When Nonnie S. Burnes became insurance commissioner, she was a completely unknown entity in the insurance business. Just two years later, she’s leaving the post and in her wake is a vastly changed insurance landscape – as well as some strong opinions from state industry players.
“It doesn’t go too far to say that Commissioner Burnes was a transformational figure,” said Frank O’Brien, regional head of the Property Casualty Insurers Association of America.
She’s stepping down for a new job as a senior fellow at alma mater Northeastern University, a move that caught many in the industry off guard. In her stead, she’s leaving top deputy Joe Murphy as interim commissioner until a replacement can be appointed.
Asking Basic Questions
O’Brien and members of the local industry say Burnes, a former Superior Court Justice, brought a deliberative, decisive courtroom mentality to insurance regulation.
It was that cool assessment of Massachusetts insurance law that brought her to create undoubtedly the biggest shakeup of her term – auto insurance reform. O’Brien says Burnes approached the law by asking basic questions about its usefulness: If the logic was unsatisfactory to her, he said, she just set about changing the system.
Deregulation has been credited since with bringing 11 new insurers into the state and lowering costs for consumers. But the decision brought a fair amount of trepidation from the industry, and the details of the changeover sparked strong dissent.
Burnes is a defendant in a lawsuit that accuses her office of giving unfair advantages to new market entrants such as Progressive Insurance, at the expense of established insurers in the state.
One of the plaintiffs, the Massachusetts Association of Insurance Agents, has respectful words for Burnes. But Daniel Foley, the MAIA’s vice president of government affairs, says her departure does leave open the opportunity that her replacement will better respond to the group’s complaints.
“We certainly wish her the best at her new position,” Foley said. But added, “We hope there will be some changes.”
MAIA fought earlier this year against a controversial decision Burnes made to dismantle the state’s insurance policyholder appeal board. The board allows Massachusetts policyholders to defend themselves if they believe they’ve been found unfairly at-fault in an accident, and critics such as the MAIA won their fight to keep the board intact.
Coastal Controversy
In her two years, Burnes found herself at the heart of another contentious issue: coastal homeowners’ insurance, and the giant increase in homeowners forced to go to the FAIR plan, the state-run insurer of last resort.
Charles Robinson of Dennis-based Rogers & Grey Insurance Agency served with Burnes on a special commission on homeowners’ insurance in fall 2007, where the new commissioner set about learning the intricacies of insuring coastal property.
Robinson found Burnes willing to listen and quick to size up the situation. She would later reject a proposed rate increase from the state-run insurance plan, however, and that move would earn some grumblings from private insurers who wanted a level playing field, cost-wise, in the area.
However, not all Burnes’ decisions were quite so public or divisive.
Bob Sheridan, CEO of the Savings Bank Life Insurance Co. of Massachusetts, will remember her tenure for a less-flashy revolution: paperwork.
Burnes re-engineered a form filing process for insurance companies that expedited regulator approval and made turnaround times much shorter. A pedestrian-sounding thing, maybe, but it made doing business much easier.
“It’s not exotic or sexy,” he said. “But it was very, very necessary.”
Sheridan, for his part, echoed the belief that Burnes always gave people their ‘day in court,’ so to speak, even if they didn’t agree with her final decisions.
“I can tell you, most emphatically, [her resignation] is a big loss,” Sheridan said.
