July 26, 2021

Alex Hart

Senior Insurance Regulatory Policy Analyst

Room 1410 MT

Department of the Treasury

1500 Pennsylvania Ave NW

Washington, DC 20220

Submitted electronically

Re: Consumer and Community Organizations' Response to Federal Insurance Office Request for Information: Monitoring the Availability and Affordability of Auto Insurance: Assessing Potential Evolution of the Auto Insurance Market

Dear Mr. Hart:

The following comments of the undersigned organizations address the Federal Insurance Office (FIO)'s request for information (RFI) concerning the updating of the 2017 FIO Auto Insurance Affordability Study and other research topics and methodologies for FIO to consider regarding auto insurance affordability and availability.

Auto insurance is unique. As the only product that most Americans are required to purchase by law, it is particularly important that auto insurance is available, affordable, and priced fairly in the marketplace. However, the market for auto insurance is, as FIO's 2017 study illustrated, often not affordable to lowand moderate-income Americans and people of color. Even drivers with unblemished driving records may find that the cost of coverage in their community and for people with their socio-economic characteristics far exceeds their family budget. This problem runs headlong into the dual public policy goals of ensuring that all drivers maintain coverage and that the market for coverage is fair and affordable. In these comments we lay out measures that FIO can take to provide more information about the state of the auto insurance market and address inequities such as the one President Biden highlighted at a February 2021 CNN Townhall when he noted that "[i]f you live in a black neighborhood, you're going to pay a higher premium on your car."(1)

The 2017 FIO Auto Insurance Affordability Study provided a first-of-its-kind and useful snapshot of the auto insurance market in some American communities that have been historically underserved by the insurance industry or have otherwise faced barriers to obtaining coverage. While there are other important research projects regarding availability and affordability of personal auto insurance that FIO should undertake, FIO's top priority should be to update the 2017 study for the following reasons:

  1. An update is relevant - FIO can identify changes in affordability compared with the 2017 results using a consistent methodology.

  2. An update is timely - there has been much public discussion of historic and persistent inequities in financial services - and FIO could complete an update this year.

  3. The infrastructure - methodology and data collection process - for updating the study is in place.

  4. An update does not compromise other research by FIO into personal auto insurance issues or the development of a more robust data collection and...

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