N.J. Agents To Regulator: Simplify New Rules

As part of the state's auto insurance reform package passed in 2002, the legislation requires agents to give customers three scenarios illustrating the effect of different coverage choices on them.

Agent groups said that while they support the measure's desire to educate consumers, they feel the regulations set out by the New Jersey Department of Banking & Insurance to implement the legislation could lead to confusion for consumers and unnecessary work for agents.

"We do this (explaining policy implications) for every customer, every day," said John D'Agostino Jr., vice president of D'Agostino Agency in Hammonton, N.J., and president of the Professional Insurance Agents of New Jersey.

He said there needs to be some recognition in the regulations "that the agent is looking out for the best interest of their client."

"We support the idea of education," said Jeanne Heisler, president of the Ronan Agency in Bricktown, N.J., and government affairs representative for the Independent Insurance Agents of New Jersey. "We have other questions about the rules and believe there needs to be clarification about what it does."

The association representatives pointed to different aspects of the legislation that they felt need to be addressed to reduce confusion for consumers.

Mr. D'Agostino argued that under the current proposed regulations, agents would have to give a scenario with a price for each of the companies they represent. He said it would be better if the scenario gave percentages of savings so consumers don't confuse the dollar figure with a quote.

He also said that consumers could be given a cheap quote from a questionably solvent carrier. Agents' discretion should be used to place clients with the best companies for their risk.

Ms. Heisler felt customers needed information that is clear and concise, and that the proposed regulations would make the whole process too complex.

"We are just hoping that the regulations are crafted so that they make sense for consumers without making more work for agents," she said, "and that they become a valid tool in the selection process for consumers."

Mary Cozzolino, assistant commissioner for public affairs for the insurance department, said the regulations are only in the proposal stage and the department sought comment from a variety of sources during the public comment portion. The comment portion is now closed. The department is reviewing the comments and, based on those comments, is hopeful a final version of the comments will be adopted in early 2004.

After meeting with policyholders throughout the state, Commissioner Holly C. Bakke had the regulations drafted reflecting the concerns policyholders have, Ms. Cozzolino noted.