Should education, job dictate insurance rates?

Should your job or education level dictate how much you pay for car insurance? The Consumer Watchdog group is petitioning to get that practice stopped.

Auto insurance companies offer drivers all sorts of discounts : good driver, multiple vehicle, good student, to cite a few examples.

In a Wednesday news conference, the Consumer Watchdog group said insurance companies such as Allstate are offering another discount that is wrong and illegal under California's Proposition 103.

" Over the last few years, the staff at the state Department of Insurance have been informally approving insurance companies who have been proposing what they kind of sneakily call 'affinity groups, ' " said Harvey Rosenfield, CEO of Consumer Watchdog.

Consumer Watchdog says those affinity groups consist of doctors, lawyers, graduates of prestigious colleges and others ; and that those members get a discount, while others not in a group end up paying a surcharge.

" It turns out it's middle-income and low-income people who don't have fancy jobs or didn't get a fancy education who end up subsidizing the rich folks, " said Rosenfield.

But the Insurance Information Network of California says Prop. 103 indeed allows discounts to groups, and pointed out an excerpt from the Prop. 103 code.

" It doesn't say anything about having to come before the board, " said Pete Moraga, a spokesman for the Insurance Information Network of California. " It just says 'Any insurer may issue any insurance coverage on a group plan without restriction as to the purpose of the group, occupation or type of group. ' "

Consumer Watchdog would like the insurance commissioner to be on board with this, and filed a petition for him to take action.

In a call made to the commissioner's office, I was told he would consider it.

But in the meantime, a statement from his office's spokesperson said : " After a public hearing in which Consumer Watchdog was given the opportunity to present its arguments to an administrative law judge, the judge upheld the settlement allowing Allstate to have separate rates for affinity groups and found that the settlement was fundamentally fair, adequate, and reasonable. "

Consumer Watchdog says the insurance commissioner will have 30 days in which to respond to their petition. If he rejects or refuses it, then Consumer Watchdog plans to sue under Prop. 103.

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Basics To Know And Review About Your Insurance Policy

Type Of Policy

Is it health insurance, life insurance, long term care insurance, disability insurance, property and casualty insurance, or auto insurance? If you are reviewing or summarizing a life insurance policy, specify what type of life insurance policy it is : term life, whole life, universal life or variable life.

Insurance Carrier

Who is the insurance company that provides the insurance? Keep track of a customer service number you can call, or the contact information for your insurance agent.

Policy Number

You will always need your policy number when you call and ask questions about an insurance policy.

Date Issued

It is important to know the date the insurance was issued especially when it comes to life insurance, as term insurance has an expiration date, and permanent insurance will have a surrender charge that may apply if you cancel the policy in the first five to twenty years.

Premium Required

Always keep track of the premium you pay and how frequently it is paid. In the case of a whole life insurance policy, the policy could be paid up. In that case if you were creating a policy summary you would write " No premiums required at this time as premiums are being paid by the dividends inside the policy. " For other types of insurance, you might list something like “Premium of $225 per month paid by automatic deduction form checking account. ”

Insured

Who do the benefits apply to ; you, your spouse, a dependent child?

Once you understand the basic components, you can review the details of the insurance policy.

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