Minorities pay more for insurance: report
US consumers with a poor credit history and those belonging to racial minorities pay more for their car insurance, according to a government report.
The Federal Trade Commission (FTC), the US consumer watchdog, has discovered a correlation between credit history and the number of insurance claims a customer lodges.
Insurers say the report vindicates the use of credit history, including credit card debt and bill payments, as an accurate way of determining premiums.
However, consumer groups are concerned the report was compiled using insurance industry data and did not examine whether credit-based premiums discriminated against minority groups.
The FTC report found Hispanics and African-Americans consistently scored worse on credit checks than Asians or Caucasians.
The Federal Trade Commission (FTC), the US consumer watchdog, has discovered a correlation between credit history and the number of insurance claims a customer lodges.
Insurers say the report vindicates the use of credit history, including credit card debt and bill payments, as an accurate way of determining premiums.
However, consumer groups are concerned the report was compiled using insurance industry data and did not examine whether credit-based premiums discriminated against minority groups.
The FTC report found Hispanics and African-Americans consistently scored worse on credit checks than Asians or Caucasians.