Summary
ABOUT A YEAR after bestowing great praise on the regulatory environment for auto insurance in New Jersey, Warren E. Buffet may have to rethink his position. Buffet is the chairman of Berkshire Hathaway, which has insurance holdings in GEICO. Right now GEICO is in the eye of a hurricane of protest, at least in New Jersey.
As recently reported, Geico uses education and job status, among other things, to measure risk when underwriting insurance policies. Apparently, at least according to GEICO, education and job status on the one hand and risk on the other hand are inversely related so that as educational attainment increases, risk decreases. Thus, those with the lowest levels of education are charged the highest rates on auto insurance.See the full content of this document
Extract
In Defense of Geico and Free Markets
According to Phyllis Salowe-Kaye, the executive director of New Jersey Citizen Action, the use of education and job status to measure risk "is really...
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