Watchdog: Auto insurers overcharging the poor
http://money.cnn.com/2012/01/31/pf/auto_insurance_rates/index.htm?iid=HP_LN
NEW YORK (CNNMoney) -- The car owners who are least able to afford high auto insurance rates are getting charged the most for coverage, according to a consumer watchdog group.
In a report released earlier this week, the Consumer Federation of America claimed that auto insurers are using pricing methods that put low- and moderate-income drivers at a disadvantage, frequently charging them much higher premiums than higher-income drivers.
171PrintCommentThe report, which took into account more than 100 auto insurance pricing studies including several of its own, claimed that insurers used factors, such as education, where a person lives and works, credit history and age to determine the amount they will charge. While it's illegal in all 50 states to base insurance rates on race or income level, the CFA claims these other factors are a backdoor way for insurers to determine a customer's income level.
The consumer group said it also found that low-income customers often paid more for less coverage.
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