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Lawsuit challenges bill that allows insurance agents to consider gender in rate-making

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A lawsuit filed this week by a state senator and others challenged the constitutionality of a bill passed in 2021 that allows insurance agents to consider gender in rate-making.

The lawsuit claims House Bill 379 opened the door for insurance agents to charge people more based on their sex, a violation of constitutional protections against discrimination. 

Previously, Montana was the only state in the country that did not allow agents to consider the customer's sex when determining their rate for insurance. House Majority Leader Sue Vinton, a Republican from Billings, sponsored the legislation.

The lawsuit filed in Lewis and Clark County District is dated Nov. 2. The plaintiffs include Sen. Diane Sands, a Missoula Democrat who has termed out after the 2021 Legislature, two individuals from Kalispell and Missoula, as well as the Montana Chapter of the National Organization for Women and the American Association of University Women of Montana.

Montana insurance Commissioner Troy Downing and Commissioner of the Montana Department of Labor and Industry Laurie Esau are both listed as defendants.

A spokesperson for the Department of Labor and Industry declined to comment on ongoing litigation.

Sam Loveridge, spokesperson for the State Auditor's Office, said in an email Friday rates are still reviewed for discriminatory practices since HB 379's passage.

“All rates submitted to our agency are reviewed to ensure they are not excessive, inadequate, or unfairly discriminatory,” Loveridge said. “Our office requires companies clearly demonstrate that the gender distinct premium rates are actuarially justified. We require the companies to demonstrate the rates are based on credible experience and are statistically and actuarially justified.

Proponents of HB 379 told state lawmakers last year that meant that women were effectively subsidizing young men, who they said were shown to be higher-risk drivers that drove up costs for everyone else.

"This corrects that problem," Downing told the Senate Business, Labor and Economic Affairs Committee.

The lawsuit argues that insurance rates since the law was enacted have risen at a greater degree for men than for women, and that the law blocks those who have been discriminated against from using processes in the Montana Human Rights Act to appeal that discrimination. 

Plaintiffs asked that a judge to void HB 379 as unconstitutional.

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