California Survey: Majority Feel Auto Insurance Rates Unfair And Discriminatory

A survey released today by EMC Research and commissioned by Root Insurance, found that nearly six in ten (58 percent) California voters indicated they are dissatisfied with the fairness of auto insurance rates in California and just over half feel the current way auto insurance rates are determined in California is discriminatory.

"California voters are clearly ready for changes in the state's auto insurance market," said Ruth Bernstein, President and CEO of EMC Research. "Dissatisfaction with auto insurance rates and other important factors is very high, with many California voters feeling that the current system is inherently unfair. In particular, key constituencies who could benefit the most from insurance market changes are among the most dissatisfied with the status quo and are the most supportive of important changes. These groups include young people, people of color, and those with lower incomes."

Many voters feel there is a lack of affordable auto insurance options. Satisfaction ratings were low with regard to the availability of affordable auto insurance for two key populations – low-income households and people under the age of 25. In each case, unsatisfied ratings more than doubled satisfaction ratings.

The level of dissatisfaction with auto insurance rates is much higher among key demographic groups, with 70 percent of lower-income voters saying they are unsatisfied with the fairness of rates, 64 percent of Latino voters, 61 percent of Asian/PI voters, 59 percent of African-American voters, and 61 percent of Democrats. Only 11% of African-American voters and 17% of Latino voters are "satisfied" with the availability of affordable auto insurance for low-income drivers.

58 percent of Latino and African-American voters believe the current way auto insurance rates are determined is discriminatory.

"This survey clearly outlines the dissatisfaction among Black consumers with respect to auto insurance rates," said Edwin Lombard, CEO of the California African-American Chamber of Commerce. "Black and Latino voters feel discriminated against and that won't change unless we make changes to give them more fair and equitable options."

When asked to choose whether rates should be determined based on how someone drives versus their demographic makeup, voters overwhelmingly choose the former, with a majority saying that the quality and safety of someone's driving should be the greatest determinant of their auto insurance rate and not driver demographics.

The survey was commissioned by Root Insurance which allows drivers to voluntarily use modern technology to measure actual driving behavior to provide a more fair and equitable way to rate auto insurance, an option offered to drivers in most other states.

More than 30 years ago, California voters approved reforms to replace the state's antiquated insurance regulatory system. For the most part these reforms worked. But much has changed in the past 30 years, and California's auto insurance regulations need modern interpretations to allow consumers to take advantage of technology innovations that make insurance cheaper and better for them.

The survey of 1,000 registered California voters was conducted by EMC Research between November 16 – 24, 2020. The results have an overall margin of error of ±3.1 percentage points at the 95% confidence level.

About Root
Root Insurance is the nation's first licensed insurance carrier powered entirely by mobile. We were founded on the belief that the services you need for everyday life should serve you better. That's why we base insurance coverages on you, not your demographic. It's the way insurance should be. And it's all conveniently in an app.

Root is headquartered in Columbus, Ohio, with renters insurance available in Arkansas, Missouri, Ohio, Georgia, Kentucky, Nevada, Tennessee, and Utah, and auto insurance currently available to drivers in Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maryland, Mississippi, Missouri, Montana, Nebraska, New Mexico, Nevada, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, and West Virginia.

Homeowners insurance, provided through Root Home, is also available in Ohio, Nebraska, Connecticut, Arizona, Colorado, Missouri, Nevada, Oklahoma, Utah, Delaware, Oregon, Iowa, Illinois, Georgia, Tennessee, Pennsylvania, Kentucky, and Texas. All of Root's products and programs will be coming to more states soon.

For more information, visit https://www.joinroot.com.