EDITORIAL: Our opinion: Are increased motorized vehicle insurance charges worthwhile with a purpose to scale back potential discrimination? [The Observer, La Grande, Ore.] – Insurance communications community

December 2 – Oregon allows insurers to determine how much to charge for auto insurance based on creditworthiness, gender, marital status, education, occupation, employment status, and more.

Are these things directly related to your ability to drive? No.

Do they help insurers gauge how much risk a driver can pose? Insurers believe that.

Two bills earlier this year proposed to allow insurers to use these factors to set premiums. Instead, the insurers would have to concentrate on the driving record, the kilometers driven and the years of driving experience. Apparently the idea will be revived in a bill for the short 2022 session.

Is it right It is not easy.

Governor Kate Brown and Oregon's Department of Consumer and Business Services endorsed these bills. Much of the department's reasoning has centered on creditworthiness. A low credit score can mean a person is paying more for insurance even if their driving records are clean. There are also concerns that the use of credit scores can be discriminatory. Black and Latino drivers are more likely than others to have lower credit scores. Similar arguments about discrimination were also made with regard to allowing insurers to use education, employment status and occupation.

The department also questioned the assumption that gender should be taken into account. For example, the National Highway Traffic Safety Administration has said that both men and women are equally distracted. As for marital status, a person is not necessarily a poorer driver because their spouse died or they divorced.

What would such changes mean for the insurance industry? Other states like California have restricted what information insurers can use. The ministry argued that the insurance industry is still going strong.

However, there are other things to consider. It would mean the premiums would go up for many Oregonians. The department says people with good or excellent credit scores would face increases and people with bad credit scores would pay less. "The cost reduction for people with poor ratings is four times as high as the premium increase for people with good or excellent ratings," says a graphic from the ministry.

Some people in Oregon also receive discounts because of their union or other group membership. These would be eliminated. That's one of the reasons the Oregon Coalition of Police and Sheriffs has spoken out against such changes.

Lawrence Powell, an insurance analyst at the University of Alabama, insisted in a testimony before lawmakers that the predictors the insurance industry uses are accurate and help adjust premiums based on risk. You are not perfect. They help. Work and education can help uncover hard-to-watch things like risk-taking. Gender and marital status can also correlate with kilometers driven and when and where people drive. He also said if the Oregonians had their insurance in California, where many of the policies are on the bills, they would have paid about 7% more.

It is not easy to know who will be a safe driver. Should the state of Oregon regulate how insurance companies can rate drivers? Tell lawmakers what you think. You can find it here: oregonlegislature.gov/FindYourLegislator/leg-districts.html.


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