whose husbands die should not expect to receive much
sympathy from many of the nation’s major auto
insurers; it’s more likely that widows can expect to
have their car insurance rates raised.
Washington, D.C.-based Consumer Federation of America
found most major automobile insurance companies vary
their prices depending on marital status.
surprised us especially that when a husband dies, most
major auto insurers would increase the premiums for the
surviving widow," said Stephen Brobeck, executive
director of the consumer federation. "Most of the
major insurers charge all single people — whether they’ve
never been married, separated, divorced or widowed —
higher rates than those who are married.
claim that married people are safer drivers," he
said. "But there are no publicly available studies
that have shown that, and we are not aware that state
insurance departments have insisted that auto insurers
prove there is a causal relationship."
the 10 cities studied, four of six major insurers —
Geico, Farmers, Progressive and Liberty — increased
rates on state-mandated liability coverage for widows by
an average 20 percent. The fifth insurer, Nationwide,
sometimes increased rates for widows.
sixth insurer, State Farm, did not vary the rates it
charged because of marital status. All State Farm rate
quotes were the same regardless of whether the driver
was single, separated, divorced, widowed, a domestic
partner or married.
consumer federation research did not compare similar
rate increases for men who lost a spouse or single men
hypothetical person that the consumer group used in its
research on insurance pricing was a 30-year-old female
who has been driving since age 16 with no accidents or
moving violations. She has a high school diploma, works
as a bank teller and drives a 2005 Honda Civic, which
she owns. She also lives in a ZIP code with a $30,000
median household income and has insurance most recently
purchased three years ago.
the study, the researchers also increased the widow’s
age to 50 and found the price differences persisted.
it’s not unusual that the insurance industry is using
socio-economic factors rather than how we drive to price
auto insurance," said Robert Hunter, director of
insurance for the consumer group and former insurance
commissioner for the state of Texas. "The public
has indicated in surveys that rates should be based on
how you drive, and we agree with that."
cities studied in the survey are Baltimore; Tampa, Fla.;
Louisville, Ky.; Chicago; Minneapolis; Houston; Denver;
Oakland, Calif.; Portland, Ore.; and Phoenix.
research used quotes from the websites of the auto
insurers for the minimum liability insurance required by
states. For each quote in the 10 cities, all car driver
and insurance characteristics were held constant except
for marital status.
to Ronald Ruman, press secretary for the Pennsylvania
Insurance Department, the issue of whether a driver is
married or single is a valid statistical pricing method
because studies show married drivers are a lower risk.
he said, Insurance Commissioner Teresa Miller has taken
steps to protect widows and widowers from being unfairly
charged higher rates.
the Insurance Department finds that widows and widowers
are rated using the higher single driver rate, we ask
the insurance company to support its rating of widows
and widowers in this manner," Ruman said. "If
the insurance company is unable to do so, we will ask
the company to amend its filing so widows and widowers
are rated using the lower married driver rates."
in 1968 to advance consumer interests through research,
advocacy and education, the Consumer Federation of
America represents about 300 consumer groups across the
organization is calling for state insurance departments
to investigate the issue. It will share the findings of
the study with all state insurance departments and with
the Federal Insurance Office, which is considering the
issue of insurance affordability.
‘widow penalty’ and other pricing related to marital
status provides still another reason for state insurance
departments to examine insurer pricing more
carefully," Hunter said.