Ruiz, Cruz-Perez Bill to Prohibit Insurance Companies from Considering Education, Credit Score When Determining Rates Advances

TRENTON Legislation sponsored by Senator M. Teresa Ruiz and Senator Nilsa Cruz-Perez that would prohibit the use of education, occupation, and credit score as factors in auto insurance rates passed the Senate Commerce Committee today.

“Newark has some of the highest car insurance rates in the country. We cannot allow car insurance companies to continue to prey on New Jersey’s most vulnerable, charging low income customers significantly more,” said Senator Ruiz (D-Essex). “Insurers should be basing their rates off of the likelihood someone will be in an accident, not their ability to pay for those damages out of pocket.”

“It is outrageous that someone with a bad credit score pays more for insurance than someone who has been convicted of a DUI,” said Senator Cruz-Perez (D-Camden/Gloucester). “We cannot continue to let insurers base rates off of credit history or socioeconomic status rather than someone’s driving record.”

The bill, S-2654, would prohibit automobile insurers from assigning an insured or prospective insured person a rating tier based on their education level, credit score, or employment, trade, business, occupation or profession.

The bill would take effect on the 90th day following enactment.

The bill cleared committee today by a vote of 4-0 and next heads to the full Senate for further consideration.