Redlining by Auto Insurers

In response to “Simply Put, Territorial Rating Is Redlining,” Op-Ed Page, Oct. 26:

To suggest that territorial rating is racially discriminatory is simply ludicrous.

Although I believe that territorial rating is actuarially sound, it does not take an actuary to come to this realization! If you live in an area with higher traffic congestion, higher theft rates, etc., your auto insurance rates should be higher than for those persons living in areas with lower accident rates, theft rates, etc.

You don’t need a study by the Stanford Research Institute to figure out that people living in Baker, Calif., with a low population and only one or two stop signs, are less likely to incur a loss than someone living and driving in the Los Angeles metropolitan area. This is simply common sense!

The elimination of territorial rating and the artificially lowering of premiums for Los Angeles would simply have the effect of drying up the availability for insurance for the Los Angeles area residents. Simply put, if the insurance companies feel they are losing money in a given area, they will do everything in their power not to write insurance in that area.

The cost of auto insurance is extremely high, and the situation has simply gotten out of hand. But in order to reduce the cost of auto insurance, you must address the root cause of the problem--and that is, simply, the costs of high claims. While the elimination of territorial rating is politically popular, a more accurate solution to the high cost of automobile insurance would be the installation of a true, no-fault automobile insurance mechanism.

CLARK F. JACKSON

Glendora