Francis Mancini
Age: 58
Organization: Massachusetts Association of Insurance Agents
Experience: 29 Years in the MAIA
The past year has unearthed plenty of dissent against new insurance commissioner Nonnie Burnes; much of that has come from the Massachusetts Association of Insurance Agents, which is suing the commissioner over what it claims is unfair favoritism toward new Massachusetts entrant Progressive Auto Insurance. Its executive director, Francis Mancini, now presides over a new age of insurance in Massachusetts, where agents are grappling with big changes to the system and a consolidation of their numbers. Mancini came to the Banker & Tradesman offices to talk about his long career hobnobbing amongst lawmakers and regulators, and what agents face in the years to come.
You’ve talked before about how Massachusetts has a larger-than-average number of agencies, but that changes in the market will probably shutter a lot of those companies. Has that happened this year?
I wouldn’t characterize it as “going out of business” – what we’ve seen is a consolidation of our members. We have seen that accelerate over the last year or so, and what we see is that [among] our smaller members … we’re finding them consolidating with other small agencies to become mid-sized agencies, or consolidating with larger agencies. And back in 2000 or 2001 we did an economic impact study, and at the time we found that our average member had about five employees. We just redid that study last summer and we found that the average number of employees is now seven. So the number of agencies is decreasing, but the number of employees within those agencies is increasing. Those remaining agencies are doing more business, and they need more employees to handle it.
Can you tell how many have consolidated?
I can tell you what our membership numbers have been over the last couple of years. Our membership in 2007 was about 1,600 agencies, and during 2008 that dropped to about 1,560 or so. And we’re anticipating a drop to close to 1,500, 1,510. We track this … and we’ve found that few if any agencies have actually gone out of business – they have consolidated their business with another agency.
It does seem like you’ve butted heads with the commissioner a fair amount this past year. Has the new regime been a tenser one for you than in pervious years?
We take positions on issues that we feel are a benefit to our members and the consumers that our members represent, and sometimes those are in line with what a commissioner thinks, and sometimes they’re not.
For example, we just wrote to the commissioner a month or so ago, concerning inaccurate quotations on the Web site of [Progressive], and this is the second time within a sixth-month period that this company has admitted that they’ve given inaccurate quotes on their Web sites [for their competitors] – they’ve given higher quotes than their competitors’ prices actually were. And we don’t think that’s consumer friendly.
We think the Division of Insurance’s oversight has been lax. And [Progressive] admitted to providing inaccurate quotes back in August, and they said they wouldn’t operate their comparisons again until they were sure they were correct, and three months later, they’re incorrect again.
As far as your role in the organization, what did you do before taking over your current job?
I was the primary lobbyist for the association, and that was [for 14 years].
How’d you get into the insurance lobbying game?
I worked for what was then called the Joint Committee on Insurance in the Legislature, and I was an administrative assistant back in the ’70s. Sort of the gopher.
And you became enchanted with the whole insurance industry?
Insurance agents, they’re just great people. And most of our members are small businesspeople. The economic impact study that we just completed found that 9 percent of our members’ agencies are over 100 years old, and that another 31 percent of our members, their agencies are over 50 years old. … They’re second and third generations. Myself, personally, I can cite a couple of cases where when I started working with the association, I was working with an individual and now I’m working with that individual’s grandchildren. And most of these agents are very involved in their communities: they volunteer, they contribute. The average agency in Massachusetts in 2007 contributed over $5,000 to charitable organizations.
Top Five Regulatory/Legal Battles For The MAIA:
1 Ongoing lawsuit against Insurance Commissioner Nonnie Burnes. MAIA and Arbella Insurance claim that Burnes is giving unfair advantages to new entrants into the state’s auto market. The key point of contention: That new entrants can wait two years before they must participate in a state-run pool for the riskiest, costliest drivers.
2 Revive the independent appeals board for claimants who believe they’ve been wrongly denied insurance coverage or found at fault in an accident. Burnes ruled recently that the state would do away with the appeals board, and only allow claimants to appeal the insurers’ decisions to the insurers themselves.
3 Prohibit the use of credit scoring to determine consumers’ insurance rates. The practice is already prohibited in the state for use with auto insurance, but the group wants that prohibition expanded to homeowner’s insurance, too.
4 Support for strengthening the credit system for the Massachusetts FAIR plan, which gives companies credit for writing more policies along the state’s coast. That extra credit means such companies don’t have to take on quite as much of the FAIR plan’s annual deficit as other companies that shy away from coastal areas.
5 Weighing in on the state’s new data security regulations. The group testified to get the regulation implementation deadline pushed back. Now the new regulations, which are meant to protect employee information, will be pushed back from the original date of Jan. 1 to the end of September.
