Attorney General Bob Ferguson said today that a Thurston County Superior Court judge is seeking to suspend his office’s investigation into possible racial discrimination against Washington state drivers by subsidiaries of PEMCO Mutual Insurance Company and Progressive Corporation. announced that it had rejected an attempt to do so. Both companies use a consumer’s credit history, or a “credit-based insurance score” derived from the consumer’s credit history, to determine whether and at what price to sell auto insurance products. colour.
PEMCO and Progressive have a large presence in Washington State. PEMCO has issued approximately 160,000 individual automobile insurance policies to Washington citizens. Progressive likewise insures a significant portion of Washington state drivers. Both companies openly use credit histories and/or credit-based insurance scores to decide who to offer coverage to and at what price. According to publicly available information, PEMCO charges a person with a low credit score three times as much as a person with a high credit score. Progressives likewise significantly increase premiums for individuals with negative credit histories.
Both companies took the case to court, opposed the authorities’ investigation, and made the investigation public.
The agency has a long-standing policy of not commenting on investigations, including confirming whether there are any. But in the fight to suppress the Attorney General’s demand for an investigation, the insurance company has unveiled the investigation. Given the grave importance and public interest of the practice under investigation, the Secretariat is providing its comments.
“Washington’s law is clear: Unfair, deceptive, or discriminatory business practices are illegal,” Ferguson said. “Even though driving histories of people of color are as safe as white drivers, there is significant evidence that using credit history to price insurance disproportionately affects people of color. Yes, my office is responsible for investigating racism against Washingtonians, and I will.”
Analysis shows that the use of consumer credit histories and/or credit-based insurance scores disproportionately impacts drivers of color, even if their driving records are as safe as those of white drivers. It is shown to give In 2020, the consumer advocacy group Consumers Federation of America found that black drivers were “more likely to be ‘better than whites’ when insurers relied on non-driving factors, such as credit scores, to price insurance products. We will pay more for car insurance.” Even if everything related to driving safety and vehicle type remains constant,
According to one media report, this A “long history of discrimination” in lending, banking, and government programs is well understood to “impact the data used by today’s credit scoring models.”
According to the Consumer Federation of America,[b]Higher levels of uninsured driving among African Americans due to mandatory insurance in all states except New Hampshire and different rates leading to state uninsured driving penalties for African Americans rate may be higher. It also means less access to cars and less access to jobs, as the link between car ownership and employment opportunities is well established. ”
As part of its investigation, the Attorney General’s Office is seeking information about PEMCO and Progressive’s compliance with the Washington State Consumer Protection Act and the Washington State Nondiscrimination Act.
Washingtonians who had information that PEMCO or Progressive used their credit history to price auto insurance or to determine whether to provide auto insurance experienced discrimination as a result of these practices. Wing Luke Civil Rights Division should be contacted, including those who believe that Call 1-833-660-4877 and select option 9 from the main menu. Individuals may also contact the Office of the Attorney General by email at AutoInsurance@atg.wa.gov.
Assistant Attorneys General Yesica Hernandez and Patricio Marquez, and Assistant Attorneys General Anna Alfonso and Allie Lard acted on a motion to enforce the Office of the Attorney General’s request for an investigation.
Washington state antidiscrimination laws prohibit insurance transactions based on race, color, national origin, religion, citizenship or immigration status, sex, marital status, sexual orientation, disability, or honorably discharged veteran or military status. prohibits discrimination in
The Wing Luke Civil Rights Division was established in 2015 to protect the rights of all Washington citizens by enforcing state and federal antidiscrimination laws. It is named after Wing Luke, who served as Washington’s Assistant Attorney General in the late 1950s and his early 1960s. He became the first person of color elected to the Seattle City Council and the first Asian American elected to public office in the Pacific Northwest.
Individuals can file civil rights complaints here.
Source: Washington State Attorney General