In Democrat state Sen. Jay Luneau’s world, ideology is more important than people, to which his sponsorship of SB 81 attests. Why a pair of Republicans would sign onto that is anybody’s guess.
The bill would add the word “gender” to prohibited classification in the setting of vehicle insurance rates in Louisiana, as is the case in only seven others. It’s all that’s left from a string of demagogic bills Luneau kept proposing in past sessions that have tried to circumscribe rate-setting tools for insurers that, in every case, legitimately price risk, which deservedly bit the dust.
As is typical, the argument for this particular attenuation was intellectual mishmash. Luneau presented a single study as proof alleged discrimination occurred against women merely for gender, but then he and Senate Insurance Committee supporters also argued that nobody really knew what goes into pricing – a sentiment also shared by other on the committee against it. In regards to the fact brought out in testimony that most studies showed men nationally paid more and so this change likely would cause the same in Louisiana, Luneau replied that the (tepid) tort reform measures passed (over his objections) three years ago actually saw increases in rates in years following, implying this wouldn’t happen.
In other words, if a piece of evidence fits his worldview, it’s acceptable; if not, it’s questionable. A more rigorously intellectual evaluation of the vast disparity of research conclusions on the question is that the rate-setting calculus is very complex and difficult to do at an individual level, so categorical comparisons very much depend upon the parameters defining the study, such as policy limits, sample of the universe of policies, quotes vs. actual policy issued, etc. But it is telling that the preponderance of evidence, and typically including those most comprehensive in scope, show nationwide men pay more than women, and this is reflected in most studies. If women somewhere on average pay more, it’s because of any of dozens of other reasonable factors running against them override the advantage they have on sex.
That makes perfect theoretical sense, as women overall have fewer accidents and display less risky driving behavior as indicated by frequency of moving violations. More specifically, younger males make up the bulk of that, with records leveling into middle age, and then the disparity returns at advanced ages. All other things equal, the data demonstrate that women in the aggregate are safer drivers than men, and there’s no reason insurance companies shouldn’t have the option of using this data point in their pricing.
But notice as well the absolute intellectual poverty of Luneau’s bald assertion that discrimination by sex is so powerful and pervasive that it must drive rate differences negatively against women, based upon his narrow choice of data to accept. Each year, the rate differential varies, and it varies, sometimes dramatically, by state. So, given the insistence that absolutely and powerfully prejudice against women drives rates, we are to believe that in states where women pay more insurance companies there – firms which perhaps write policies in other states where the opposite is true – decide to practice selective prejudicial discrimination in those places? And in other states they don’t? And some years they do and some years they don’t?
His thinking on this is a supremely incoherent mess. He must think that where men pay higher rates as a whole they must be so incredibly bad drivers as to overcome the alleged natural bias against women he claims inherent to rate-setting – without a shred of proof countering the far more likely explanation is the data reflect a claim history where women are involved in fewer incidents causing less damage that has a significant impact on rates. And his rejection of that bit of common sense must mean he thinks Louisiana men are the worst of the worst.
Because using data from the latest research, guess which state is the one where men pay more than women than in any other? His bill would end up driving the typical female’s rate in Louisiana by at least a couple of hundred dollars while males will catch something of a break.
And the fact that in Louisiana women pay an average $404 less than men may be worse for all consumers if policy writers are forced make gender irrelevant, beyond the point committee chairman GOP state Sen. Kirk Talbot observed that writers don’t care who pays what differentially just as long as they can charge enough to afford to stay in business. Indeed, research demonstrates that this kind of law not only causes women generally to pay higher rates (all other factors equal) than they would otherwise, but also pushes rates higher for everybody.
Regardless, the measure passed but only because two Republicans stupidly voted in favor to allow it to squeak out 5-4. One, state Sen. Louie Bernard, has a horrible record on voting sensibly on insurance matters – so bad, in conjunction with a few other leftist flirtations, that with his reelection chances imperiled by these clunkers he announced he would retire after just one term.
The other cast his favorable vote as part of an expanding tendency to sabotage any political career he might have. Until recently very solid in his political calculations that included consistently voting conservatively, state Sen. Barrow Peacock began to see the wheels come off any chance of extending his shelf life in politics after term limitation this year when he backed, to the chagrin of nearly every Shreveport Republican political activist, leftist Democrat state Sen. Greg Tarver in the city’s mayoral race last year. That completely backfired when conservative Republican Tom Arceneaux upset Tarver.
His vote for the bill especially seemed schizophrenic since in the recent special session he had made a principled argument against $45 million to subsidize insurers to write property policies in the state. Yet on this one he either abandoned principle reasonably related to this past voting behavior or he completely erroneously evaluated the bill’s implications.
Neither commend him to continued service in elected office. It will be interesting to see, if the bill comes to a floor vote as expected, whether he’ll take a step back from going down the path of political self-immolation by changing his vote on it.
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