EDITORIAL: Quit overcharging women for auto insurance

Women shouldn’t have to pay more for auto insurance just because they are women.

As self-evident as that may sound, a Chicago Sun-Times investigation has found that being a woman can add $370 a year to an insurance quote — even for a woman who has a spotless driving record.

That’s absurd, and Illinois can do something about it.

To consider race, ethnicity or religion in setting insurance rates already is illegal, and seven other states already ban the use of gender in setting car insurance rates. Any disparity in insurance rates based on nothing but gender is indefensible.

As Stephanie Zimmermann reported in Sunday’s Sun-Times, Farmers Insurance quoted a female driver $327 to $370 more for yearly coverage than a male neighbor who otherwise had the same characteristics and lived on the same block — and this held true in eight Chicago neighborhoods.

In contrast, State Farm quoted no price differences, and Allstate actually quoted a male driver about $18 more a year. The quotes were for bodily injury/property damage insurance, and did not include collision coverage or comprehensive coverage for such incidents as vandalism, car break-ins or theft.

Several other studies also have found that women often pay more for car insurance than men do. A 2017 Consumer Federation study found that 40- and 60-year-old women with perfect driving records are much more likely than men to be charged more for basic coverage. But an analysis by EverQuote of 781 million miles of driving data from 2017 showed that men and women have similar driving scores.

The insurance industry says companies base their quotes on a wide range of variables and historical data that indicate who is more likely to file claims over an accident. They also say if states take too many variables out of the equation, insurance companies might stop offering coverage in certain areas, which would reduce competition and lead to higher prices.

But gender plays no legitimate part in that equation. As California’s insurance department said, “Gender’s relationship to risk of loss no longer appears to be substantial.” The department also described the statistical basis for gender-based price differences as “suspect.”

Besides the disparity in quotes for men and women, the Sun-Times also found that consumers unlucky to have a combination of factors — such as renting instead of owning a home or holding an unskilled job — could get a price quote that’s 33 percent higher than what their neighbors would be asked to pay.

Illinois lightly regulates its insurance market, compared with other states. Too lightly. Our state needs to do better.

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