows: 1. Steps 1 through 27, as provided in Rule 11, will be rounded to the penny after each step. 2, Step 28, 29 and will be rounded to the nearest whole dollar, For whole dollar rounding, a premium involving $0.50 or more will be rounded to the next whole dollar at the end of each step. This does not apply to Part 5, 20/40 limits and Part 6, $5,000 limit where rates may be used or rounded to the lower whole dollar. This procedure will apply to all interim premium adjustments, including endorsements or cancellations at the request of the insured. In the case of cancellation by Commerce, the return premium will be carried to the next higher whole dollar. 9

8 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL The Shop Smart Credit will continue to apply per the roll back period indicated within the Miscellaneous Rating Factor page (RS-2). A credit of the premium applicable for Coverage Parts 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 and 12 will be given to eligible policyholders. Refer to the Miscellaneous Rating Factors page for applicable discount, which is determined based on years at current residence, and, if such term is less than 7 years, date policy was submitted to Commerce. G. Good Student Discount The Good Student Discount applies provided the following criteria are met: a) The rated operator: 1. Is classified in one of the following inexperienced operator classes: 17, 18, 20, 21, 25 or 26; and 2. Is a full time high school, home study, college, or university student. b) The rated operator has met one of the following requirements: 1. Is in the upper 2 of his or her class scholastically; or 2. maintains a B average or higher, or its equivalent, or if the letter grading system cannot be averaged then no grade can be below a B ; or 3. in schools using numerical grade points, such as 4.0, 3.0, 2.0 and 1.0, had an average of at least 3.0 points or it s equivalent for all subjects combined; or 4. was included on the Dean s List, Honor Roll or comparable list indicating scholastic achievement. 5. In the case of home schooling, 2 options are given: I. a standardized form certified by a 3 rd party organization showing evidence that one of the qualifications listed above is satisfied; or II. evidence of scoring in the upper 2 on an annual national standardized exam. The discount will be applied to Coverage Parts 1, 2, 4, 5, 7, 8, and 9. Refer to the Miscellaneous Rating Factors page for applicable discount. The Good Student Discount cannot be applied in conjunction with the Student Away from Home discount. If the insured is eligible for both discounts, the Student Away from Home discount will apply. H. Student Away from Home Discount The Student Away from Home Discount applies provided the following criteria are met: a) The rated operator is classified in one of the following inexperienced operator classes: 17, 18, 20, 21, 25 or 26. b) The rated operator is a student residing at an educational institution over 100 road miles from the automobile s principal place of garaging. c) The student does not have regular access to the covered vehicle while at school. The discount will be applied to Coverage Parts 1, 2, 4, 5, 7, 8, and 9. Refer to the Miscellaneous Rating Factors page for applicable discount. The Student Away from Home discount can not be applied in conjunction with the Good Student discount. If the rated operator is eligible for both discounts, the Student Away from Home Discount will apply. I. Paid-in-Full Discount The Paid-in-Full Discount applies to policies where the annual policy premium is paid in full, subject to the following: For new business, payment must be made in full upon down payment. For renewal business, payment must be made in full upon the first installment due date. Exceptions: (1) National Standard and Named Non-owned policies are not eligible for the discount, and; (2) Finance company payments do not qualify for the discount. The discount will be applied to Coverage Parts 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 and 12. Note, this discount factor is added to the Green (Pay Plan) Discount factor. Refer to the Miscellaneous Rating Factors page for applicable discount. 18

9 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL J. Smart Driver Discount A Smart Driver Discount will apply if an eligible rated operator has completed a company approved Advanced Driver Training Program or the teensmart Training Program. The following eligibility rules apply: 1) Vehicle must be a private passenger vehicle as defined in Rule 27. Vehicles classified as antiques, motorcycles, motor homes/campers and miscellaneous motor vehicle types are not eligible. 2) All operator classes are eligible for the discount when the Advanced Driver Training Program is completed. 3) Operator classes 17, 18, 20, 21, 25 & 26 only are eligible for the discount when the teensmart Training Program is completed. 