Issue Area
Insurance
Insurance
Insurance can support the financial stability of Texas families, but only if it is fairly priced and appropriately compensates customers in the event of a covered loss. Studies looking at the pricing of auto insurance are finding that many companies set pricing based on unfair and discriminatory factors such as gender, marital status, occupation, education level, or zip code. Auto insurance is of particular concern because all Texans who own a vehicle are required by law to purchase basic liability insurance.
Recent data from the Consumer Federation of America documents that drivers in low- and moderate-income communities of color often pay significantly more than neighbors in wealthier zip codes with predominantly white residents for the same level of auto insurance coverage. Too many safe drivers in Texas face premiums that appear to be driven more by the marketing goals of insurance companies than the actual risk that they will cause an accident. Fair, nondiscriminatory insurance pricing supports the well-being of families, as well as the integrity of our markets, and it is important that we have strong consumer protections in place.
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Key Statistics
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4 out of 5
Of the five insurance companies we tested in 2018, four charged women, people who are divorced, and widows different prices simply based on their gender or marital status, with women most often being charged more.
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$606 million
COVID-19 relief payments from auto insurance companies in Texas fell short by an estimated $606 million and $869 million. Seventy percent of the top 40 auto insurance companies in Texas offered some rebate, but not enough to balance out the sharp drop in driving in 2020.
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59%
Among zip codes where the majority of residents are people of color, just 59% have average insurance premiums that are affordable for those with poor credit compared to 93% of majority white zip codes.