The Safe Driver Insurance Plan (SDIP) is a program mandated by state law that encourages safe driving by rewarding drivers who do not cause an accident, or incur a traffic law violation and by making sure that high-risk drivers pay a greater share of insurance costs. The SDIP premium adjustment is the last step in the rating process after all discounts and rating factors have been applied.

The following information is a general overview of the Safe Driver Insurance Plan and its impact on your insurance premium.

As of January 1, 1999, if an application for insurance indicates that an operator new to Massachusetts was licensed outside of Massachusetts within the last six years or an operator is being added to an existing policy, the operator will be initially placed at SDIP step 15. If an operator’s Motor Vehicle Report (MVR) is electronically available, the insurer will be responsible for obtaining it from the state or country where the operator was licensed. If an MVR is not electronically available, the operator may obtain an official driving record or a record from a previous insurer and submit it to the current insurer. The Merit Rating Board will determine the operator’s SDIP step.

Under the SDIP, you incur surcharge points for traffic violations and at-fault accidents. You earn a credit point for each incident-free year (any of the one-year periods immediately preceding the policy effective date for which you have had no violations or at-fault accidents). You do not incur surcharge points for your first minor traffic violation during the policy Experience Period (which is the six year period immediately preceding the policy effective date), but you do not earn a credit point for that year.

Your SDIP step is calculated using a starting Step of 15, and your driving record during the policy Experience Period. Beginning at the neutral Step 15, add Surcharge Points for any Surchargeable Incident and subtract a Credit Point for each incident-free year of driving. The result is your SDIP Step. Each accident or violation remains on your record for six years from the surcharge date. No points are applied to incidents in the sixth year of the policy Experience Period.

Driving safely and avoiding surchargeable incidents can save you up to 42% on certain coverages. One credit point is subtracted for each year in which you do not cause an accident or incur a traffic violation. You get a credit point for any incident-free year of driving completed during your policy Experience Period as an out-of-state driver. The Clean Slate Rule can help you if you resolve to drive better. If you have a bad driving history with many surchargeable incidents and are paying a high surcharge premium, you can earn credit points by maintaining three consecutive years of incident-free driving. If you do not cause any accidents or incur traffic violations for the three consecutive years preceding the policy effective date and your SDIP step is 15 or higher, your SDIP Step will be set at 14, a credit step.

You incur surcharge points if you:

1) cause an at-fault accident, or
2) are convicted of, or pay a fine for a traffic law violation, or are assigned to an alcohol education program.

At-Fault Accidents: You incur surcharge points if you are more than 50% at fault for an accident. You incur three surcharge points for Minor At-Fault Accidents and four surcharge points for Major At-Fault Accidents. A claim payment of over $500 up to and including $2,000 for Collision or Damage to Someone Else’s Property is considered a Minor At-Fault Accident. If the claim payment is over $2,000, it is a Major At-Fault Accident.

NOTE that for accidents that occurred before January 1, 1995, a Minor At-Fault Accident was between $200 and $1,500 and a Major At-Fault Accident was over $1,500.

Traffic Violations: If you are convicted of, and/or pay a fine for violating certain motor vehicle traffic laws in Massachusetts or out-of-state, or you are required to participate in an alcohol education program, the court will notify the Merit Rating Board.

The violation and surcharge points will be added to your driving record. Minor traffic violations include infractions such as; speeding, operating a vehicle without a valid inspection sticker and failure to obey traffic lights. Some examples of major traffic violations include operating under the influence of liquor or narcotics, leaving the scene of an accident and refusing to stop for a police officer. If you disagree with a traffic violation, you must appeal it through the court system, as indicated on the back of the citation violation. Traffic violations CANNOT be appealed to the Division of Insurance Board of Appeal or the Merit Rating Board.

More Than One Car Or Driver On A Single Policy

The listed driver with the highest SDIP Step is assigned to the vehicle with the highest combined premium for Bodily Injury, Personal Injury Protection, Damage to Someone Else’s Property and Collision coverages. For each subsequent vehicle, the listed driver with the next highest Step is assigned to the vehicle with the next highest combined premium until no vehicles remain. When there are more vehicles than drivers on a policy, the excess vehicles are assigned the Step of the driver with the lowest Step.

If a driver’s Step is greater than 15, it will not be billed on more than one policy in effect at the same time. The SDIP Step of any operator who has a Massachusetts private passenger auto policy of their own, or whose SDIP Step is billed to another Massachusetts policy will not be billed to any other vehicle on any other policy.

Application Of At-Fault Accident Surcharges To Your Record

Insurers are required to determine if an operator is at-fault in excess of 50% by applying the Standards of Fault (211 C.M.R. 74.00), a regulation promulgated by the Division of Insurance. The Standards of Fault are common accident types under which you are presumed to be more than 50% at-fault. For example, the Standard of Fault, "Rear End Collision" presumes that you are more than 50% at-fault for an accident when operating a vehicle which is in collision with the rear section of another vehicle. This presumption will determine the outcome of the appeal hearing, unless you overcome the presumption by providing sufficient evidence that you were not more than 50% at-fault.

If your company determines that you are at-fault, they will send you a Surcharge Notice, as required by law. It includes instructions for appealing the surcharge to the Division of Insurance Board of Appeal. The surcharge remains on your record unless you successfully appeal.

If you receive a Surcharge Notice which names the wrong operator, call your insurance company; they should rescind the incorrect notice and reissue a notice to the correct operator.

Appealing An At-Fault Accident Surcharge

If you disagree with the surcharge and believe that you were not more than 50% at-fault, you may appeal the surcharge to the Board of Appeal located at the Division of Insurance. The filing fee is $25. The law requires you to appeal within 30 days from receipt of the Surcharge Notice; otherwise you will lose your right to appeal.

Once you have submitted your appeal, you will receive a Surcharge Appeal Receipt. Three weeks prior to your hearing, you will receive a Hearing Notice indicating the date, time and location of your hearing. If surcharge points are applied to your premium while your appeal is pending, you must pay the additional premium or your policy will be cancelled. If the decision is in your favor, you will receive a refund or credit from your insurance company for any increased premium you have paid due to the surcharge. When you appeal a surcharge, a hearing officer must decide whether you were more than 50% at- fault for the accident according to the Standards of Fault, or if there were extenuating circumstances which contributed to the accident.

If the Board of Appeal finds that you are 50% or less at-fault, the incident will be removed from your driving record which is maintained by the Merit Rating Board. Your insurance company will adjust your premium accordingly.

The appeal does not guarantee success. If you do not agree with the decision of the Board of Appeal, you may pursue the matter further in Superior Court.

If you have questions concerning the SDIP, please contact the Merit Rating Board’s Customer Service Section at (617) 351-4400.