4) Discount will apply for the 5 year period from when the course is completed. For teensmart only, the discount will apply for the 5 year period from when the course is completed or until the operator reaches class 10, whichever is earlier. The maximum allowable discount at any given time is, regardless of the number of training programs completed by an individual driver. The discount will be applied to Coverage Parts 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 and 12. Refer to the Miscellaneous Rating Factors page for specific courses and their applicable discounts. K. Green (Pay Plan) Discount One of the following disounts will apply provided the following criteria are met: A. EFT/EBill only The EFT/EBill Discount will apply provided the following criterion is met: The insured is enrolled in either CIC s Electronic Fund Transfer program (EFT) or Electronic Invoice (EBill) program. B. Paperless (policy forms only) The Paperless Discount will apply provided the following criterion is met: The insured must sign up to view and receive their policy forms electronically on CWEB. C. EFT/EBill and Paperless The EFT/EBill and Paperless Discount will apply provided the following criteria are met: The insured is enrolled in either CIC s Electronic Fund Transfer program (EFT) or Electronic Invoice (EBill) program; and The insured must sign up to view and receive their policy forms electronically on CWEB. Exception: -National Standard and Named Non-owned policies are not eligible for the discount, The discount will be applied to Coverage Parts 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 and 12. Note, this discount factor is added to the Paid-In-Full Discount factor. Refer to the Miscellaneous Rating Factors page for applicable discount. L. Clean in Three Discount The Clean in Three Discount will apply provided the following criteria are met: a.) The rated vehicle is subject to the Merit Rating Plan; b.) There are no at-fault accidents or traffic violations attributable to the rated operator during the three years immediately preceding the policy effective date; c.) The rated operator has been licensed for at least three years; and d.) An electronic copy of the rated operator s driving experience is made available to Commerce when the rated operator has prior driving experience outside of MA during the Merit Rating Experience Period. Exceptions: -The rated operator s Merit Rating points are 00, 98, or 99; -The rated operator s Merit Rating points are greater than or equal to 5; -The rated operator has one or more days lapse in coverage within the last 12 months. The discount will be applied to Coverage Parts 1, 2, 4, and 7. Refer to the Miscellaneous Rating Factors page for applicable discount. M. Welcome Back Credit The Welcome Back Credit will apply to new business policies, effective and subsequent, provided the following criteria are met: 19

10 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL b. Sidecars; c. Custom paint, custom plating, custom seats and custom exhaust; d.. Safety riding apparel. This includes safety apparel specifically designed to minimize injury from an accident. This includes but is not limited to helmets, leather clothing, riding boots and gloves, and protective eyewear. Certain exclusions will apply. Please refer to the endorsement for additional details. This endorsement may be purchased for any motorcycle that has Part 9 - Comprehensive Coverage in increments of $1,000, up to a maximum limit of $25,000. Please refer to the Miscellaneous Rate Page for the applicable premiums per $1,000 of coverage. DriveAdvisor Program Endorsement CIC 2229 DriveAdvisor is a voluntary program available to eligible operators to promote safe, accident-free driving. As a DriveAdvisor participant, the insured will be provided with a device to install in their auto. The device collects data, which is analyzed for the purpose of providing online feedback and information about the insureds driving patterns. Participation in DriveAdvisor is subject to the program s terms and conditions. DriveAdvisor Endorsement is eligible to Insureds who: 1. have a 1996 or newer automobile that is compatible with the DriveAdvisor device; and 2. provide a valid address. This program allows for a discount and has no impact on coverage selections. If the participant withdraws from the DriveAdvisor Program at any time, the discount will be removed as per the relevant date. If the participant becomes disqualified from participating the program for failing to comply with the program s terms of use, the discount will be removed as per the relevant date. This service is provided through a third party and is subject to availability, terms, conditions and limitations, which may change without prior written notice. Retail Benefit Program CIC 2238 Retail Benefit Program is a voluntary program available to all policyholders. Policyholders that choose to participate in the program may be eligible to receive benefits that include, from