Poor people really pay more for everything. Be it food, taxes, cashing-checks, or even car insurance.
(PRWEB) March 01, 2012
Online insurance quote provider 4AutoInsuranceQuote.com released a new study highlighting the correlation between income earned and the amount paid for auto insurance. The study, released on Tuesday, shows that on average, low-income individuals will pay much more than wealthy individuals for the same auto insurance coverage. When it comes to annual insurance costs, they say, poor people will pay over $1000 more than people in the middle-class and above.
4AutoInsuranceQuote.com says that many factors, including age, gender, marital status, where one lives, driving history, car make and model, and credit score are all things that are well-known to have an effect on your insurance costs. It is becoming apparent, however, that how much money one makes also plays a huge role in determining how much money one will pay for insurance.
Although insurance companies cannot use factors such as income or race when it comes to determining premiums, the study says, insurance companies find ways to work around this. For example the study claims, that poor people usually have lower levels of education, therefore, insurance companies will charge higher premiums to those without a high school degree. Insurance companies also tend to charge higher rates to those who live in areas with high African-American populations. It is illegal for insurance companies to use race as a factor, so the insurers claim that these people live in areas with high crime, and therefore, it is “riskier” to insure them.
“It's quite unfortunate,” 4AutoInsuranceQuote.com CEO James Shaffer says. “poor people really pay more for everything. Be it food, taxes, cashing-checks, or even car insurance, they definitely take financial-hits that the middle-class and the wealthy do not have to worry about. Not only is it unfortunate, it's unfair. It's even borderline illegal.”
The act of discriminating when determining whether or not to insure an individual is known as “redlining.” Redlining, a form of discrimination, usually refers to refusing insurance coverage to an individual based on where they live. This practice is illegal in the United States. 4AutoInsuranceQuote.com says that while insurance companies will never directly refuse to cover poor people, they will, however, charge them outrageous prices that low-income individuals simply cannot afford. This, they say, is “pretty much the same thing as refusing coverage.”
“The insurance companies try to claim that it only is a strange coincidence that poor people pay more for auto insurance,” Mr. Shaffer says, “but I don't think it is a coincidence at all. If one looks at all the factors they put into play: credit score, education level, geographic location, the car you drive, etc., it's almost as if they are zeroing-in on people who don't make a lot of money. Regardless, the fact remains that if you are poor, you will probably pay more for auto insurance.”
Offering free auto insurance quotes for users in the United States, 4AutoInsuranceQuote.com also releases reports and studies on the auto insurance industry. Recent reports released by them include “Women Are Bad Drivers – Fact or Fiction?”, “Do The Disabled Pay More For Car Insurance?”, and “Drunk Driving vs. Alcohol-Related Traffic Deaths in U.S. Cities.” In addition to these studies, 4AutoInsuranceQuote.com has free tools and resources that help its users find the lowest possibly auto insurance prices.
4AutoInsuranceQuote.com is an insurance quote provider located in Manhattan, New York. Operating since mid-2008, 4AutoInsuranceQuote.com's goal is to become the top source for car insurance quotes in the United States of America.