US regulators ask insurers for price data
WASHINGTON (Reuters) - US regulators have ordered nine insurance companies, including Allstate Corp and Travelers Cos Inc, to provide information about how they set prices for homeowners' coverage, the Federal Trade Commission said yesterday.
The FTC said the companies must provide data about credit-based insurance scores, essentially the equivalent of a credit rating but one that focuses on how much particular consumers cost their insurance companies.
The US Congress asked the FTC to look at the use of credit-based insurance scores in 2003. An FTC study on automobile insurance released in 2007 found that the scores allowed insurance companies to determine who was likely to be high risk and to subsequently charge those people more.
The study found that African-Americans and Hispanics tended to have lower insurance scores than Whites and Asians and, because of this they tended to pay more for auto insurance.