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Group Says GEICO Discriminates In Rate Quotes

Lawmaker wants ban on education, income as considerations

Home News Tribune — Wednesday, February 28, 2007

By TOM BALDWIN
GANNETT STATE BUREAU

TRENTON — Drivers without college degrees or white-collar jobs pay more for car insurance from GEICO, according to a study released by an advocacy group today in advance of debate on a bill that might make that actuarial application illegal.

"They use education and income, occupation, as a proxy for race," said state Sen. Nia Gill, D-Essex, sponsor of the bill that would ban the use of schooling and workplace status in the string of factors insurers use to set rates.

"It's not just a poor-person's issue here," said Gill. "It goes directly to the middle class."

The advocacy group New Jersey Citizen Action said it had gone to the Web site for GEICO, famous for its ads with the animated gecko, and sought rates for 449 phantom drivers where the lone differences were educations and jobs.

The group said quotes differed by from 9 percent to 61 percent.

The group said a 51-year-old professional woman from Camden driving a U.S.-built sedan paid $1,063 if she possessed a doctoral degree, but $1,712 if she had nothing beyond a high-school degree.

GEICO spokeswoman Rynthia Rost stood outside the Statehouse conference room where Citizen Action unveiled the study, and she answered reporters' questions.

"We don't use race and income to set our rates," Rost said, acknowledging the company does use education and jobs because she said they, among other factors, matter in predicting the odds of an accident or other insurance loss.

Copyright 2007 Gannett New Jersey Group

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