Should using driver demographic information be illegal?

Isn't it unfair that companies use statistics to determine rates? I don't understand why it's legal for them to use personal information to price car insurance.

Answer
“It can seem fishy when car insurance companies use statistics to set prices for their customers. That said, companies are worried about insuring customers who are risky and will cause a lot of damage.
To alleviate risk, companies calculate the appropriate cost based on your personal information, such as:
  • Age
  • Location
  • Gender
  • Marital status
  • Education
This helps companies predict how much drivers may potentially cost them. However, you don’t have to worry about being a victim of demographics. There are laws against redlining. These laws prevent an insurance company from denying coverage based on your geographic area or without any underwriting basis.
Don’t stress if you have tickets, accidents, or are a young driver. While you may belong to one of these statistically riskier categories, you can still qualify for discounts through your company. Common discounts include a driver training course or a telematics program.
If you need help finding cheap car insurance, use Jerry. Jerry is a licensed broker that finds the best rates for you from up to 50 top insurance providers.”
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Sophie Newman
Answered on Sep 14, 2021
Sophie Newman is a writer from California. Her hobbies include brewing her own kombucha, riding horses, and taking long road trips.
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