time to time based on availability, discounts on products and services provided by third party retail stores, extended warranty benefits, and/or other rewards. This program has no impact on the premium or coverage selections. The benefits that are offered under the retail benefit program are subject to change at any time in our sole discretion. This service is provided through a third party and is subject to availability, terms, conditions and limitations, which may change without prior written notice. RULE 38. Disappearing Deductible Credit The Disappearing Deductible Credit is available to all eligible policyholders as of May 1, Endorsement CIC 2197 will be attached to all eligible new and renewal policies. For renewal policies issued on and after May 1, 2013, prior year(s) of coverage with Commerce count for the purposes of determining deductible credit awards. Eligibility The coverage applies if a premium is shown for any auto in the Coverage Selections Page for Collision or Limited Collision. Credit Awards Credits will be awarded after one full clean year where no credits were used or lost. Clean Year means any twelve month policy period in which the insured has their auto insured by Commerce and: (1) no operator was surcharged for an at-fault accident, and (2) the policy was free of hit and run Collision or Comprehensive loss payments greater than $500 for losses prior to July 1, 2015, or $1,000, for losses on or after July 1, Copyright, The Commerce Insurance Company, 2015

11 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL The Insured s policy will earn a $50 credit for the first four consecutive clean year(s) after the initial clean year up to the policy period. In the fifth consecutive clean year, the Insured s policy will earn a $100 credit. The maximum credits that can be earned is $300. If the credits are used or lost, a new clean policy year must be completed before the insured is awarded credits again. Using Credits Credits will be used to reduce the deductible amount that is owed on a Collision, Limited Collision or Comprehensive claim greater than $500 to which the deductible applies as long as the insured is not eligible for coverage under the Elite Package Endorsement. If the deductible is waived in whole or part by the Elite Package endorsement, that coverage prevails. Credits will be set to $0 if they are used during the policy period. Losing Credits Credits will be lost and will be set to $0 during the policy period if: At any time the insured does not have Collision Limited Collision coverage on at least one auto covered by the policy; The insured or any operator listed on the policy is surcharged for an at-fault accident when there is no Collision or Limited Collision claim made; The deductible is waived in whole or part by coverage in the Elite Package Endorsement; The policy cancels with a lapse in coverage. Note: If the policyholder is eligible for the Welcome Back Credit, their prior Disappearing Deductible credits will not be honored. Credits will be earned as noted above. 699 Copyright, The Commerce Insurance Company, 2015

12 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL RULE 40. ANTIQUE MOTOR CARS Any motor vehicle or motorcycle registered as an antique or, if not registered, is over twenty-five years old which is maintained solely for use in exhibitions, club activities, parades and other functions of public interest and which is not used primarily for the transportation of passengers or goods over any way, provided that the application for registration thereof is accompanied by an affidavit upon a form provided by the Registrar which will include a statement of the age and intended use of such motor vehicle. Refer to Rule 41 for Stated Amount Coverage. The merit rating plan does not apply to vehicles described in this Rule. Endorsement M-0047-S titled Antique Auto must be issued with the policy. Refer to the Miscellaneous Motor Vehicles page for rating methods and factors. An Antique Motor Vehicle is rated as follows: 1. For Coverage Parts 1, 2 4 and 5, charge a percentage of the otherwise applicable Class 10 private passenger premium, in accordance with Rule 11, Calculation. 2. For coverage Parts 3, 6 and 12 charge the applicable private passenger premium, in accordance with Rule 11 Calculation. 