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Is lawmaker blocking bills to stop gender discrimination by auto insurers?

Posted: 7:32 PM, Sep 07, 2018
Updated: 2018-09-07 19:32:22-04

A 7 Action News investigation exposed how some insurance companies are charging women and widows higher rates. Now women are reacting, saying they are tired of being discriminated against.

7 Action News is asking lawmakers why they aren’t stopping discrimination.

When WXYZ requested quotes from Progressive and  Esurance we found by changing only the gender on the application, the cost for women was 18% higher and 28% higher respectively.

Both companies responded by saying they are following the law. Ironically on Esurance's website , it talks about how statistically women are safer drivers and often experience lower rates. 

Esurance defended its actions by sending us a statement released last year by Representative Lana Theis of Howell. She criticized a group that accused Esurance of the practice of using gender in determining prices.

Then WXYZ heard her name again.

Rep. Sherry Gay-Dagnogo (D-Detroit) says she has a bi-partisan sponsored bill that would ban the practice of using factors such as gender, marital status, race, and credit score to determine auto insurance rates. 

She says the bill is being blocked from consideration by the Chair of the Insurance Committee - Rep Lana Theis (R-Howell)

“Unfortunately we have an Insurance Chair that just happens to be a woman, who just happened to be married to a husband that just happens to have a fund that is getting money from the insurance industry,” said Rep. Gay-Dagnogo.

When WXYZ took a look at campaign finance records, we found Rep. Theis received thousands of dollars from insurance companies, including Allstate, which owns Esurance.

The non-partisan Michigan Campaign Finance Network reported her husband started a fund that received  $80,000 from the Michigan Insurance Coalition in 2016.

Then, according to IRS filings, the fund paid a company Theis’ Chief of Staff Meghan Reckling organized more than $68,000.

“Because of the games of politics, because of the big money, the super lobbyists who are funding these campaigns: This is why we cannot get our bills heard in that committee,” said Rep. Gay-Dagnogo.

So what does Representative Theis have to say?

She refused to do an interview with WXYZ, but her chief of staff did provide a statement. 

The statement did not explain why she is not using legislation to stop gender discrimination and discrimination based on marital status, which the state’s insurance commissioner’s office says lawmakers could easily do. 

She instead focused solely on no-fault.

Kim, your story misses the fundamental point: Insurance companies across the country use multiple rating factors to assess risk and they do this in every state. The key difference between other states and Michigan is drivers here are forced to purchase unlimited, lifetime medical benefits with their auto insurance. This costly mandate has caused premiums to skyrocket to the highest in the country. To truly drive down the cost of auto insurance, we must reform the broken, outdated auto no-fault system to reduce fraud and abuse, stop hospitals from charging three or four times more for the same medical procedures and give consumers a choice in their level of medical coverage like they have in every other state.

About the donation, this is a complete mischaracterization by big hospitals and greedy trial attorneys who will do anything to protect the status quo. I never received one penny from that fund and furthermore, I have held auto insurance companies accountable by sponsoring legislation that forced them to reduce rates by as much as 40 percent. No other reforms guaranteed savings for Michigan drivers, who are saddled with paying the highest auto insurance premiums in the country because of our state’s broken, outdated auto no-fault system.

Fact checking what she says, the fact is insurance companies are not allowed to do what they are doing in Michigan in every state.

Hawaii, North Carolina, Montana, and Massachusetts are just a few states where insurance companies are banned from considering gender and marital status as they set rates.

Widows impacted by such policies ask why this discrimination cannot be stopped independently of the no-fault debate.