AIG To Enter Massachusetts' Car Insurance Market

July 14, 2008 7:51 a.m. EST

Boston, MA (AHN) - New York-based American International Group (AIG), the country's largest insurer, has announced it intends to establish its car insurance business in the Bay State.

AIG is among four insurance companies planning to tap into the state's insurance market after the deregulation of the auto insurance industry in Massachusetts. Insurance firms have been setting up business since April.

Insurance rates in the Bay State were dictated by state regulators. The regulatory environment had put restrictions for better coverage terms in policies, as well as discounts.

The deregulation was initiated in a new "managed competition" system, wherein companies could schedule their own rates. The state's function is now limited to an oversight role.

The deregulation is aimed at lowering insurance costs for drivers and car owners.