Published: July 2021

It’s time to dig deeper into sources of unfairness in auto insurance market

Consumer groups wrote to the Department of Treasury’s Federal Insurance Office (FIO) asking that the FIO prioritize an immediate update of its auto insurance affordability study using improved methods and conduct additional research on uninsured drivers, socioeconomic factors in auto insurance pricing, and how these factors have a disparate impact on people of color. As many families rely on automobiles to take them to school and work, it’s particularly important that auto insurance is available, affordable and priced fairly in the marketplace.

Consumer advocates urged the Department of Treasury’s Federal Insurance Office to update a 2017 study on the affordability of auto insurance in historically underserved communities and to conduct a deep and thorough investigation of unfair discrimination in auto insurance markets. While state laws in 49 states require drivers to purchase auto insurance, it’s often unaffordable for low-income drivers. Industry pricing practices that rely on non-driving, socioeconomic characteristics of customers disproportionately penalize people of color with higher premiums and fewer choices in the market.

Lead Organization

Consumer Federation of America

Other Organizations

Center for Economic Justice | Center for Justice & Democracy | CPAN | Consumer Action | Consumer Federation of America | Consumer Federation of California | Consumer Reports | Consumers for Auto Reliability and Safety | Demos | Georgia Watch | Job Opportunities Task Force | Latino Action Network | Los Angeles County Department of Consumer and Business Affairs | National Community Reinvestment Coalition | New Yorkers for Responsible Lending | Oregon’s Stop the Debt Trap Alliance | Texas Appleseed | The One Less Foundation | United Policyholders | U.S. Public Interest Research Group | Vehicles for Change

More Information

Click here to read the letter in full.

For more information, please visit Consumer Federation of America’s website.

 

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