Maryland Consumers Lose as Legislature Defeats Effort to Stop Redlining in Car Insurance

The Consumer Federation of America (CFA) condemns the Maryland House Economic Matters Committee for voting against sensible and urgently needed bills that would reform the way auto insurance is priced in Maryland. According to CFA, Black customers face disproportionately higher premiums in the Maryland insurance market, even for drivers with perfect driving records. Lawmakers introduced two possible reforms to reduce unfair discrimination in auto insurance markets — to reduce pricing by ZIP code (HB 1251 — Del. Alonzo Washington) and to end the use of consumer credit history for determining premiums (HB 221 — Del. Veronica Turner). On Monday, the Committee gutted the credit scoring bill and rejected the territorial pricing reform.

“Maryland consumers should be very disappointed in this Committee, which stood with the insurance lobbyists at the expense of safe drivers, and at a particularly high cost for people of color who feel the brunt of unfair pricing in the market,” said Douglas Heller, CFA’s Insurance Expert. “Every driver in Maryland is required by state law to purchase auto insurance, so state lawmakers need to do a better job of preventing discriminatory pricing in the market, and this week they failed.”

CFA noted that the Committee’s dismantling of the credit scoring prohibition on Monday took the form of an amendment offered by Del. Davis that gutted the bill and replaced it with a toothless industry strategy used to ward off…