3. For Coverage Parts 7, 8, and 9, determine the symbol based on the appraised value. Then charge a percentage of the otherwise applicable Class 10 private passenger premium in accordance with Rule 11 Calculation, for the latest model year. Antique Motor Vehicles are not eligible to receive Coverage Part 10, Substitute Transpiration and Part 11 Towing and Labor. An Antique Motorcycle is rated as follows: 1. For Coverage Parts 1, 2 4 and 5, charge a percentage of the otherwise applicable motorcycle base premium in accordance with the motorcycle premium calculation rule. 2. For coverage Parts 3, 6 and 12 charge the applicable motorcycle premium in accordance with the motorcycle premium calculation rule. 3. For Coverage Parts 7, 8, and 9, determine the appraised value. Then charge a percentage of the Territory 1 base premium in accordance with the motorcycle premium calculation rule. Antique Motorcycles are not eligible to receive Coverage Part 11 Towing and Labor. This calculation and the applicable rating percentages are further defined in the Miscellaneous Motor Vehicle Rate Page. RULE 41. STATED AMOUNT COVERAGE Part 7 - Collision, Part 8 Limited Collision and Part 9 - Comprehensive A motor vehicle will be insured on a stated amount basis when it can be clearly established that its value will produce an inadequate premium charge using normal rating procedures. In such case, the vehicle will be rated as follows: 1. An appraisal will be made at the time of application to establish the current market value of the vehicle. The cost of the appraisal will be borne by the policyholder. The company will verify the accuracy of the appraisal. 2. Using the appraised value and the vehicle s model year, refer to Rule 22 to determine the symbol group. Obtain the stated amount rate from the Stated Amount Rate Calculation stated below. Apply the rate obtained to each $100 of the appraised valuation. 3. Determine final premium in accordance to Rule 11 Calculation We will provide physical damage coverage on a Stated Amount basis only once an appraisal is received and accepted by the Company. Policies with stated amount require an appraisal at new business and once every 3 years on renewal. Endorsement MPY-0027-S titled Stated Amount Coverage must be issued with the policy. This rating procedure is not available for antique automobiles which qualify under the Antique Motor Car Rule. 701 Copyright, The Commerce Insurance Company, 2015

13 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL Stated Amount Rate Calculation A. Collision and Limited Collision Rating Procedures 1. Determine the Actual Cash Value premium for model year 2017 shown in the rate pages for the vehicle symbol developed from Rule 22 for the appropriate territory code, class and deductible. Divide the Actual Cash Value premium by the Stated Amount Divisor table. Round the result to the nearest cent. For Symbol 71 and above, use the Symbol 70 Actual Cash Value premium and divisor. 2. Apply the above rate to each $100 of insured value to determine the stated amount premium. B. Comprehensive Stated Amount 1. Determine the Private Passenger latest year Class 10 manual rates by territory code for comprehensive. 2. Determine the comprehensive model year symbol factor based on model year 2017 for the symbol developed from Rule Median Symbol value. Calculated as the lowest value for the price new range + (highest value for the price new range minus the lowest value for the price new range)/2.00. The comprehensive stated amount rate per $100 is calculated as {[Step 1 * Step 2 *100.00] / Step 3} rounded to the nearest cents. C. Fire Stated Amount 1. Apply a factor of to the Private Passenger comprehensive model year symbol factor based on model year 2017 for the symbol developed from Rule Median symbol value. Calculated as the lowest value for the price new range + (highest value for the price new range minus the lowest value for the price new range)/2.00. The fire stated amount rate per $100 is calculated as {[Step 1* ] / Step 2} rounded to the nearest cents. D. Theft Stated Amount 1. Comprehensive Stated Amount as calculated above 2. Fire Stated Amount rates as calculated above The theft stated amount rate per $100 is calculated as { [0.70 * Step 1] Step 2 } rounded to the nearest cents E. Stated Amount C.A.C. with M.M.& V. 1. $500 Deductible 1 of the Stated Amount Comprehensive Rate 2. Additional Charges to Reduce Deductible from $500 - Same as Actual Cash Value Charges 3. For Higher Deductibles, Refer to Rule 16 RULE 42. FIRE, THEFT AND COMBINED ADDITIONAL COVERAGE A. Actual Cash Value Refer to Miscellaneous Rating Factors section for the applicable factors. B. Stated Amount Refer to the Rate Section for any specified peril Rule 43 RESERVED FOR FUTURE USE 702 Copyright, The Commerce Insurance Company, 2015

14 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL Standards for Suspension of Physical Damage Coverage for Failure to Inspect If an inspection is not conducted prior to the expiration of the deferral period specified in 211 CMR (1), Physical Damage Coverage on the Private Passenger Motor Vehicle is automatically suspended at 12:01 a.m. on the day following the tenth calendar day allowed by 211 CMR 94.07(1), and will continue until the inspection is effected. Commerce will reinstate Physical Damage Coverage effective at the time of inspection, in accordance to the Regulation, if the Applicant thereafter requests an inspection. Standards and Procedures for Inspection (1) Pre-insurance Inspections required or permitted pursuant 211 CMR will be