Tuesday, February 23, 2021
On February 18, 2021, California Insurance Commissioner Ricardo Lara announced a revision to proposed regulations regarding the use of affinity groups in insurance rating. The commissioner will hold a virtual workshop on the revised draft on March 23, 2021, at 1:00 pm PDT to give stakeholders another opportunity to comment on the proposal. The commissioner explained that the purpose of the regulations is to require insurers to give greater access to auto insurance discounts for low-income drivers and people of color.
IN DEPTH
The proposed regulations apply primarily to private passenger automobile insurance. They would permit insurers to use group membership as an optional rating factor subject to limitations, including requirements for relativities and creditability of data. They also require insurers to apply the non-group rate to a driver if that rate is lower than the group rate.