Patrick administration signs bill benefiting Mass. insurer it opposed, shortly after donation

Patrick team signs insurance change it opposed

BOSTON — The Patrick administration has reversed course on major legislation affecting the largest life insurer in Massachusetts, after the company threatened to move out of 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 for both genders.

Lt. Gov. Timothy Murray signed the bill into law on Sunday, as acting governor, while Gov. Deval Patrick was returning from a trip to the Middle East. The signing occurred six days after Murray’s re-election committee reported receiving a $500 campaign contribution — the maximum allowable annual donation — from SBLI’s chief executive officer, Robert Sheridan.

Patrick and a Murray spokesman denied any quid pro quo, as did Sheridan.

“I know this lieutenant governor and that’s not how he or we work,” the governor said Monday.

Murray spokesman Alec Loftus said, “The lieutenant governor’s campaign receives financial support from many different people, from all walks of life, and these donations have never and will never affect any policy decisions.”

In a statement, Sheridan said, “It is absurd to suggest that the legislative process can be influenced for a few hundred dollars.”

In 2008, the House and Senate approved a bill dropping SBLI’s so-called gender-equality requirement, saying it put the company at a competitive disadvantage with other Massachusetts insurers. All but SBLI had been allowed to charge different rates for male and female customers.

Nonetheless, Patrick scuttled the bill then. In a letter explaining his position, the former Clinton administration civil rights chief said allowing SBLI to charge different rates was “retreating from fundamental principles of equality.”

Patrick proposed requiring all Massachusetts insurers to live under the same rules as SBLI, saying the company should be “a model of nondiscrimination and fairness.”

SBLI later threatened to move its operations out of state — along with the jobs for 300 Massachusetts residents. And this month, the House and Senate approved a similar version of the 2008 bill. Yet the new legislation did not require other insurers to act like SBLI; instead, it 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, and that is an argument that weighed against the threat of job loss that, I think, has to be respected,” Patrick told reporters Monday during a Statehouse news conference. “I think that there is work that remains — throughout the industry — in dealing with the gender-neutrality issues, and I think that’s a fight for another day.”

Asked to explain the sea change, Patrick said, “This is not the same bill,” adding that “we will make the industry grapple with the whole question of gender neutrality.” He cut off any further questioning on the subject.

SBLI said the change would allow it to compete not only locally, but nationally.

“This legislation also stands as an example of how the Patrick administration and the Legislature are enhancing the business climate and encouraging Massachusetts-based companies to stay here and grow,” the insurer said.

Sheridan’s donation to Murray, first reported by the State House News Service, will also benefit Patrick, since the two Democrats are running for re-election this fall as a team. Loftus and a Sheridan spokesman had differing recollections of when the donation was made.

First, they said the donation was made on June 23 — nearly a month before Murray signed the bill — and simply posted on July 19. Then a Murray spokesman corrected himself to say the donation was pledged at a June 23 fundraiser but the check not written until July 8 — still nearly two weeks before the bill signing.

Yet that was two days after the Senate voted to join the House in dropping the gender requirement, making the bill’s approval more likely. By then, all that remained were routine enactment votes in both chambers and the governor’s signature.

Under state campaign finance law, the donation should have been reported by July 15 — within seven days of its receipt. Instead, the Murray campaign did not enter it into the state’s electronic database until July 19.

Sheridan bristled at the suggestion of favoritism, saying in his statement that “it is disrespectful to the governor, lieutenant governor and to SBLI to suggest such a thing.”

He added: “Like many Massachusetts CEOs, I make donations supporting a host of candidates.” Sheridan noted the bill was passed by both the House and Senate, and, he said, “It does not in any way give SBLI special privileges.”

State campaign finance records show Sheridan giving Murray $500 in 2006; $200 in 2007; $250 in 2008, and $300 in 2009. The maximum allowable donation is $500 per year.

The records also show Sheridan donated $500 on April 1 to Treasurer Timothy Cahill, who is running for governor as an independent, and $500 in April and again last September to Republican Charles Baker, who also is running for governor this fall.