Posted On: January 2, 2007, 4:50 pm CST

Posted By: NTXCoog

Public policy determines whether race based underwriting/rating can be used if it was statiscally valid. Gender based rating is generally considered statiscally valid, but some states don't allow it. Age based rating is generally considered statiscally valid, but some states don't allow it (allowing similar years driving experience).

Credit based rating is generally considered statiscally valid by those who have looked at the numbers, but society and public policy must decide whether that is a factor that can be used.

And for those who say that having bad credit doesn't mean that they're a better driver, there are a ton of rating variables that have nothing to do with driving... homeownership, paying the premium in full, having prior insurance, quoting the new business more than x days in advance, being a good student, et al, but all of those have discounts related to them that are statiscally supported.

Technically even the car you drive may not indicate what kind of driver I am. If I drive a Ford Taurus, am I a safer driver than if I drive a Corvette? No one knows, but even without looking at the statistics do you assume that a Corvette driver and a Taurus driver have the same driving habits? They may, but statistics for the general population would reflect otherwise. Should I charge the same liability rate for both vehicles? In the past, many companies did.