US Lawmakers Reintroduce PAID Act to End Auto Insurance Bias Nationwide

In a significant move toward consumer fairness and transparency, U.S. lawmakers have reintroduced the Preventing Auto Insurance Discrimination (PAID) Act. This bill aims to tackle longstanding concerns over discriminatory practices in auto insurance pricing — particularly the use of non-driving factors like ZIP codes, credit scores, and education level in setting premium rates.

What Is the PAID Act?

The PAID Act seeks to ban the use of personal, non-driving-related data in auto insurance underwriting. This includes:

Credit Scores
Marital Status
Education Level
Occupation
Residential ZIP Code

Supporters of the bill argue that premiums should reflect driving history and behavior — not socioeconomic status.

Why the Act Matters

Numerous studies have shown that people in low-income or minority communities often pay hundreds of dollars more per year for auto insurance — even if they have perfect driving records. This practice has disproportionately impacted Black, Latino, and low-income drivers across the country.

📊 Example: A 2023 Consumer Federation study found that drivers with low credit scores paid up to 80% more for the same policy compared to those with high credit scores, despite identical driving records.

What Lawmakers Are Saying

“Your car insurance premium should be based on how you drive — not where you live or how much money you make,”
— Senator Cory Booker, one of the bill’s leading sponsors.

The PAID Act has received bipartisan support and is backed by consumer advocacy groups, civil rights organizations, and economic justice movements.

Industry Pushback

Not surprisingly, many large insurance companies oppose the bill. They argue that these rating factors help better predict risk and set competitive prices. However, critics argue this is a smokescreen to maintain profit margins at the expense of the most vulnerable consumers.

What Happens Next?

The reintroduction of the PAID Act is just the beginning. It will now go through committee hearings and debates before it has a chance of becoming law. In the meantime, consumer advocates are urging the public to:

Call their representatives
Support local and national petitions
Raise awareness on social media

Conclusion

The fight against auto insurance bias is gaining momentum. The PAID Act is a major step toward a fairer system where driving — not discrimination — determines your premium. As the debate heats up, all eyes will be on Congress to see if justice will finally hit the road.