BissCollinsPresserCHICAGO – Two Illinois state senators want to stop car insurers from charging higher premiums to people who live in predominantly minority neighborhoods, a bias that was revealed in a ProPublica-Consumer Reports investigation earlier this month.

The first-of-its-kind analysis, which focused on Illinois and three other states, revealed pricing disparities among car insurance premiums paid by customers based on their ZIP codes.

In some cases, residents in predominantly minority neighborhoods of Chicago paid as much as 30 percent more in premiums than residents in mostly white neighborhoods — a disparity for which differences in risk could not account.

The report noted that the overpricing “may amount to a subtler form of redlining” by the industry, a reference to the denial of services to minority neighborhoods.

“As a mathematician, as a lawmaker and as a person who fights for equality, I am deeply troubled by the questions that were raised in this investigation,” said state Senator Daniel Biss, an Evanston Democrat. “The types of across-the-board disparities described in the report don’t occur by accident. There clearly is a systemic problem that needs to be addressed by the insurance industry and by the government on behalf of consumers.”

Biss and state Senator Jacqueline Y. Collins, a Chicago Democrat, will introduce legislation that prohibits insurers from using a person’s ZIP code as grounds for determining premium rates.

Collins and Biss will amend Senate Bill 1706, which is Collins’ pending legislation to bar insurance companies from using a person’s credit rating to determine how much they should pay for car insurance premiums, a practice that is considered discriminatory to minority and low-income populations but is legal in Illinois.

“This is a pattern of discrimination all too familiar to people of color at every level of modern life,” Collins said. “A fair market demands a level playing field. Stories like this remind us that this requires investigation and regulation. I want to applaud the journalists who brought these unfair practices to light and to commend Senator Biss for helping to strengthen this legislation.”

The ProPublica-Consumer Reports analysis examined more than 100,000 premiums charged for liability insurance in each of the states studied. The analysis was limited to one type of customer: a 30-year-old woman with a safe driving record. Their premiums were compared to the average amounts paid out by insurers for liability claims in each ZIP code.

The findings were alarming. Of the 34 companies analyzed in Illinois, 33 charged at least 10 percent higher premiums on average for the same safe driver in minority ZIP codes than in comparably risky white ZIP codes. Six Illinois insurers had average disparities higher than 30 percent, according to the analysis.

Dory Rand, president of the Chicago-based Woodstock Institute, a nonpartisan policy and research organization focused on fair lending, wealth creation and financial systems reform, said such practices can pose significant financial challenges for people already struggling to get by.

“Auto insurance price optimization schemes discriminate against workers of color and impair workers' economic security by making it more difficult for them to get to work and to meet other expenses,” Rand said.

“Woodstock Institute applauds the ProPublica investigation and the efforts of Senators Biss and Collins and their colleagues in the Illinois General Assembly to bring fairness to auto insurance pricing.”

Critics of the investigation said it was incomplete and oversimplified the way insurance companies set their rates.


Category: Latest

Biss2017As tension grows between the Trump administration and local communities that choose to reject his anti-immigration agenda, it will become increasingly important for states like Illinois to pass laws that reflect local values and protect basic American principles, Senator Daniel Biss said Wednesday.

“People in Illinois should not live in fear of going to school or talking to the local police,” said Biss, a Democrat from Evanston, which has been a sanctuary city where all people are welcome since 2008. “We should not allow children, parents, the elderly and the infirmed to retreat into the shadows because they are terrified that they could be detained and deported by immigration authorities anytime they or their loved ones step out of their homes to go to school or to a clinic.”

Biss is a co-sponsor of Senate Bill 31, which creates the Illinois Trust Act to blunt the impact of federal overreach on immigration matters. The legislation would:

  • clarify that state and local police are not deputized immigration agents and therefore are not expected to expend resources enforcing or complying with federal civil immigration detainers and administrative warrants;
  • prohibit state and local police from searching, arresting or detaining a person based solely on citizenship or immigration status or an administrative warrant;
  • prohibit law enforcement agencies from using state resources to create discriminatory federal registries based on race, national origin, religion or other protected classes; and
  • establish safe zones at schools, medical facilities, courts and properties operated by the Illinois secretary of state, where federal immigration enforcement would not be admitted without a valid criminal warrant.

