Working class pays more for auto insurance
Study by Consumer Federation of America shows that those with less education and lower level jobs pay higher premiums.
The study compared how much minimum liability insurance -- the least allowed by law -- would cost for a factory worker with a high school degree vs. a supervisor at a plant with a college education. In Seattle, one insurer quoted a rate 45% higher for the factory worker. The worker also would pay 40% more in Hartford, Conn.; 33% more in Oakland, Calif.; and 21% more in Chicago.
Another insurer quoted a 33% higher rate in Baltimore for the factory worker. Other than their education level and income, based on their jobs, the rest of the information to get the price quotes was the same, the CFA said.
"Auto insurers charge high premiums for minimal coverage to most working people, even those with perfect driving records, who live in urban areas," said CFA Executive Director Stephen Brobeck. "Since most Americans need a car, and almost all states require the purchase of auto insurance, many lower-income workers are faced with the choice of paying these high -- and often unaffordable -- prices, or breaking the law by driving without insurance."
The CFA has long championed the idea of insurance rates not being influenced by economic factors. In January, the group released another study that showed an executive with a poor driving record who owns a home more often than not will get charged less than a receptionist who rents an apartment but has a perfect driving record.
The group cites a survey conducted last year that showed most Americans don't think education or income should play a role in insurance rate setting. Many insurance companies have maintained that these factors, and an applicant's credit score, have proven to be reliable predictors of the likelihood a policyholder will file a claim and therefore are relevant and should be considered when quoting a premium.
The CFA dismisses the industry's arguments and, based on the national survey, says American consumers do, too.
"The American public knows that it is unfair for auto insurers to use factors like education and occupation in setting rates," said CFA Insurance Director J. Robert Hunter. "In effect, auto insurers are discriminating on the basis of income and race. States should prohibit the use of these demographic factors that bear no logical relation to insurer risk."
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So let me see, A teacher or manager or some other managerial position person that makes $60K and thinks everyone around them at work or on the road should realize that they deserve more of everything including a break on their insurance. Simply because their circumstances allowed them to finish college and obtain the position they now hold.
Even with an atrocious driving record.
I had to struggle a bit more to earn my skills and keep my driving record clean. Yet it appears many believe that I should not qualify for better discounts. Oh by the way I earned 6 figures last year and have for the past several years. I don't struggle to get discounts, but I remember when I did.
As for insurance assuming risks well That's their business. From the looks of the buildings that harbor them and the bonuses the executives receive, I do not believe that they are in danger of bankruptcy.
The thing that offends me more than anything else is the assumption that anyone not fortunate enough to be highly successful will file a claim. The arrogance of a bunch of duffusses should outrage every person that has insurance, even those with better rates than others. Maybe your rates are still over priced.... Hmmm.
I Love America. Even though we may disagree, we have that right. I am fortunate, but I never look down upon anyone. I'm thankful that someone runs that little store where I get my overpriced gas and the guy that cuts my grass. The other millions of people that do jobs where the pay is less than stellar. Some of those people had no choice, family sickness/death or financial breakdown in their home as young people and they had to go to work. Their struggle reminds me how fortunate I am.
Those of you that think you are better than anyone else because of your circumstances, have just proven you are not.
Inspire, Encourage and always be a Beacon Of Hope to others.
i guess in a nutshell all of the poor me stories lead to one conclusion, dont be poor cause it sucks
or if you are so dismayed by how insurance companies rate their customers, go start your own insurance company take all the risk and do it your way ,i have a sneaking suspiscion that in a very short period of time when your house and car and family is at risk for your decisions you will start to understand why they rate people the way they do.
Not surprising, since most Americans aren't well-educated. As a retired teacher, the total premium on my near-Cadillac, BCBS health insurance, including prescription, dental, and vision coverage is $620 per month. The reason it's so cheap is because educated teachers take better care of themselves and incur less health costs. The copay for all tests is $0 -colonoscopies, blood tests, 3-day heart stress tests, etc.- because BCBS knows most teachers learn from and take action from the tests and save BCBS more than they'd pay if the test was never done.
Similarly, well-educated people have better driving records. I do agree that if you're a high-school dropout and haven't had an accident or ticket in 15 years you should get the best rates, but if you're going offer insurance to a young driver, statistics show you win by offering the better educated the lower rates.
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