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It’s worse than that, insurance companies can be both sexist and racist with no consequence. A friend of mine moved and was quoted a much higher rate for their
by KMnO4 6y ago
It’s worse than that, insurance companies can be both sexist and racist with no consequence.
A friend of mine moved and was quoted a much higher rate for their homeowners insurance, to which the agent replied “rates are higher in predominantly-black neighbourhoods”.
I don’t know how that’s legal.
- sokoloff 6y agoIMO, rates should be based on projected actuarial losses plus overhead and a (statistical) profit for the insurance company. From my own driving past (male), I’d expect that I was a worse risk in the 16-25 age bracket than most women I knew in that age range. Why shouldn’t I pay more?
- AlexTWithBeard 6y agoShould black male pay more than a white one? (and now we're stepping onto a really slippery slope)
- sokoloff 6y agoShould they pay more because they’re black? Of course not! Because they’re in a group which the actuarial data say costs more in payouts? Why not? Being black should be irrelevant; it should not itself cost a premium nor protect from paying a premium.
- AlexTWithBeard 6y agoSo if, say, black males 16-26 are statistically more likely to get into car crash than any other group, it's perfectly legal to make them pay the highest insurance premium, right?
- sokoloff 6y agoAssuming all other factors are equal (that the crashes are more frequent and equally costly per-crash to the insurance company, etc), then it’s perfectly appropriate to charge any cohort the most if they’re the most expensive cohort to insure. I can’t comment on the legality, as it might be illegal in some places.
- AlexTWithBeard 6y agoWell, following the same logic, should it be legal for a mall to ban entry to all black people, because they have the highest chances of being shoplifters?
- AlexTWithBeard 6y agoThe agent's reply was clearly illegal. And probably incorrect: I highly doubt these days any pricing model uses race as an input.