fbpx Skip to content

California Commissioner: Data Shows ‘Disturbing’ Disparities in Auto Insurance Discounts

13-percent-increase-in-fatal.jpg

The California Department of Insurance on Tuesday released data from an investigation showing what the CDI is calling “wide socioeconomic disparities” in auto insurance group discounts offered to millions of California drivers.

The CDI says the investigation illustrates that many affinity groups disproportionately and adversely affect drivers residing in ZIP codes with lower per capita incomes, lower levels of educational attainment, and larger communities of color.

Some insurers offer lower automobile premium pricing to certain “affinity groups” including white-collar occupations and highly skilled workers, according to CDI data, which shows that one-quarter of Californians receive an affinity group premium reduction ranging from 1.5% to 25.9% depending on the insurer and group.

California Insurance Commissioner Ricardo Lara called the new data “disturbing” after the first affinity group fact-finding hearing in the CDI’s history last week in Los Angeles.

“This disturbing data confirms what we have heard for years, that auto group discounts do not apply equally across California,” said Insurance Commissioner Ricardo Lara. “We are evaluating whether insurer affinity group discounts violate state laws, and I am prepared to act to ensure all Californians have access to affordable auto insurance regardless of their income, education, or ethnicity.”

Mark Sektnan, vice president for the American Property Casualty Insurance Association, issued the following statement in response to the investigation:

“It must be made clear that affinity groups are created by consumers not insurers. California law only allows for the creation of consumer-initiated affinity groups. Insurers are explicitly prohibited from creating these groups. Over the last 30 years, a wide range of organizations have formed and benefited from affinity groups including labor unions, teachers, small business owners and their employees, law enforcement, among hundreds of others.”

Sektnan in his statement argued that if affinity groups are restricted, millions of California drivers already in these programs could be forced to pay more for auto insurance, but if changes are to be made, more affinity groups should be created to encourage greater access.

Among the findings released by the CDI:

This content was originally published here.

Auto Listings
Motorcycle Listings
Life Listings
Health Listings
Home Listings
Small Business Listings

Leave a Comment





This site uses Akismet to reduce spam. Learn how your comment data is processed.

RECENT POSTS

Save on Car Insurance: Top 5 Ways to Secure a Cost-Effective Auto Policy

October 17, 2019

We are all trying to save more money, but sometimes there don’t seem to be any areas to cut back. One avenue to explore is ways to save on car…

Read More

All Risk Home Insurance Coverage: It’s a Risky Business to Go Without

October 15, 2019

We have all heard the horror stories about people not buying specific insurance coverage and then losing their homes to a tragedy. After an earthquake in California, our neighborhood chat…

Read More

Gap Coverage 101: What You Need to Know About Health Insurance

August 22, 2019

Mind the Gap There are several situations in life that cause people to either change their health insurance, end their health insurance, or have a gap in coverage. I recently…

Read More

Motorcycle Insurance 101: First Time Riders

August 13, 2019

The Cool Commuter When you think of motorcycles, a few things come to mind. Typically, they are thoughts related to the Sons of Anarchy. However, there are actually a lot…

Read More

Could a Hybrid be the Answer to Your Commuter Blues?

August 13, 2019

If you are a commuter that drives into work or school daily, then you may have noticed that there are more cars on the road than ever before. Big cities…

Read More

Small Business Insurance 101: Construction

August 3, 2019

Construction and Insurance Home improvement is a trend that looks like it is here to stay in the US. With shows like Fixer Upper and Love it or List it,…

Read More

Road Trip and Car Insurance: Being Prepared

July 20, 2019

Road Trip Preparation Summer vacation is something that we look forward to all year. Here at Insuravita, we know that nothing ruins vacations like an unexpected insurance mishap. One of…

Read More

Average Costs of Teen Drivers: Teenagers and Auto Insurance

June 5, 2019

It is stressful to be a teenager and stressful to raise a teenager. And everything changes at age sixteen. Suddenly, teenagers are learning to drive and there are so many…

Read More
Scroll To Top
%d bloggers like this: