Credit Scoring in Montana — Marriage Auto Insurance Discounts are Legal

A credit scoring controversy in Montana.

Montana law has a married couple deemed to be a better insurance risk than those that are unmarried. It all goes back to a law passed by the Montana Legislature in 2021 giving an auto insurance price break to married couples.

A lawsuit was filed saying the law violates Montana’s constitution with one plaintiff claiming they pay 6.2% more per year for insurance than unmarried people.

The 2021 law came out of H.B. 379. It overturned a law passed in 1985 that said insurers could not discriminate against single people and favor married couples.

A district court judge ruled last week that the 2021 law is perfectly legal and does not contain constitutional violations. He noted the Montana Constitution bars discrimination based on race, sex and religion but marriage is not one of them, therefore, the 2021 law is legal.

“Simply because a statute discriminates on the basis of marital status does not mean the statute is irrational,” he wrote.

Insurers, and other supporters, say actuarial data shows married drivers do not submit as many claims as single people. An executive from an insurance company testified that insurers in 42 states have similar laws on the books and many — like the District of Columbia — offer discounts to married drivers.

As a side note, the PIA Western Alliance opposes bans on credit scoring. A few years ago in Washington State, the PIA Washington filed a lawsuit when then Insurance Commissioner Mike Kreidler usurped state law and put credit scoring bans of his own in place.

The PIA Washington and its supporters won the case.

Source link: Business Insurance — https://bit.ly/4lFaROw