State hits Progressive with $125,000 fine

State hits Progressive with $125,000 fine

Website link provided information on use of credit scores

The Massachusetts Division of Insurance today slapped a $125,000 fine on Progressive Insurance for inadvertently posting a link on its website about the use of credit scores in setting auto insurance rates.

The insurance giant apologized for the confusion and said it does not use credit scores in setting auto insurance rates in Massachusetts. It also said all the rates it provided to Massachusetts customers on its website were accurate and legal.

“However, we may have inadvertently led some people to believe that we use credit for rating and underwriting because the link appeared on the site,” the company said in a statement. “This link is standard in other states where credit is a part of the rating and underwriting process.”

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Bruce Mohl

Editor, CommonWealth

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

The incident shows how controversial credit scores have become in Massachusetts. In most states, automobile insurers use a person’s credit score to predict their likelihood of becoming involved in an accident. But the practice was banned as discriminatory in Massachusetts, initially by regulation and more recently with the passage of a new law that prohibits the use of credit scores in setting rates.

The state Division of Insurance said 3,200 Massachusetts consumers visited the Progressive website and received the credit inquiry information. The division is requiring Progressive to contact each of the customers and explain the mixup and also provide them with a free copy of their credit report.