State auto insurer chided for bonuses

But MAIF officials say move kept rates down in recession

By ELISHA SAUERS Staff Writer

Published 11/18/09

Top executives of Maryland's last-resort auto insurer said they lowered goals for their employees to receive bonuses last year to keep consumer premiums down.

The representatives of the agency, the Maryland Automobile Insurance Fund, said the decision, among many other revisions to the agency's financial goals, was in response to difficult economic conditions for the business and the customers they serve.

Despite the agency's loss of $19.6 million in 2008, state auditors have found that MAIF doled out $1.4 million in bonuses after its trustees downgraded program policies in the middle of the year. Had the...

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Wasteful - 2009-11-19 11:27:17

I can't even believe I am reading this...

They have a gap between revenue and expenses, so instead of cutting expenses or generating revenue, they decide they are good with losing money and give everyone a bonus. This is rediculous. Everyone at the top should be ashamed. And that includes the Maryland Legislature for not investigating this.

And I'm not even adressing the idea that they might have to raise premiums to cover their bonues. Higher premiums means people drop out of the program and drive uninsured. There shouldn't be ANY bonuses at a state run agency. They should keep expenses as low as possibe to keep premiums as low as possible to get more drivers into the program.

As a side thought, is this how state run health care is going to drive down costs and make private healthcare more competative? Appoint a bunch of cronies to run a program and give themselves bonuses when they can't figure out how to cover cost?

Sheeeesh

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Laz Johnston - churchton, md - Karma: Neutral