The Big “I” stands ready to work with Congress to protect consumers from unfair discrimination while also preserving the state-based system of insurance regulation.
Earlier this week, Sen. Cory Booker (D-New Jersey) introduced legislation in the U.S. Senate to prohibit the use of certain factors to determine auto insurance rates and eligibility.
The bill would ban the use of credit scores, income, education, and other factors that are suggested to be discriminatory and disproportionately target lower-income and minority consumers. This bill also has companion legislation in the U.S. House of Representatives that was introduced by Rep. Bonnie Watson Coleman (D-New Jersey).
While the Big “I" absolutely supports the underlying goal of protecting consumers from unfair discrimination, the Big “I" also believes that state regulators are in the best position to address any potential concerns in their respective markets, not the federal government. Specifically, this legislation would undermine state regulators by giving the Federal Trade Commission regulatory authority over some aspects of insurance underwriting.
In March, the House Financial Services Subcommittee on Housing, Community Development and Insurance held a hearing on the issue and, among others, heard testimony from Elizabeth Kelleher Dwyer, superintendent of insurance from Rhode Island, who stressed the benefits of protecting consumers via the state-based system.
While the Big “I" has concerns over the legislation, it stands ready to work with Congress to protect consumers from unfair discrimination while also preserving the state-based system of insurance regulation.
Joseph Cortina is Big “I" director of federal government affairs.