Poverty Solutions staffer Joshua Rivera (MPP ’17) testified on May 1 before the U.S. House Financial Services Committee’s Oversight and Investigations Subcommittee.
The hearing, titled “Examining Discrimination in the Automobile Loan and Insurance Industries,” brought together experts to discuss how auto-related expenses vary among socioeconomic groups.
Rivera, senior data and policy advisor for Poverty Solutions’ Detroit Partnership on Economic Mobility, explained how certain auto insurance rate-setting practices have a disproportionate impact on low-income and minority drivers.
Rivera contributed to Poverty Solutions research that found auto insurance premiums were unaffordable in 97% of Michigan ZIP codes. Detroiters faced the most expensive auto insurance costs in the country, with an average annual premium of $5,414.
“These costs make it harder for people to move up the economic ladder, especially for low-income families locked out of the auto insurance market by a lack of affordable coverage options,” Rivera said in his testimony.
He called on Congress to prohibit auto insurers from using non-driving factors — like credit scores, gender, educational attainment, and home ownership status — to set premiums.
Watch video of the full hearing.