SBLI bill signed after CEO gave to Murray’s campaign
The Patrick administration has reversed course on major legislation affecting the largest life insurer in Massachusetts, after the company threatened to leave the state and its CEO contributed to the lieutenant governor’s political campaign just before he signed the bill into law.
The law allows the Savings Bank Life Insurance Co. of Woburn to begin charging different rates for life insurance it sells to men and women, after having long been forced by state law to charge the same rates.
Lieutenant Governor Timothy Murray signed the bill into law on Sunday, as acting governor, while Governor Deval Patrick was returning from a trip to the Middle East. That happened six days after Murray’s reelection committee reported receiving a $500 contribution — the maximum annual donation — from SBLI’s chief executive, Robert Sheridan.
Patrick and a Murray spokesman denied there was any quid pro quo, as did Sheridan.
“It is absurd to suggest that the legislative process can be influenced for a few hundred dollars,’’ Sheridan said.
In 2008, the House and Senate approved a bill dropping SBLI’s gender-equality requirement, saying it put the company at a competitive disadvantage.
Nonetheless, Patrick scuttled the bill then and proposed requiring all Massachusetts insurers live under the same rules as SBLI. SBLI later threatened to move its operations out of state. And this month, the House and Senate approved a similar bill. The new legislation allowed SBLI to act like all the other insurers by charging different rates for men and women.
“This is a bill that essentially treats all insurance companies alike,’’ Patrick said yesterday.
SBLI said the change would allow it to compete locally and nationally. “This legislation also stands as an example of how the Patrick administration and the Legislature are enhancing the business climate,’’ it said.
But opponents said the law eliminates consumer protections. The law calls for replacing the Policyholders Protective Board, a group of seven people who review SBLI’s finances, with an advisory board consisting of the same members. But the new legislation does not guarantee that a member of the new board will hold a seat on SBLI’s board of directors or be able to regularly review the firm’s finances.
“Consumers lose something when we had extra protection built into that institution to make sure that consumers wouldn’t get ripped off,’’ said Deirdre Cummings, legislative director of the Massachusetts Public Interest Research Group, who had urged Patrick to veto the bill.
Globe correspondent Bonnie Kavoussi contributed to this report.