Girls And Auto Insurance: Overcharged?

In the United States, auto insurance rates differ between men and women. Men are generally considered to be riskier drivers and are therefore charged more for their insurance, especially during their teenage years and early adulthood. However, this varies by state, and some states have banned the use of gender as a factor in determining insurance rates. On average, men pay around $720 per year for auto insurance, while women pay approximately $740. The cost difference is most significant when comparing teenage male and female drivers, with young men paying substantially more than their female counterparts. As drivers get older, the gender gap in insurance rates tends to narrow, and by age 25, rates are often similar for both genders. However, women may experience a slight increase in their insurance rates by the time they reach their mid-30s. It is worth noting that insurance rates are influenced by various factors beyond gender, including age, driving record, location, and the insurance company's rating formulas.

Male drivers are statistically more likely to be involved in accidents and DUI

Men are statistically more likely to be involved in accidents and DUIs than women. Male drivers, especially those in their teens and early twenties, are more likely to be involved in fatal car accidents. They are also more likely to drive under the influence of alcohol and engage in risky driving practices, such as speeding and not wearing seat belts. According to the National Highway Traffic Safety Administration (NHTSA), men are about four times more likely to be involved in drunk driving crashes than women.

There are several reasons why men are more likely to engage in risky driving behaviours. Firstly, men typically drive more miles than women, increasing their exposure to potential accidents. Secondly, men are more likely to consume alcohol before driving, which impairs their judgment, coordination, and reaction time, leading to a higher risk of accidents. Additionally, alcohol affects men and women differently due to biological factors. Women tend to have a higher proportion of body fat, which dilutes the alcohol in their system, while men have a higher percentage of body water, causing alcohol to accumulate in their bloodstream.

The higher accident and DUI rates among men result in higher insurance costs. Insurance companies consider males, especially young males, to be high-risk drivers. As a result, male drivers are often charged higher premiums to account for the increased likelihood of filing claims. However, it's important to note that other factors, such as age, location, insurance provider, and driving record, also play a significant role in determining insurance rates.

While gender is a factor in most states, some states have banned the use of gender as a determining factor in setting insurance rates. These states include California, Hawaii, Massachusetts, Michigan, Montana, North Carolina, and Pennsylvania. In these states, insurance companies must rely on other factors, such as age, driving record, and vehicle type, to set their rates.

Men pay more for auto insurance in most states

In states that do consider gender when setting insurance rates, men pay more because they are considered to be higher-risk drivers. Male drivers are statistically more likely to get into accidents, get tickets, and be arrested for driving under the influence. They are also more likely to drive a car that is more costly to insure. As a result, insurance companies charge them higher premiums.

The difference in insurance rates between men and women is most significant during the teen and young adult years. During these years, men pay significantly more for car insurance than women. As drivers age, the gender difference in insurance rates decreases, and by age 30, rates are roughly the same for men and women.

It's important to note that insurance rates are based on various factors besides gender, including age, location, insurance provider, driving record, and credit history. These factors can also significantly impact the cost of insurance.

While men pay more for auto insurance in most states, the specific rates and differences can vary across different companies and locations.

Women pay more for auto insurance in some states

In the United States, auto insurance rates are generally higher for men than for women, as men are considered to be riskier drivers. However, this varies by state, and in some states, women are charged more for auto insurance than men.

A study by The Zebra found that in 25 states, women pay more for car insurance than men, with the number of states doubling in just two years. Nationally, women's average annual car insurance premiums were about $10 higher than men's in 2018. This is a significant increase from 2016, when men paid about $1 more than women on average, nationally. The study also found that the cost disparity in many of these states is growing. For example, in Nevada, women paid $14 more than men for car insurance in 2016, but by 2018, the difference jumped to $121.

The reason for this disparity is not entirely clear. One possible explanation is that insurance companies are finding that women are riskier to insure, as they are filing more expensive claims. However, this contradicts data from the IIHS, which suggests that men are more likely to engage in risky driving practices and are involved in more fatal crashes.

It is important to note that not all states allow insurers to use gender as a factor in setting rates. Six states, including California, Hawaii, Massachusetts, Michigan, North Carolina, and Pennsylvania, have banned the use of gender in car insurance pricing. In these states, insurers must use other factors, such as age, driving experience, and claims history, to set their rates.

The issue of gender-based pricing in auto insurance has become increasingly controversial, with consumer advocates arguing that the varying rates are unfair and that men and women should pay the same. In response, some insurance companies have started to eliminate gender as a rating factor, recognizing that it may not be strongly correlated with the likelihood of filing a claim.

Gender-based pricing is banned in some states

In the United States, nearly all states allow insurers to set auto insurance rates based on gender. However, some states have banned the practice of setting insurance rates based on gender. These states include California, Hawaii, Massachusetts, Michigan, Montana, North Carolina, and Pennsylvania. Montana was the first state to ban gender-based insurance rates in 1985, but it reversed this decision in 2021.

In states that allow gender to be a factor in determining rates, men pay more for auto insurance than women. This is because men are considered higher-risk drivers and are more likely to get into accidents, receive tickets, and be arrested for driving under the influence. The difference in rates can be significant, with men paying up to 10% more than women in some states.

However, in states that have banned the use of gender in setting insurance rates, the gender-based advantage for women disappears. In these states, men may even pay less for auto insurance than women, especially at older ages. For example, in Montana, women may pay up to 30% more for auto insurance than in states that consider gender.

The move toward gender-neutral insurance rates is driven by equality and nondiscrimination experts who argue that ratings should only be based on factors within a consumer's control, such as occupation, driving behaviour, and miles driven, rather than gender or other protected classes like race and religion.

Women are charged more for the same coverage

While men are generally considered to be riskier drivers and are charged more for auto insurance, women are charged more for the same coverage in several states. In fact, in just two years, the number of states where women pay more than men has doubled.

Women Pay More Than Men For Car Insurance in Several States

A study by The Zebra found that women pay more for car insurance in 25 states, an amount that has doubled since 2016. In 2018, women's average annual car insurance premiums were about $10 higher than men's. This is in contrast to 2016, when men paid about $1 more than women, on average, nationally.

Men Are Riskier Drivers

Despite this, studies show that men exhibit riskier driving behavior and are more likely to be involved in fatal crashes. Men accounted for 71% of driver fatalities in crashes in 2017, according to the IIHS. They are also more likely to drive without a seatbelt, drive while impaired by alcohol, and speed.

Gender-Based Pricing

Gender-based pricing has been accepted by government regulators because insurers have been able to show that male teen drivers are statistically more likely to crash and file claims than female teens. However, this rationale has been questioned as the price differences between men and women vary widely from location to location and insurer to insurer.

Consumer Concerns

Consumer advocates have argued that if gender were strongly tied to the likelihood of filing a claim, there would be more consistency across insurers and locations. They say that wildly varying rates are unfair and that men and women should pay the same.

Factors Other Than Gender

It's important to note that gender is just one factor that auto insurance companies use to determine rates. Other factors include age, location, insurance provider, driving record, and the type of car driven.

Frequently asked questions