Car insurance costs for women and seniors in Illinois could rise

Car insurance rates are rising in Illinois and across the country. Factors such as the cost of auto parts, labor costs, accident rates and car thefts all contribute to this increase.

But if you think you're feeling the pressure now, the costs will rise even further if the Illinois Legislature passes House Bill 4611, particularly for seniors and women.

HB4611 prohibits the use of credit information and gender in determining automobile insurance premiums. A recent analysis by a leading national insurer found that more than half of Illinoisans could receive an average premium increase of $294 if credit information and gender were banned. Equally concerning, 62% of seniors (65+) could see an average premium increase of $287.

By using credit information in insurance pricing, consumers can save 30 to 59% on their car insurance. The ban on the use of insurance credit scores in other states has resulted in a significant increase for policyholders. For example, the use of credit was banned in Washington in 2021, and more than 60% of drivers in Washington saw their premiums increase.

A gender ban could have the unintended consequence of increasing rates for female drivers. Statistics show that men tend to have more accidents and therefore generally pay higher rates. If gender is banned, female drivers will pay more for their car insurance.

Conclusion: Using credit scores and gender in insurance pricing helps insurers identify consumers who are less likely to file a claim and therefore benefit from a discount or other savings. HB4611 would eliminate these benefits at a time when people can least afford them. Lawmakers can protect the best interests of Illinoisans, particularly women and seniors living on fixed incomes, by considering the consequences of removing rating factors that save people money on car insurance .

Lynne McChristian is director of the Office of Risk Management & Insurance Research at the University of Illinois, Urbana-Champaign

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