The measure also would establish deadlines for police to complete certification forms that are requested by immigrant victims of violent crimes who cooperate with police. The certifications are among the requirements for immigrant crime victims to apply for certain visas.

The act would not bar state and local police from conducting valid criminal investigations or serving criminal warrants, nor would it bar them from working with federal immigration agents to serve valid warrants.

The Illinois Trust Act passed out of the Senate Executive Committee today and is expected to be voted on by the full Senate.

“What this legislation says is that Illinois is not OK with the federal government deputizing local police departments to do work they have neither the resources nor the training to do,” Biss said. “It also says Illinois does not condone any effort to catalog human beings based on their race, religion or nation of origin.

“Every day, state and local police throughout Illinois try to foster trust – not fear and suspicion – with immigrants in their communities so that they can protect people, solve crimes and keep the lines of communication open,” he added. “Trump’s deportation rhetoric accomplishes exactly the opposite. That’s not good for America or for Illinois.”

Category: Latest

SenatorBissMarch2017Private equity firms would have to disclose the investment fees they charge to public pension funds in Illinois under legislation sponsored by Senator Daniel Biss (D-Evanston).

These sometimes lucrative fees charged by private equity firms and hedge fund managers are exempt from disclosure to taxpayers under current state transparency laws. Even the boards that oversee the pension funds are kept in the dark about the fees. That’s ludicrous, Biss said.

“Taxpayers have the right to know what government pays for salaries, pensions, cars, office supplies, phone bills – every penny that goes out the door, down to the most miniscule expense,” he said. “But we make an exception for lucrative pension investment fees paid to private equity firms. It’s indefensible.”

Senate Bill 779 would require pension systems to disclose agreements with private equity funds and certain provisions of those agreements. It also would require private equity fund managers and general partners to disclose certain investment fees paid to the funds.

Disclosures would be published on the pension systems’ websites and would be subject to the state’s freedom of information act. The legislation applies to every retirement system or pension fund regulated by the Illinois Pension Code, as well as the Illinois State Board of Investment.

The Teachers Retirement System, the largest pension system in Illinois, currently has nearly $8.5 billion invested and committed to the private equity asset class. Some funds, such as Downstate Police and Fire Funds, are precluded by law from making such investments.

Senate Bill 779 passed out of the Senate’s Licensed Activities and Pensions Committee Wednesday on a 7-5 partisan roll call.

According to a 2015 ranking by Institutional Investor’s Alpha magazine, the country’s 25 top-earning hedge fund managers raked in an estimated $11.6 billion in 2014. The previous year, the top 25 collectively earned nearly double that, estimated to be more than $21 billion.

Comparatively, the aggregate pay for all of the kindergarten teachers in the nation in 2014 was an estimated $8.5 billion.

Category: Latest

The Rauner administration is trying to privatize nursing in Illinois’ prison system, Senator Daniel Biss (D-Evanston) said Wednesday.

Biss’ comments were prompted by word that the Rauner administration is outsourcing the jobs of 124 prison nurses employed by the Illinois Department of Corrections to a private company. The unionized nurses are represented by the Illinois Nurses Association, and their layoffs are effective June 15, according to a March 18 letter from the administration to the association announcing the changes.

“This appears to be nothing more than a back-door attempt to get around Illinois’ ban on privatizing prisons,” Biss said. “Gov. Rauner is offering up another failed policy that looks like it came straight out of the Trump White House.”

Illinois banned private prisons in 1990. The General Assembly declared that “the management and operation of a correctional facility or institution involves functions that are inherently governmental.” However, the privatization ban does not apply to ancillary services, such as medical care.

“Just last week, Gov. Rauner tried to insist he had the best interests of state workers at heart. This week he’s laying off 124 nurses employed by the state,” Biss said. “The only interests I think Gov. Rauner has at heart are those of his business friends who can make money off state government.”

Category: Latest

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