athima tongloom

California officials proposed a rule on Tuesday that would cut discriminatory pricing practices being used by auto insurance companies in the state. The California Department of Insurance found in a recent investigation that many insurers have been selling higher-priced auto-insurance policies to people of color and low-income drivers in the Golden State, by more frequently offering discounts on insurance premiums to more affluent, white drivers. Insurers are supposed to determine auto-insurance rates in California based primarily on a customer's driving safety record, miles driven annually and years of experience, said Jamie Court, president of Consumer Watchdog, a consumer advocacy group. All other factors must count less than these three and be substantially related to an insurer's risk of loss from a particular customer or group.

Just because you have a good job or a good education doesn't mean you should be paying less for your auto insurance. Jamie Court President of Consumer Watchdog

Discriminatory pricing practices could lead to marginalized groups paying rates that are up to 26% higher than their privileged counterparts, California's investigation found. That could equate to several hundred dollars in additional insurance premiums annually, according to Court. "That's just wrong," Court said. "Just because you have a good job or a good education doesn't mean you should be paying less for your auto insurance." The practice of offering biased pricing based on factors such as race, education and occupation isn't unique to California — insurers use the practice to some degree, and often in worse ways, in every other state relative to auto insurance and other types such as home insurance, Court said. Insurers, he said, often prefer richer, whiter clients because they feel they make better customers from an economic standpoint.