In an article with WalletHub regarding the cheapest car insurance in South Carolina for 2021, Professor James Malm addresses whether or not is fair for auto insurance companies to consider factors such as gender, age and occupation when setting premiums.
In setting premiums, auto insurance companies use a risk/pricing framework. Thus, the more risky behavior an individual exhibits, the higher the prospect of a future claim and hence the higher the auto insurance premium. Important determinants of auto insurance premiums include; driving record/behavior, vehicle type, location (state and zip code), traveling patterns, alcohol/drug use, educational status, credit history, seatbelt usage, claim history, among others.
Read the WallHub article to see the answers Professor Malm provided!