Representatives from seven insurance industry and consumer groups are set to testify Monday at a New Jersey Senate hearing on the controversial topic of whether job status and education should be a factor in setting auto premiums, according to a legislative notice.
The session in Trenton has been scheduled by Sen. Nia H. Gill, D-Montclair, who chairs the Senate Commerce Committee and has introduced legislation to prohibit use of education and job levels to rate driver risks.
The legislation up for discussion was generated after reports that GEICO used jobs and education as the sole basis in fixing eligibility and premiums for auto coverage.
Sen. Gill's announcement of the session said it will examine the underwriting factors and rating systems used by private passenger auto insurers to determine driver eligibility and premiums for insurance coverage.
Her notice said the hearing will include, but not be limited to, information concerning the use of occupation and education to determine driver eligibility and premiums.
Scheduled to testify before the committee are representatives from: the Department of Banking and Insurance, New Jersey United Reciprocal Exchange, New Jersey Citizen Action, Insurance Council of New Jersey, Property Casualty Insurers Association of America, National Association of Mutual Insurance Companies and Government Employees Insurance Company.
GEICO has said the characterization of their underwriting process as relying solely on job and education data is "absolutely untrue."
Vince Matthews, a spokesman for Sen. Gill, said her bill--S.1714--could be scheduled for a vote at the committee's next meeting after the hearing, which should provide "guidance for further action."
He said the bill has Sen. Joseph Vitale, D-Woodbridge and Sen. Joseph Doria, D-Bayonne, as sponsors.
A similar measure has been introduced in the Assembly by Financial Institutions and Insurance Committee Chairman Neil Cohen, D-Union, which would also bar collection of job and education data for insurance applications or renewals.
Assemblyman Cohen has said that in his view, use of job and education information is "just a mechanism so that insurance companies can charge more money."
According to GEICO, it evaluates more than two dozen potential risk factors in underwriting applicants, and the factors have the approval of New Jersey insurance regulators.
Monday's 1 p.m. hearing will be accessible on the Internet at www.njleg.state.nj.us.
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