conducted by an Authorized Representative of Commerce at a time and place reasonably convenient to the Applicant. A reasonable convenient time shall include, in addition to customary business hours, sufficient early morning, evening and weekend hours. A reasonably convenient place shall not be more than five miles from the city or town where the Private Passenger Motor Vehicle is principally garaged. (2) (a) Any forms issued by Commerce to the Applicant, for presentation to the Authorized Representative will not contain the Vehicle Identification Number (VIN) of the motor vehicle to be inspected. (b) The Inspection will: 1. be recorded in the Motor Vehicle Pre-Insurance Inspection Report; 2. include two color photographs of the Private Passenger Motor Vehicle; 3. include a close-up color photograph showing the Vehicle Identification Number (VIN) located on the Environmental Protection Agency/Federal Certification Label (EPA) sticker affixed to the driver s side door jamb. The photograph will be of sufficient clarity that the information contained on the EPA sticker and the VIN is legible. If the EPA sticker is damaged, faded, missing or otherwise not legible, a photograph of the EPA sticker or of the area of the door jamb where the sticker normally is located still is required. (c) The Authorized Representative will take additional photographs showing any damaged areas of the Private Passenger Motor Vehicle. (d) The inspection information and photographs must be sent immediately to Commerce which will be retained for three years as provided by the Regulation. (3) Commerce will maintain an up-to-date list of all its authorized representatives and inspection sites. (4) There will be no additional or separate charge to the Applicant in connection with an inspection of a Private Passenger Motor Vehicle. RULE 56. MERIT RATING PLAN The following is an overview of the terms of the Merit Rating Plan and its impact on underlying rates. Experience Period Each listed operator on a policy is assigned a merit rating based on the operator s driving record. The merit rating adjustment is a percentage multiplied by the otherwise applicable premium that reflects the number, type, and age of at fault accidents and traffic violations of the operator during the policy experience period. The percentage can be either positive or negative. The policy experience period is the six years immediately preceding the effective date of the policy. The merit rating adjustment will be determined based on the merit rating code reported to us by the Merit Rating Board. Operators New to Massachusetts If an application for insurance indicates that an operator new to Massachusetts was licensed outside of Massachusetts within the last six years or such operator is being added to an existing policy, the operator s policy experience period 715

15 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL will begin as of the effective date of that policy until Commerce receives an authorized inquiry response from the Merit Rating Board indicating the operator s merit rating code. If an operator s Motor Vehicle Report (MVR) is electronically available, Commerce will be responsible for obtaining it from the state or country where the operator was licensed. Driving history on MVRs obtained from more than one state or country will be combined by Commerce and considered as one report. An acceptable MVR must have three years or more driving history, unless the operator has been licensed less than three years. If there are no motor vehicle violations or at-fault accidents shown on the MVR, Commerce will submit a policy inquiry to the Merit Rating Board in compliance with the MRB manual and its Administrative Procedures. An operator s MVR with motor vehicle violations or at-fault accidents will be submitted to the Merit Rating Board. The Merit Rating Board will determine the operator s merit rating code. If an operator s MVR is not electronically available, the operator s policy experience period will begin as of the effective date of the policy until Commerce receives an authorized inquiry response from the Merit Rating Board with the operator s actual merit rating code. The operator may obtain an official driving record or a record from a previous insurer and submit it to Commerce. If the driving record is not in English, a translation certified as true and correct by the translator must be obtained by the operator and attached to the driving record submitted to Commerce. An acceptable driving record must have three or more years driving history, unless the operator has been licensed less than three years. If there are no motor vehicle violations or at-fault accidents shown on the operator s record, Commerce will submit a policy inquiry to the Merit Rating Board in compliance with its Administrative Procedures. An operator s record with motor vehicle violations or at-fault accidents must be submitted to the Merit Rating Board. The