Big brother is an insurance agent Posted
by mitcka at 04/06/05 04:23 PM
Thanks to an anonymous poster on SlashDot for information about a strange bill moving forward right here in my home state of Texas. It authorizes a big government database of auto insurance information and RFIDs embedded in car inspection stickers.
This wouldn't be the first time Texas has tried to make sure that all drivers have auto insurance by creating a database of private insurance information, but this may be the most egregious example. HB 2893 by Representative Larry Phillips authorizes the Texas Department of Public Safety to create a database that is continually updated by insurance companies to include insurance information, car information and “any other information reasonably required by the department.” Wow!
But wait, there’s more. Law enforcement, as well as “other state and local government entities” will have access to the information—and there appears to be no limit on the purposes for which these various “entities” can use the information.
But wait, there’s more yet! The bill would place RFIDs in everyone’s inspection sticker, and authorizes an automatic fine of $250 if a RFID reader detects a RFID signal, sends a query to the big insurance database, and the database can’t verify insurance coverage on that vehicle.
A Texas blogger, Grits for Breakfast, has some interesting thoughts on DPS security as it relates to the agency's effort to also collect biometric information on drivers [disclaimer: “Grits” is my husband].
Consumers Union has consistently opposed creating a big government database of insurance information—even the much more limited ones proposed two years ago—due to security concerns and because current insurance practices make it very difficult for some people to get the insurance that is mandated by law at anything like an affordable price. Insurers use credit scores, among other factors, to determine what you pay or whether you can even buy auto coverage. So, if you've got an error or blemish on your credit report, you could end up uninsured.
So before we institute automatic civil penalties generated by RFID readers we should face up to the significant insurance underwriting reform that is needed to improve access to coverage.
If you live in Texas, you can find the contact information for your legislators at the Capitol web site and contact them about this bill.
comments
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Posted by MinO at 12/22/05 03:24 PM
I'm curious about your comment: "...current insurance practices make it very difficult for some people to get the insurance that is mandated by law at anything like an affordable price. " You mention insurers using credit to determine "...whether you can even buy auto coverage". With 2004's SB14, I don't think this latter is true anymore, thank goodness, but what practices would you say inurers are doing that harms our ability to get insurance? Or what reforms are needed? Can you share what can be done differently? Thanks for your blog!
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Posted by mitcka at 12/27/05 03:48 PM
Hi MinO: I think my original statement was that insurers use credit score "among other factors," and if memory serves me the 2003 Texas legislation (SB 14) you reference limited the use of credit scores "solely" as the reason to deny coverage. It can be used "among other factors."
We were very happy that this legislation passed, and we believe it was a start, but we remain unconvinced that your ability to pay a credit card bill has much to do with your driving record and therefore hope for still more improvements in underwriting that will ensure access to coverage for all Texans.
