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There is legislation
moving through the Illinois Capitol that would require auto
insurance companies to undergo the same rate hike oversight that
utility companies are subjected to.
Abe Scarr, Illinois director for the Public Interest Research
Group (PIRG), said Illinois is almost completely unique in that
the state requires all drivers to purchase insurance but does
very little to protect drivers from unfair and excessive rate
hikes.
“Just with State Farm in the last
year-and-a-half, almost $750 million in rate increases affecting
over 3 million Illinoisans,” said Abe Scarr, Illinois director
for the Public Interest Research Group (PIRG).
State Farm did not respond to a request for comment.
The measure would empower the Illinois Department of Insurance
to reject or modify excessive rate hikes and end the use of
non-driving factors, such as credit scores, to set rates. A
coalition of 15 consumer, community and civil rights
organizations is backing the legislation.
“Yet again, insurance companies raise rates on families who are
struggling to get by, all while lavishing its CEO with
exorbitant compensation,” said Rep. Will Guzzardi, D-Chicago,
the bill’s sponsor. “We need accountability for these rate
hikes, and we need strong rules to protect consumers from
predatory, discriminatory, and unnecessary rate increases.”
The measure also would ban discriminatory pricing using
non-driving factors like a person’s occupation, credit score or
zip code.
Kevin Martin, executive director of the Illinois Insurance
Association, said if passed, the legislation will do the exact
opposite of what it is designed to do.
“I think if this bill is passed and signed into law, Illinois
will go from probably the premiere state for insurance companies
to want to do business to by far the worst,” said Martin.
Kevin Bessler reports on statewide issues in
Illinois for the Center Square. He has over 30 years of
experience in radio news reporting throughout the Midwest.
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