ALBANY, N.Y. (NEWS10) – This week is the first that the public has had a chance to weigh in on a change that could affect how much you pay for car insurance.
Governor Andrew Cuomo announced last week insurance companies can no longer base initial rates off your education level or occupation as some do under current law.
Believe it or not, where you work or the type of degree you have could be affecting how much you pay to be on the road.
The New York Insurance Association says it’s mathematically proven someone’s education background is tied to risk, which is why the state allows the industry to use it when setting rates.
“What we’ve learned in the past is that it’s really not hard data, it’s anecdotal information that really lends itself toward discrimination rather than a reasoned judgment,” Assemblyman Kevin Cahill, Insurance Chair, said.
The Assembly’s insurance chair agrees with the governor that companies should not be able to use your education or job to automatically put you in a class that makes you pay more.
“We’d like to see the hard data, one of the things we’re going to be doing in the near future is holding a hearing on rates and limits of auto insurance and have insurance companies give us that hard data, if it exists,” Cahill said.
Once the 45 day comment period is finished in a month or so, insurance companies will have to prove to the department of financial services that a higher initial rate does not violate the law before they can issue one, but the insurance chair says that still doesn’t go far enough.”
“There is a problem in doing it by regulation instead of a statute, in that it could be changed by a future administration.”
As a result, Cahill supports a bill by his colleague Crystal Peoples-Stokes that would stop add examples of discrimination by insurance companies should they decide to charge higher rates.