The state agency that insures high-risk drivers wants to reduce rates by an average of 4.3 percent statewide.
It is the fourth consecutive year that the agency, the Maryland Automobile Insurance Fund, known as MAIF, has sought to reduce its rates. The agency's acting director yesterday attributed MAIF's increased profitability to juries that have made lower awards in lawsuits and to the agency's cost-cutting and anti-fraud efforts.
"We are seeing juries, courts, judges look more carefully at minor damage," said David C. Trageser, acting executive director of MAIF, which serves 145,000 people.
Particularly in the Baltimore metropolitan area, he said, "People are more cognizant in general that when an insurance company pays out a claim, it doesn't come from some deep pocket somewhere."
If approved by Maryland insurance regulators, the reduced rates would take effect Aug. 1. Regulators held a hearing on the proposed rate decrease yesterday.
In Baltimore City, the price of private passenger liability insurance would drop by an average of 3 percent under the MAIF proposal offered yesterday. A 30-year-old driver with a clean record would pay an average of $1,509 a year, compared with the current $1,556.
In outer parts of Baltimore County, Anne Arundel County, and Howard County, the new rate for the same driver would be $1,085, a drop of 5.2 percent.
The saving would be even greater, up to $225, for the more than 50 percent of MAIF-insured city residents who buy optional personal injury coverage to pay medical bills and lost wages of nonfamily members in case of injury. MAIF is proposing to slash the rates on such coverage by 13.2 percent.
City residents own 11 percent of the vehicles insured by MAIF.
MAIF earned $22.5 million on premiums of about $168 million in 1992. Once in poor financial shape, the company has seen its reserve grow to $120 million as it enjoyed profits over the past few years.
MAIF last reduced its rates in January, by an average of 4 percent.
The agency was chartered to pay claims against uninsured motorists and to sell insurance to drivers who have been rejected by commercial carriers -- usually those considered a higher risk because of their driving record or statistical profile. The insurance is available only to those who prove that they have been rejected by private companies.
But more than half the people who buy MAIF insurance -- about 48 percent -- have clean driving records. Mr. Trageser said commercial carriers reject applicants for other reasons besides their driving record, including a lack of ability to pay.