Gender-Neutral Car Insurance

How do car insurance companies account for gender-fluid and non-binary drivers?

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Car insurance and gender neutrality

 

While many U.S. states recognize non-binary gender identity on official driver's licenses and IDs, the auto insurance industry has been slower to adapt, continuing to use gender as a rating factor when pricing policies.

Currently, the below states require auto insurance companies to either offer non-binary gender options on insurance applications or require companies to discount gender as a rating factor:

Learn more about the current state of gender-based pricing in the car insurance industry.

 

How gender is used as an auto insurance rating factor

 

Gender is one of the primary factors used by car insurance companies to assign premiums. It's worth noting that gender only impacts insurance costs substantially for teen drivers, as young male drivers pay a premium compared to their female counterparts. Once a driver leaves their teen driving years behind, the difference between car insurance rates for women and men is relatively small.

Because historical data shows that young male drivers get into more accidents and file more claims, insurers charge higher premiums to account for the additional risk.

 
Driver AgeAverage Monthly Rate — MaleAverage Monthly Rate — Female
16$503$453
17$429$383
18$377$334
19$273$240
 

While a car insurance policy priced without gender taken into consideration might not affect older drivers, the stakes are higher when a young driver is involved.

 
 

 

Why do auto insurance companies use a driver's gender to set their rates?

 

Insurance companies — especially auto insurers — have specific ways of doing business from which they’re slow to deviate. Insurance companies determine what you will pay going forward — your premium — based on the previous year's historical data. They rely on the past to dictate how they do business in the future.

For an insurance company, it is hard to predict what a “gender-neutral” individual will mean in terms of risk. It's hard for an insurer to provide a non-binary gender option to their client if a gender-neutral driving risk baseline hasn't yet been established.

 

 

 

Additional resources

 

While gender-neutral car insurance doesn’t currently exist, it might in the future. Because car insurance companies rely on previous years' data to set pricing, it is hard for an insurer to price a gender-neutral client. But with ongoing legislation and support, car insurance for non-binary drivers could soon be a reality.

If you're interested in gender-neutral car insurance, speak directly with an insurance agent. Most online platforms will require you to select male or female to obtain a quote, but an agent might offer more flexibility.

For more information on gender's influence on car insurance, see the below:

Compare insurance rates online today.

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Ava Lynch LinkedIn

Ava worked in the insurance industry as an agent for four-plus years. Currently providing insights and analysis as one of The Zebra’s resident property insurance experts, Ava has been featured in publications such as U.S. News & World Report, GasBuddy, and Yahoo! Finance.