Widows and divorcees charged more for auto insurance

  • New research shows that most major auto insurers vary prices considerably depending on marital status
  • Higher rates for widows than for married women, and other marital price differences
  • Raises questions about the fairness of auto insurer pricing

Washington, DC – The Consumer Federation of America (CFA) has released research on how insurers utilize marital status in their pricing of auto insurance policies.

The CFA has questioned the fairness and relation to risk of this pricing by most major insurers, particularly their practice of hiking rates on women whose husbands die.

In the ten cities studied, four of six major insurers – GEICO, Farmers, Progressive, and Liberty – increased rates on state-mandated liability coverage for widows by an average of 20 percent. The fifth insurer, Nationwide, sometimes increased rates for widows. The sixth insurer, State Farm, did not vary the rates it charged because of marital status. All State Farm price quotes for a driver in a city were the same, regardless of whether the driver was single, separated, divorced, widowed, a domestic partner, or married.

“Hiking rates on women whose husbands die seems both unfair and inhumane,” said Stephen Brobeck, CFA’s Executive Director. “Why don’t insurers instead emphasize driving-related factors such as accidents, traffic violations, and miles driven in their pricing?”

An earlier national survey of a representative sample of adult Americans, commissioned by CFA, found overwhelming consumer support for insurer emphasis on these driving-related factors in their auto insurance pricing.

The CFA research, undertaken by Brobeck and Michelle Styczynski, utilized quotes from the websites of the auto insurers for the minimum liability insurance required by states. For each quote in the ten cities, all car, driver, and insurance characteristics were held constant except for marital status.

Farmers, Progressive, Nationwide, and Liberty always charged single, separated, and divorced drivers the same price, and this annual premium was almost always higher than the premium it charged married persons.