Study Finds Car Insurers Raise Rates in Minority Neighborhoods -
A new analysis of car insurance in four states found
that drivers living in some minority neighborhoods were charged higher rates than similar drivers in mostly white areas, even when the average risk of a claim was similar.
Asked if the discrepancies could result from an unintended consequence of the formulas used to
set rates, Mr. Lynch said, “There is no unfair discrimination, intentional or unintentional.”
Because individual insurers do not publicly release their losses on a ZIP code level, the analysis is based on aggregated losses by insurers.
The report examined quoted insurance premiums, as well as average claims paid by insurers — the first
use of payout data to examine racial disparities in car insurance premiums, the researchers said.
In a call with reporters on Wednesday, Mr. Lynch said the institute had commissioned its own actuarial analysis of ProPublica’s data and determined
that the conclusions drawn from the study were “flawed.” The institute did not make its analysis available because it was in draft form, he said, but expected to make it available when the report was completed.
Drivers should compare rates often, said Tobie Stanger, a senior editor at the magazine,
because the supposed benefit of getting a discount by remaining with the same insurer for a long time is “mostly a myth.”
Typically, one or two insurers will offer lower rates in a given state.