(The Center Square) – Illinois is one of only two states in the country that does not scrutinize rate hikes by car insurance companies, but that soon may change.
There is legislation moving through the Illinois Capitol that would require auto insurance companies to undergo the same rate hike oversight that utility companies are subjected to.
Abe Scarr, Illinois director for the Public Interest Research Group (PIRG), said Illinois is almost completely unique in that the state requires all drivers to purchase insurance but does very little to protect drivers from unfair and excessive rate hikes.
“Just with State Farm in the last year-and-a-half, almost $750 million in rate increases affecting over 3 million Illinoisans,” said Abe Scarr, Illinois director for the Public Interest Research Group (PIRG).
State Farm did not respond to a request for comment.
The measure would empower the Illinois Department of Insurance to reject or modify excessive rate hikes and end the use of non-driving factors, such as credit scores, to set rates. A coalition of 15 consumer, community and civil rights organizations is backing the legislation.
“Yet again, insurance companies raise rates on families who are struggling to get by, all while lavishing its CEO with exorbitant compensation,” said Rep. Will Guzzardi, D-Chicago, the bill’s sponsor. “We need accountability for these rate hikes, and we need strong rules to protect consumers from predatory, discriminatory, and unnecessary rate increases.”
The measure also would ban discriminatory pricing using non-driving factors like a person’s occupation, credit score or zip code.
Kevin Martin, executive director of the Illinois Insurance Association, said if passed, the legislation will do the exact opposite of what it is designed to do.
“I think if this bill is passed and signed into law, Illinois will go from probably the premiere state for