Insurance and Discrimination
Discussion
This came as a huge surprise to me, so I wanted to share and see what others think about the issue.
Given that insurance premiums have been skyrocketing in the past few years, I decided to take a look at insurance quotes for the various cars that I'm considering (650i, 335i or M3) - I was left in a complete shock. I was getting quotes of about £6-7k on a £20k car which seemed a bit out of hand to me.
So I spoke to a friend of mine and he got a quote of £2.5k (from Admiral) for a 650i - I think this quote is very reasonable, if not cheap given my circumstances (23yr old, 1.5yrs as named driver and I passed my test in Sept 2007). So we tried to narrow down the culprit - turns out, it was because I wasn't a resident of the UK since birth.
I know that insurance is all statistics and such when it comes to classifying people but this seemed ridiculous to everyone who I've talked to.
Given that insurance premiums have been skyrocketing in the past few years, I decided to take a look at insurance quotes for the various cars that I'm considering (650i, 335i or M3) - I was left in a complete shock. I was getting quotes of about £6-7k on a £20k car which seemed a bit out of hand to me.
So I spoke to a friend of mine and he got a quote of £2.5k (from Admiral) for a 650i - I think this quote is very reasonable, if not cheap given my circumstances (23yr old, 1.5yrs as named driver and I passed my test in Sept 2007). So we tried to narrow down the culprit - turns out, it was because I wasn't a resident of the UK since birth.
I know that insurance is all statistics and such when it comes to classifying people but this seemed ridiculous to everyone who I've talked to.
sorry bud, not meaning to be racist here at all, but the vast vast majority of whiplash claims in my past of the country (west yorkshire) are caused by Pakistani descent and polish people.
The insurance industry has to look at certain statistics, and when something is this obvious, it has to be a fairly major criteria for them.
The insurance industry has to look at certain statistics, and when something is this obvious, it has to be a fairly major criteria for them.
c3m said:
This came as a huge surprise to me, so I wanted to share and see what others think about the issue.
Given that insurance premiums have been skyrocketing in the past few years, I decided to take a look at insurance quotes for the various cars that I'm considering (650i, 335i or M3) - I was left in a complete shock. I was getting quotes of about £6-7k on a £20k car which seemed a bit out of hand to me.
So I spoke to a friend of mine and he got a quote of £2.5k (from Admiral) for a 650i - I think this quote is very reasonable, if not cheap given my circumstances (23yr old, 1.5yrs as named driver and I passed my test in Sept 2007). So we tried to narrow down the culprit - turns out, it was because I wasn't a resident of the UK since birth.
I know that insurance is all statistics and such when it comes to classifying people but this seemed ridiculous to everyone who I've talked to.
to be fair you have no claims, your 23 and having been driving that long.Given that insurance premiums have been skyrocketing in the past few years, I decided to take a look at insurance quotes for the various cars that I'm considering (650i, 335i or M3) - I was left in a complete shock. I was getting quotes of about £6-7k on a £20k car which seemed a bit out of hand to me.
So I spoke to a friend of mine and he got a quote of £2.5k (from Admiral) for a 650i - I think this quote is very reasonable, if not cheap given my circumstances (23yr old, 1.5yrs as named driver and I passed my test in Sept 2007). So we tried to narrow down the culprit - turns out, it was because I wasn't a resident of the UK since birth.
I know that insurance is all statistics and such when it comes to classifying people but this seemed ridiculous to everyone who I've talked to.
insurance has skyrocked lately but given that im surprised they even quoted you on the above cars!
dont think the residence will affect it that much......unless your getting quotes from the BNP or daily mail!
MX7 said:
If it's proven that people who are not a UK resident since birth are a higher liability, where's the problem?
It's putting everyone in the same pool. It's the same as putting all young drivers (whether responsible drivers or not) in a high premium category - unfair but such is life. I guess I just have to suck it up for every other UK resident who hasn't been here from birth.k15tox said:
dont think the residence will affect it that much......unless your getting quotes from the BNP or daily mail!
