Auto insurance quotes are higher for blue-collar applicants
It would be good to think America always operated on basic principles of fairness so that regardless who you were, you always got a fair deal. After all, the capitalism that has made America a great country should not care about the individuals as people. The only thing that should matter is their ability to pay. If they have the money to pay the going rate, they should be allowed to buy. There should be no loading or additional premium added to the price. It should be the same price for all. This is not to say, of course, that prices can't be used to discriminate. Some branded goods deliberately set high prices so that only people of a certain income group can afford to buy. That said, the price is out there for all to see. It doesn't change depending on who walks in through the door of the shop or office. If a poor person wants to spend a month's pay on a single item and go without food, he or she is allowed to do that. That's the strength and, some would say, the weakness, of capitalism. But that's not how the insurance industry works. The annual premium rates sent out in the auto insurance quotes change depending on the apparent class of the individual applying for cover.
The way you describe jobs
Taking this as a matter of common sense, there are people who live close to the place where they work and never leave that place during the working day. So apart from the drive to and from work, they are not at risk. But other people may have long drives to get to work and then have to make further road journeys as a part of their job descriptions. The more miles a person drives, the greater the risk of an accident, particularly if these miles are at peak periods on busy highways. So if we were assuming some level of discrimination, it would not be based solely on the nature of the work. It would be a whole cluster of factors starting with the zip code where we live, the distance to the place of work, the time the work starts and finishes, the nature of the duties, and so on. Applying this, an office worker in a downtown area must drive through heavy traffic. A blue collar worker might drive to a less congested area for heavy industry. A senior corporate executive might spend hours on the road driving to meetings with clients, keeping in touch with the office using all the latest technological gadgets.
A recent survey by the Consumer Federation of America has confirmed that blue-collar workers pay more for their auto insurance than white-collar professionals. So the CEO would receive a lower car insurance quote than a worker at the local steel mill. Why is this? One answer is the insurers are looking for the higher income households that can be targeted with marketing for the entire range of financial products and services. The first contact a young adult makes with an insurance company is through the search for auto insurance. If the applicant looks as though he or she may go on to earn a high income, this person will want insurance for health, home ownership, life and wealth management services. The better the long-term prospect, the more attractive the auto insurance quotes will be. Although this is a British view of the problem, it's equally true on this side of the Atlantic.
Some makes and models of vehicle are well-known to thieves as being easy to break into or steal so a fairly obvious strategy is to leave cars matching this list in and around areas the police know have a higher rate of crime. Each of the vehicles is equipped with cameras and sone have immobilizers so that, if the thieves attempt to drive away, the doors can be locked remotely and the engine switched off until the arresting officers arrive. Why should local insurance companies cooperate by subsidizing the cost and fitting out of these vehicles. Because anything done to reduce the rate of thefts saves them money (and reduces the car insurance quotes for their policyholders). Here's a report of the success in Albuquerque:
People who fail to get or only get a high school diploma cannot get the jobs to earn the lower premium rates. The Consumer Federation of America confirmed the majority of insurers rely on education and jobs to set the rates. The lower the level of educational achievement, the higher the annual premium. Put the other way round, students who get a GPA of B or better earn discounts. Those who go on to college and university get even better auto insurance quotes than those who leave school to get the low-paying jobs. It's a vicious circle whereby the poor are penalized because of who they are and how the education service fails them. Here's a general view of the problem.
It confirms the basic need is to give the poor a good education in a safe environment and create jobs for them to do. The failure of cities like Detroit is a warning we're not doing enough for the disadvantaged people in America. Educational provision is often directed to the middle and upper class areas where the "better students" are said to live. It all becomes a self-fulfilling prophesy where the advantaged get on and the disadvantaged are left to pick up bills they increasingly can't afford to pay.
Zip codes and credit scores
The final two nails in the coffin are where people live and their credit scores. People who don't have the right educational qualifications can't get the best jobs so can't afford to live in the better parts of towns and cities. Because they struggle for money, they have poor credit scores. The prejudice is therefore that these people are irresponsible and potentially criminal. If they get into financial trouble, they are likely to steal cars or, having insured their own car with comprehensive cover, set fire to it and make a false claim. This is why some states have imposed detailed regulations which prevent insurers from taking the zip code or credit score into account.
In these states, the car insurance quotes come in at a more even level across the different neighborhoods. In other states which allow insurers to rate the areas where people live based on the crime statistics, there can be up to 80% difference in the quoted premium rates between one neighborhood and another. If you think you might try to avoid this penalty by giving a relative's address as your own, here's a warning:
If the insurers realize the deception, they will refuse all claims and can refer you for prosecution. Sadly the fact this approach to setting rates actively discriminates against the poor who often belong to racial minorities is not something the insurers like to discuss. In theory, there are laws to prevent discrimination against people based on their race. Assessing higher auto insurance quotes for these groups is based on statistical evidence not their race. Or that's would the insurers would like you to believe.