Merit Rating Board will determine the operator s merit rating code. Determination of Merit Rating Code Points are assigned to an operator for each of the following at-fault accidents and traffic violations that occurred during the five years immediately preceding the effective date of the policy: Minor traffic law violation 2 points Major at-fault accident 4 points Minor at-fault accident 3 points Major traffic law violation 5 points An at-fault accident is one in which the company determines that the involved operator is more than 5 at fault. An at-fault accident is defined as minor or major if it resulted in a claim payment for bodily injury liability, damage to someone else s property, collision or limited collision based on the table below: If the accident occurred prior to July 1, 2015 Minor Accident Major Accident Total claim payment of at least $500 and up to $2,000. Total claim payment of more than $2,000. If the accident occurred on or after July 1, 2015 Minor Accident Total claim payment of more than $1,000 and up to $5,000. Major Accident Total claim payment of more than $5,000. If the most recent at fault accident or traffic violation occurred less than three years prior to the policy effective date, the operator s merit rating code will equal the sum of the points accumulated for at-fault accidents and traffic violations that occurred during the five years immediately preceding the effective date of the policy. If the most recent at fault accident or traffic violation occurred more than three years prior to the policy effective date, and the number of at fault accidents or traffic violations in the past five years is three or less, the points assigned to each incident shall be reduced by one, and the total number of points assigned to the operator shall be the sum of those reduced points. In no event shall the points for any at fault accident or traffic violation be reduced below zero. Points are not assigned to a non-criminal minor motor vehicle traffic law violation if it is the first such violation or if it occurs in the sixth (oldest) year in the six year policy experience period. If there are no at-fault accidents or traffic violations attributable to an operator during the six years immediately preceding the policy effective date, the operator s merit rating code is 99. If there are no at-fault accidents or traffic violations attributable to an operator during the five years immediately preceding the policy effective date, the operator s merit rating code is 98. In addition, a merit rating code of 98 will be assigned to an operator with at least 5 years of experience, with an incident free period equal to or greater than three, with 1 minor non criminal traffic violation that occurred in the 4 th, 5 th or 6 th year of the experience period. 716

16 MASSACHUSETTS PRIVATE PASSENGER AUTOMOBILE INSURANCE MANUAL TITLE PRIVATE PASSENGER ENDORSEMENTS ALPHABETICAL INDEX FORM NO. AAA Member Package Endorsement CIC 2114 (Ed. (Ed ) Accident Forgiveness CIC-2209 (Ed ) Advisory Notice to Policyholder Vehicle Sharing and Public or Livery Conveyance PA800MA (Ed 05/16) Agreed Amount Comprehensive MPY-0034-S Ed ) Antique Auto M-0047-S (Ed Rev.) Auto Loan/Lease Coverage CIC 2125 (Ed. 5-12) Commerce VIP Package Endorsement CIC 2123 (Ed ) Commerce Elite Package Endorsement CIC 2126 (Ed ) Coverage for Anyone Renting An Auto To You M-0070-S (Ed ) Coverage for Customized Vans and Pickups MPY-0037-S (Ed ) Disappearing Deductible Credit Endorsement CIC-2197 (Ed. 05/16) DriveAdvisor Program Endorsement CIC-2229 (Ed. 12/15) Retail Benefit Program Endorsement CIC-2238 (Ed. 5/14) Enhancer Package Endorsement CIC 2122 (Ed ) Excess Electronic Equipment Coverage MPY-0041-S (Ed Rev.) $100 Glass Deductible MPY-0039-S (Ed ) Guest Occupants Exclusion - Motorcycles M-0002-S (Ed ) Massachusetts Automobile Insurance Policy 2008 Edition Massachusetts Mandatory Endorsement M-0099-S (Ed ) Mobile Home Endorsement MPY-0002-S (Ed ) Motorcycle Accessory Coverage CIC-2174 (4/11) Non-Renewal of Policy Motorcycles, Recreational Vehicles and Trailers M-0103-S (Ed ) Notice to Policyholders CIC-2211 (11/13) Notice to Policyholders CIC-2210 (11/13) Operator Exclusion Form CIC-616 (Ed ) Original Equipment Manufacturer Parts Coverage MPY-0040-S (Ed ) Other Optional Insurance Combined Additional Coverage MPY-0031-S (Ed ) Other Optional Insurance Fire, Lightning and Transportation MPY-0028-S (Ed ) Other Optional Insurance Theft MPY-0029-S (Ed ) Stated Amount Coverage MPY-0027-S (Ed Rev.) Suspension of Coverage - Reduction of Limits MPY-0032-S (Ed ) Transportation of Fellow Employees, Students or Others M-0004-S (Ed ) Trust Endorsement M-0107-S (Ed ) Use of Other Autos - Vehicles Furnished or Available for Regular Use M-0051-S (Ed ) Vehicle Sharing and Public or Livery Conveyance Exclusion CIC-2212 (Ed. 05/16) Waiver of Deductible MPY-0016-S (Ed Rev.) B-1

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