Department of Insurance Proposes Major Course Correction on Auto Insurance Group Discounts
The
The Department drafted the new regulations after Insurance Commissioner
"The Department's historic investigation found that many insurance companies were effectively using group discounts to 'cherry-pick' members, giving some higher-income occupations a 'fast pass' while people of color and lower income motorists were left in the slow lane," said Insurance Commissioner
Other key findings from the Department's investigation:
* Motorists in affinity groups are more likely to reside in ZIP Codes with a predominantly non-Hispanic white population.
* Three-quarters of motorists residing in underserved communities were not in an affinity group, compared to 57% for the rest of the state.
* Motorists in affinity groups are more likely to reside in ZIP Codes with a higher average educational attainment. Only 28% of those living in areas with the lowest number of college degrees receive discounts, compared to 56% for those where half or more have college degrees.
Proposition 103 permits groups to exist, but the Department's proposed regulations would ensure that groups are offered equally to persons regardless of sex, race, color, religion, ancestry, national origin, disability, medical condition, genetic information, marital status, sexual orientation, primary language, immigration status, occupation, educational attainment, or income level. This proposed action would effectively ensure that all Californians have access to insurance group discounts as intended by Proposition 103.
The Department will hold a prenotice workshop on the proposed regulations on
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