Supporters demand action on bill to end discriminatory car insurance rates

A coalition of business leaders, racial justice groups, and consumer advocates are calling on the New Jersey Assembly and Assembly Speaker Craig Coughlin to advance a bill intended to root out racism in auto insurance rates.

The Fair Auto Insurance Rates Act would prohibit insurers from using factors like education, occupation, credit score, marital status, and homeownership status in setting car insurance rates. Those factors are “income proxies” that have nothing to do with someone’s driving record and that allow insurers to discriminate against drivers of color, supporters of the bill say.

The Senate passed the bill in January, but it hasn’t moved in the Assembly, irking advocates.

“This is a racial and social justice priority that must be addressed now, not next year or the year after,” said Cuqui Rivera, executive secretary of the Latino Action Network. “Car insurance is a major expense and is essential for any family trying to build wealth and economic security.”

Studies by the Consumer Federation of America found car insurance companies often charge higher premiums to safe drivers who rent their homes, are single, work in blue-collar professions, and have less education and lower credit scores. Black and Hispanic drivers are disproportionately impacted, researchers found. Recent studies by Insurify and Consumer Reports reported similar findings.

“We elected our Assembly to ensure all New Jerseyans have the same opportunities to prosper,” said Dena Mottola Jaborska, associate director of New Jersey Citizen Action. “Delaying this vote any further perpetuates a longstanding hardship on our communities of color and our working families. We urge the Assembly to put their interests before that of insurance companies, and take action now.”

The coalition includes the New Jersey African-American Chamber of Commerce, Fair Share Housing Center, the New Jersey Anti-Poverty Network, and the Consumer Federation of America, among others.