Report: Car insurance companies charging minorities higher rates

Car insuranceCollins: “This is a pattern of discrimination all too familiar to people of color.”

SPRINGFIELD – State Sen. Jacqueline Collins expressed disappointment at news that a major insurer has been charging minority clients more for car insurance, and also called for a renewed push for car insurance rate regulations Wednesday.

“This is a pattern of discrimination all too familiar to people of color at every level of modern life,” said Collins, D-Chicago. “I commend the journalists who looked into this issue. Their work verifies what many suspect: That the playing field is not level.”

In a study that included the Chicago area, Consumer Reports and ProPublica reported that drivers in minority neighborhoods pay significantly more than those in white neighborhoods, even accounting for differences in actuarial risk. Of 34 insurers in Illinois, 33 percent had an average rate difference between minority and non-minority neighborhoods of 10 percent.

Collins is sponsoring Senate Bill 1706, which would disallow the insurance companies from using a person’s credit score to determine his or her insurance rates. Collins said this unrelated information has no effect on how well somebody drives or any bearing on the risk level of their particular neighborhood, and has the potential to adversely affect minority communities.

“Providing a fair marketplace for consumers is a constant struggle, and stories like this remind us of that,” Collins said. “I’m urging my colleagues in the Senate to help me pass this legislation and to consider an inquiry into how we hold the insurance industry accountable to the public.”

Senate Bill 1706 is under discussion in the Senate Insurance Committee.

Sen. Jacqueline Y. Collins

Deputy Majority Caucus Chair
16th Senate District

Years served:
2003 - Present

Committee assignments: Financial Institutions (Chairperson); Insurance; Transportation; Subcommittee on Capital (TR).

Biography: Born in McComb, Miss.; grew up in the Englewood neighborhood of Chicago. Studied journalism at Northwestern University and graduated from Harvard University's John F. Kennedy School of Government and Harvard Divinity Schoool. Emmy Award-nominated news editor at CBS-TV in Chicago and 2001 Legislative Fellow with U.S. Sen. Hillary Rodham Clinton. Recipient in 2011 of a Lifetime Achievement Award for Financial Literacy Leadership from the Illinois state treasurer.

Associated Representatives:
Mary E. Flowers
André Thapedi