Slog - The Stranger's Blog

Line Out

The Music Blog

« Three-peat: Burner Outraises R... | James Turrell at the Seattle A... »

Friday, September 8, 2006

Did McGavick push discrimination at Safeco?

Posted by on September 8 at 9:49 AM

An article in today’s Seattle Times details the Washington Democrat’s attempt to obtain the release of information gathered in 2003 by the Insurance Commissioner’s office, which Dems hope will reveal that Safeco is the unnamed company in that report which used discriminatory credit scoring policies to cancel some peoples’ auto insurance.

Cantwell-challenger Mike McGavick was CEO of Safeco from 2001-2005 and pushed for credit scoring. However, many say the practice discriminates against so-called high-risk groups like divorced moms, minorities, and poor people by charging them higher rates or, in the case of the “unnamed company,” slashing their coverage altogether.

The Washington State legislature banned insurers from using credit scoring to cancel insurance policies in 2002, a year after Safeco stopped using the practice to cancel policies.

Today our esteemed news editor Josh Feit is down in Olympia, waiting through the hearing to see if the information will be released. We’ll update about this as soon as more news breaks.


CommentsRSS icon

Did this practice by any chance discriminate against drivers with DUIs in Maryland, say? Or drivers who freely admit that they continue to drink and drive today, as long as they're only blowing 0.05?

"The Washington State legislature banned insurers from using credit scoring to cancel insurance policies in 2002, a year after Safeco stopped using the practice to cancel policies."

Okay... so Safeco voluntarily stopped this practice a year before they were required to by law (probably at a loss to its shareholder)?

What evil bastards!

Credit scores are a valid way to rate insurance. If they weren't, the Office of the Insurance Commissioner wouldn't allow companies to do it. The fact is, people with poor credit have higher loss ratios, just like people who with three accidents in the past are more likely to have one in the future. Canceling them outright is just bastardly, but charging more makes sense.

Comments Closed

In order to combat spam, we are no longer accepting comments on this post (or any post more than 45 days old).