Reports: Safe driving doesn’t guarantee low insurance rates

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BUFFALO, N.Y. (WIVB) — If you thought a safe driving record was the key to low insurance rates, new research by Consumer Reports and other watchdog groups might just change everything you thought you knew about car insurance.

All the research seem to say the same thing: the factors car insurance companies are using to set your rates has little or nothing to do with the way you drive.

“They are more reflective of the consumer’s socio-economic status,” said Norma Garcia, a senior attorney for Consumers Union which conducted the survey for a special report in the latest ConsumerReports, called “The Truth About Car Insurance”.

Garcia said of these new revelations, “there are some very good drivers that are being penalized in the form of higher insurance costs, based more on who they are than how they drive.”

Consumers Union conducted a two-year investigation taking more than two billion quotes from insurance carriers, and found a driver’s credit score is often more important than their driving record.

A New York driver with a clean record pays on average $1,403/year with excellent credit. If the driver has good credit $1,658/year; a driver with poor credit pays $3,162.

But a driver with a DWI conviction will pay $2,573 a year for car insurance, which is $589 less than a driver with a clean record, but poor credit, just because the DWI driver has excellent credit.

Garcia said that just does not encourage safe driving, “That kind of result where someone pays more just because they have a lower credit score is an indication of how upside down this pricing structure really.”

A study conducted by the Western New York Law Center shows other counter-intuitive results for drivers in the City of Buffalo.

Among the WNYLC results: a driver with a high school diploma pays 15% more for car insurance than a driver with a masters degree.

A female driver with a high school diploma pays 31% more than a male with a high school diploma.

Thomas Keily, Consumer Education and Data Coordinator for the WNY Law Center said they found those disparities between bank tellers.

“A female bank teller with a high school diploma was paying 31% more than a male with a high school diploma, and was working as a bank teller as well.”

Keily also said insurance regulators instates such as California and Hawaii are disallowing insurance carriers to use credit scores as factors in setting insurance rates.

The WNY Law Center is continuing its research into car insurance rate-setting, and if you feel you are being gouged by your car insurance carrier the Western New York Law Center wants to hear from you, at 855-0203.

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