Few Mass. drivers appeal insurance surcharges
Even though they stand a better than 50/50 chance of winning, fewer Mas sachusetts drivers are appealing insurance surcharges for auto accidents or traffic violations, a study by the New England Center for Investigative Reporting has found.
Data from the state Insurance Board of Appeals, which rules on traffic accident cases alone, shows that the number of drivers appealing those accidents -- and the insurance surcharges that come with them -- has declined by 36 percent since 2006, even though just over half of those drivers were winning their appeals. Only about 30 percent of drivers who appealed were found to be more than 50 percent at fault and subject to a surcharge.
The Registry of Motor Vehicles is seeing a similar trend in the number of traffic ticket appeals.
"We are not in a position to speculate as to the reason for the decline in citation appeals," said Sara Lavoie, with the registry.
The state Insurance Division won’t speculate either, saying only that the division doesn’t track the reasons motorists appeal or don’t appeal surchargeable accidents.
Some insurance critics suspect the trend may be because the appeal fees are costly and drivers have little spare cash to file those appeals because of the lingering recession.
The fees, which start at $25 to fight a moving violation before a clerk magistrate and $50 to challenge an insurance surcharge before the Insurance Board of Appeals, can add up. Appealing either decision through the court system can add hundreds more to the tab.
More than a decade ago, the Executive Office of Admin istration and Finance authorized the fees for drivers who appeal an insurance surcharge. The money goes to run the Insurance Board of Appeals.
Fees to appeal traffic tickets were set by the Legislature in 2009. Those fees are collected by the courts, which use the money to offset their costs.
Originally imposed to curtail frivolous appeals from clogging up the court docket, the fees have done their job, said both registry officials and insurance industry critics. The fees have cleared thousands of traffic cases from court calendars and thousands more from the docket for the Insurance Board of Appeals.
In 2010, nearly 60,000 fewer drivers -- representing a 21 percent drop -- appealed traffic citations compared to the prior year, registry statistics show. In 2011, about 91,000 fewer drivers appealed traffic tickets than in 2009. The Insurance Board of Appeals saw its caseload drop by nearly 20,000 -- 36 percent -- since 2006.
Although no official study has been conducted, insurance industry critics like Ivan Sever, state coordinator for the National Motorist Association, a driver advocacy group, believes the reason for the sharp decline may be a result of fees imposed in the courts.
"People may find they can’t afford it financially," Sever said.
Add to that the cost of taking time off from work to appear before a clerk magistrate or appeals board, and most motorists may have second thoughts about challenging a ticket, he said.
Belmont attorney Ralph Sullivan had second thoughts too. But it had nothing to do with the cost of appealing the traffic citation he received for a lane change violation. Sullivan thought the fees were unconstitutional, so he challenged that ticket all the way to the state Supreme Judicial Court. By the time he was through, the $100 ticket cost him nearly $1,000 in filing fees.
"If I had to do that for a client, it would have been an $8,000 to $10,000 project," Sullivan said. His argument before the court: Motorists were being forced to pay fees not assessed in other types of civil or criminal cases, including drug or assault cases. The fees, said Sullivan, also impede due process because the cost prevents poorer drivers from challenging a traffic citation in court.
The SJC didn’t agree. Last year, the court ruled that the fees were payable even if a motorist was found innocent of the ticketed offense.
"If the person driving your car was your evil twin, you shouldn’t have to pay to tell the court that," Sullivan said. "Charging fees to people to be heard for moving violations or to be heard on merit rating surcharges is a deterrent to the judicial process."
State Rep. David B. Sullivan, D-Fall River, agrees. He’s sponsored two pieces of legislation that would ultimately prevent the courts from charging a $25 hearing fee to motorists found innocent of a driving offense. Both bills are under study before the Joint Committee on the Judiciary.
"If you are found not to be responsible, you shouldn’t have to lose money," said David Sullivan, who proposed the legislation in December 2010 after numerous complaints from drivers. "It’s an issue of fairness. It’s an issue of justice."
The court does allow motor ists to appeal without a fee provided they can show those fees are a hardship but Sullivan said it’s difficult for drivers to prove they can’t afford to pay the fees if they can afford a car, insurance and gas.
The American Civil Liberties Union, which in 2011 backed a lawsuit that unsuccessfully challenged a $275 fee imposed by the city of Northampton on parking ticket appeals, is currently pushing for legislation to allow those parking ticket cases to be filed in small claims court where filing fees are $40.
"People should not face excessive, hugely impractical barriers to getting fair access to the courts," said Christopher Ott, communications director for The ACLU of Massachusetts.
Sullivan and other critics think the fees are not only unfair, they create a conflict of interest because traffic and accident cases are often decided by the same people who benefit from the revenue those fees generate.
In 2010, fees for a hearing on a traffic ticket before a clerk-magistrate generated more than $3.7 million in revenues for the courts. Nearly $2 million more went into the state’s general fund from Insurance Appeals Board fees, which are designed to offset the cost of hearings.
All that revenue comes on top of the millions more that drivers shell out to pay the actual tickets, some of which include an additional $50 head injury surcharge tacked on for speeding. Drivers convicted of drunken driving and reckless driving violations pay $250 in head injury surcharges as well.
The winners in this whole process are not just the courts and the state, but also the insurance companies that collect millions in annual surcharges imposed against errant and sometimes innocent drivers over the six years following a ticketed offense, critics claim. During that span of time, an offense and a surcharge remain on a driver’s record.
Yet it’s not just appeal fees that have troubled some pundits. Ballooning insurance surcharges, inadequate record keeping and a lack of industry transparency has some critics worried that Massachusetts drivers and their pocketbooks are under siege.
Frank Mancini, president and CEO of the Massachusetts In surance Agents, said the system, which assigns a merit rating based on driving history, can be both complex and costly.
Drivers involved in an accident or moving violation are ranked not only against an insurance company’s "standard of fault," Mancini said, but also by a host of other things, including the neighborhood in which a car is garaged, the age and sex of the driver along with his years of driving experience.
But not all rating factors are public, which means few drivers actually know the exact mix that goes into determining a driver’s insurance rate.
That has become an issue with the Massachusetts Attor ney General’s Office. In April, that agency expressed concern over the insurance industry’s failure to fully disclose complete rating factors, including those for accidents and traffic tickets, which companies use to determine insurance surcharges and premiums.
"This information is necessary for a proper review of the rate to assure that consumers are treated fairly," Glenn Kaplan, chief of the Attorney General’s Insurance and Financial Services Division, said in a statement.
That lack of transparency means few motorists know up front how much their rates will rise if they lose an appeal.
The New England Center for Investigative Reporting (www.necir-bu.org) is a nonprofit investigative reporting newsroom based at Boston University.
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