A recent report found that blue-collar workers, those on low incomes and those with low levels of education are having to pay more for their car insurance than others. This seems highly unfair, since insurance premiums should be based on the chance of making a claim, not on how much you earn or how well you learn. Besides this, people who are on a low income are already penalized enough in this day and age with the cost of living constantly rising, so why make this even more unfair than it already is?
The report that brought this latest travesty to light explained that the difference is actually incredibly large as well.
A Phoenix driver with only a high school diploma could be charged as much as 12 percent more in auto insurance premiums than a plant supervisor with a college degree.
The test was foolproof – a fictitious man was used to request insurance quotes. Certain variables were changed in each application and the only one that shouldn’t make a difference but did was his education level and subsequent job (one was a factory worker with no formal education, the other was a plant manager in possession of a college degree). Considering the obstacles that those on a low income, which are often those of lower education, already face, this is incredibly unfair.
And if you think the situation in Phoenix is bad, Chicago was found to be even worse.
Blue-collar workers without college degrees may pay as much as 21 percent more for car insurance in Chicago than a more highly educated plant supervisor, a study has found.
Up To 40% Higher Car Insurance Rates For Drivers in Lower Demographic Categories in Many Big Cities Across The US.
The problem seems to exist with all the major insurance providers and in all of the states. It should be clear that there are certain demographic factors, such as education and level of income, that do not have an influence over the likelihood of a claim being made and it is unclear what the insurance companies are basing the decision to go against these rules on. However, the insurance companies are saying that they have proof that people with certain occupations actually are at higher risk of being in an accident. Although they say this, the evidence hasn’t been forthcoming yet.
The worst city to live in for a low educated, low paid worker has to be Seattle, where the difference was as much as 40 percent with GEICO.
The GEICO quote for the factory worker with only a high school education was significantly higher than the plant supervisor with a college degree: 45 percent more per year in Seattle ($870 vs. $599), 40% percent more in Hartford ($1,299 vs. $926), 33 percent more in Oakland ($922 vs. $693), 23 percent more in Louisville ($2,200 vs. $1,791), 21 percent more in Chicago ($1,013 vs. $840), and 20 percent more in Baltimore ($1,971 vs. $1,647).
These figures are alarming and frustrating for people who are being demonized from too many different directions. A woman who has to work several jobs to support her family has to be able to drive a car in order to get to her numerous jobs. She is working hard in order to give her family the life they are entitled to. Why should she have to pay more car insurance compared to her boss? Why is it that a cashier, who receives little to no income, has to hand over a higher percentage of her income for car insurance than the manager of a grocery store, who is far more able to afford insurance prices anyway? Further investigation will continue to take place in this issue.