Report: Drivers in minority neighborhoods pay more for car insurance

Your age, your vehicle, even your credit score all affect what you pay for car insurance, but a new study reveals something else at play.

Otis Nash is one example. He spent his entire life in a mostly minority neighborhood in the Chicago area. Nash is rated a good driver and pays almost $200 dollars a month for his Geico auto insurance policy.

Just 14 miles away, Christopher Day is also rated a good driver. He lives in a mostly white Chicago neighborhood. He pays around $115 dollars a month for a Geico policy with more coverage for liability but less for comprehensive and collision.

It's a disparity Consumer Reports and ProPublica saw time and again.

"We looked at 34 different insurers in Illinois, and 33 of them had, on average, a difference between minority and non-minority neighborhoods of higher than 10-percent," said ProPublica Senior Reporter Julia Angwin.

Investigation researchers also found disparities from neighborhood to neighborhood in Missouri, Texas and California.

"I think we can say, based on these four states, is that it certainly raises questions about what's going on nationally," Angwin said.

In California, Pernell Cox uses Safeco. He lives in the affluent, predominantly African-American neighborhood of View Park in Los Angeles.

The investigation found a safe driver in View Park pays 13 percent more on average than one who live in a white neighborhood of comparable risk.

"Learning that our community might be targeted for higher insurance rates than the risk is a reason for people to be angry," Cox said.

The California Department of Insurance criticized Consumer Reports' and ProPublica's approach. Liberty Mutual, the parent company of Safeco, says it is "committed to competitively priced car insurance options."

The Illinois Department of Insurance called the methodology "incomplete" and says it "does not tolerate discrimination."

Geico did not comment.

Meanwhile, Otis Nash says he hopes rates become fairer, but for now Geico is among the cheaper insurance companies he could find in Chicago.

Pernell Cox shopped around in Los Angeles and found a $400 dollar annual savings with a different insurer.