This is a real quote difference. I just checked the box that says resident since birth (versus 8 yrs). Lowest quote went from £7.1k (Endsleigh) to £2.5k from Admiral.This rating factor was brought up by "which?" magazine last year, admiral confirmed that they never ask for the country of origin only whether they were a UK resident since birth, Admiral presented data showing that persons not resident since birth can be a higher risk, do not ask why I have no idea but the numbers show the truth.
You could be australian, american, asian etc it doesn't matter as that is not the question asked.
You could be australian, american, asian etc it doesn't matter as that is not the question asked.
Efbe said:
sorry bud, not meaning to be racist here at all, but the vast vast majority of whiplash claims in my past of the country (west yorkshire) are caused by Pakistani descent and polish people.
The insurance industry has to look at certain statistics, and when something is this obvious, it has to be a fairly major criteria for them.
I completely understand the situation when looked from the point of view of the insurer. It just feels disproportionally unfair to me. If the difference was, say a couple of hundred, that won't bother me. But £4.6k seems a bit too much.The insurance industry has to look at certain statistics, and when something is this obvious, it has to be a fairly major criteria for them.
c3m said:
I completely understand the situation when looked from the point of view of the insurer. It just feels disproportionally unfair to me. If the difference was, say a couple of hundred, that won't bother me. But £4.6k seems a bit too much.
It's relative, had the premium been alot lower the increase would have been different, it's just that you were getting higher premiums so the percentage load results in a higher increase.ZOLLAR said:
It's relative, had the premium been alot lower the increase would have been different, it's just that you were getting higher premiums so the percentage load results in a higher increase.
Thanks for pointing that out, it could well be the reason for the massive amount increase (184% increase from £2.5k).Poko said:
I wasn't born in the UK either, but it makes no difference to the price of my policy.. A completely different car granted, but the price difference is bizarre!
Comparison sites etc don't ask for a place of birth, so can't see how they would discriminate from a certain country?
You're correct - it's not based on which country you're born in, it's whether you're born in the UK or not that makes the difference.Comparison sites etc don't ask for a place of birth, so can't see how they would discriminate from a certain country?
c3m said:
MX7 said:
If it's proven that people who are not a UK resident since birth are a higher liability, where's the problem?
It's putting everyone in the same pool. It's risk assessment.
ZOLLAR said:
This rating factor was brought up by "which?" magazine last year, admiral confirmed that they never ask for the country of origin only whether they were a UK resident since birth, Admiral presented data showing that persons not resident since birth can be a higher risk, do not ask why I have no idea but the numbers show the truth.
You could be australian, american, asian etc it doesn't matter as that is not the question asked.
Knowing the insurance industry, I'm reluctant to take anything they say as set in stone. Using common sense for a second, how pausible is it that someone who has lived in the UK for 15 years will be a higher risk than someone who has lived in the UK since birth?You could be australian, american, asian etc it doesn't matter as that is not the question asked.
Indeed, if you argue that there is a link between years of residence (above a certain limit) and riskiness, maybe there is a link between how much you weigh and how much of a risk you pose. Can they start asking for your weight too?
Furthermore, as an economist, I know that almost any two factors can be regressed (technique used for explaining if some factor explains a given outcome) to show what you want to show - probably the kind of manipulation that underlies Admiral Group's findings.
MX7 said:
No, it's exactly the opposite. If it was putting everyone in the same pool, they wouldn't take it into account, or age, or previous driving record. How can treating everyone the same be discrimination?
It's risk assessment.
What I meant was putting everyone non-UK born in the same pool. Again, it's a game of averages and that's why the difference ends up being so high (as previously pointed out, it could be because they apply a % increase if you're non-UK born). It's just that in my opinion, a £4.6k increase is not good risk assessment of the fact that I'm not born in the UK.It's risk assessment.
Again, I'm not saying that insurance companies should not do risk assessment and try to find the distinguishing elements between various risk groups.
.blue said:
Furthermore, as an economist, I know that almost any two factors can be regressed (technique used for explaining if some factor explains a given outcome) to show what you want to show - probably the kind of manipulation that underlies Admiral Group's findings.
I think this hits it on the nail - correlation does not imply causation.Gassing Station | General Gassing | Top of Page | What's New | My Stuff