As of January 1, 2019, California has banned gender discrimination in car insurance. Previous to this, car insurance companies considered a person’s gender when determining auto insurance rates. People often assume that men pay higher rates, and this is very often true. In any case, car insurance companies in California will no longer be able to do that, whether they are calculating initial policy costs or auto insurance renewal quotes.
The purpose of this move was to target pricing that is based on things people cannot change. The California Insurance Commissioner wants prices to reflect characteristics of the driver that they can improve and thereby decrease their rates.
This may be a win for the consumer, although that remains to be seen. Frequently, with regulation like this, there will be winners and losers. Males who may have paid more previously, may benefit from the regulation. However, women who may have paid less previously, may find their rates increase as a result.
The extent that this regulation will change rates has not yet been determined, but likely won’t cause a huge difference in prices. There are many factors beyond gender that go into auto insurance renewal quotes and now policy quotes.
Future Moves
It’s impossible to determine whether other states will follow this new policy. However, it’s likely that some will. It’s possible that more liberal states will adopt this policy before more conservative states. This is because conservative states tend to favor businesses.
This policy is a blow to insurance companies that rely on gender as a predictor of car accidents and other claims. As we know, these companies are quite large and may try to fight this new regulation.
In any case, consumer protection in important, but the main question is how it will affect your insurance premium? Check your personal insurance rates on this website to find out!
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