If you drive a car, you probably already know that your driving record affects the amount you pay for auto insurance. But what you might not realize is that that price you pay can be greatly affected by purely demographic information — like your zip code.
A landmark 2015 study by the Consumer Federation of America showed that a good driver living in a primarily black neighborhood was likely to be charged 70% more than a similar driver in a white neighborhood. This effect was seen even after accounting for population density and income levels. The reason, according to the insurance industry, was risk, meaning that the number of claims and their cost drive up insurance in those neighborhoods, even for motorists who have never been involved in a collision.
Now a new, first of its kind analysis by our colleagues at Consumer Reports and ProPublica has shown that some insurers charge, on average, higher liability premiums in predominantly minority zip codes than in similarly risky non-minority zip codes. In some cases, ProPublica and CR say that major insurers were charging premiums that were on average 30 percent higher in zip codes where most residents are minorities than in whiter neighborhoods with similar accident costs.
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12 comments:
oh well ...
I would think that insurance rated would be higher for the zookeeper taking care of the lions and tigers than the one taking care of the duck pond, but that's just me.
Get a job and get off of welfare and move to a better zip code.
yup but snowflakes dont understand that.
I'll bet if I tow my boat with my Porsche and park it in a "certain" neighborhood, I could have an insurance claim within 8 hours.
There's good reasons for Insurance companies to charge by zip code or skreet name! It's just a reality based thing, really.
Nice analogy, 7:27.
My kids grew up in the same place, my boys pay higher insurance but my daughter had more accidents. Life ain't fair and sometimes it sucks. Sela viene
Any relation to crime statistics?
So go take your new car and park it overnight in the black neighborhood.
duh, and why wouldn't they...it's obvious if you live in an area where there is more crime, etc. that you would pay more for insurance. what about flood zones, earth quake prone, and on and on.
what idiots come up with this crap...COMMON SENSE is lacking everywhere...Come back Common Sense.
Yeah, it's NOT because a lot more cars are stolen, more cars are broken into, more tires are stolen, more car windows broken, and more accidents occur in the ghetto.
It's because they are black and we are all racists.
Nailed it again.
HELLO? Which neighborhood(S) contain the most risk? HINT: Aint Dennis the Menance's - Hey there Mr. Wilson's neighborhoods!
Insurance Co's actually have been doing this for years!! Its just that some neighborhoods have zero clue they are charged more (if they have insurance at all!)
One of the many things insurance companies base their rates on is your credit. They usually run a credit report on the person applying for insurance. Most people in minority neighborhoods have terrible credit. I see this on a daily basis. Thus the higher premium.
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