Insurance agents say auto shift spells doom

Dan Devine | 3/18/2009, 6:20 a.m.

Burnes said that the Division of Insurance (DOI) wasn’t seeing the geographic discrepancies that Webster and the other agents alleged. She showed several graphs and charts that she said showed agents without contracts are spread across the state. She also said that urban ERPs are getting voluntary contracts, including about half of producers in Boston and 13 of the 31 in Dorchester and Roxbury.

Those without contracts, like Paul D. Wasgatt, must now operate with slashed business in a terrible economy.

“What you’re saying to us is, ‘Send your customers that you’ve developed over 23 years in the business to other companies,’” said Wasgatt, owner of Safeside Insurance Agency in Worcester.

Because ERPs “spent all these years writing the business that nobody wanted to touch,” Wasgatt added, they typically have higher loss ratios, which makes them less attractive to insurers — and reduces their chances of getting contracts.

Many agents said they had tried to get voluntary contracts, but were unsuccessful. Some said they’d been promised pacts, only to see carriers back out.

A representative for one carrier referenced by several agents, MetLife Auto and Home, said the company “has extended voluntary appointments to exclusive representative producers … across the state over the last several years.”