I 

116TH CONGRESS 

1ST SESSION H. R. 2684 

To require the Federal Insurance Office of the Department of the Treasury 

to conduct a study to identify disparities between communities in auto 

insurance costs and payout amounts based on the predominant racial 

makeup of such communities, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 10, 2019 

Mr. TAKANO introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To require the Federal Insurance Office of the Department 

of the Treasury to conduct a study to identify disparities 

between communities in auto insurance costs and payout 

amounts based on the predominant racial makeup of 

such communities, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Fair Auto Insurance 

5 Ratemaking Reporting to Allow a Transparent Evaluation 

6 of Statistics Act of 2019’’ or the ‘‘FAIR RATES Act of 

7 2019’’. 


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1 SEC. 2. DATA CALL. 

2 (a) IN GENERAL.—Pursuant to the authority under 

3 section 313(e) of title 31, United States Code, the Direc4 tor of the Federal Insurance Office shall collect from cov5 ered automobile insurers, aggregated on a census tract 

6 level basis based on the place of garaging of the insured 

7 vehicle, information for each of the three accident or cal8 endar years, as applicable, most recently completed as of 

9 the date of the enactment of this Act, regarding private 

10 passenger automobile insurance as the Director considers 

11 necessary to prepare the report required under section 3, 

12 which shall include the following information for each such 

13 year: 

14 (1) COMPANY NAME.—The name of the insur15 ance coverage for the vehicle. 

16 (2) EXPERIENCE YEAR.—The experience year 

17 for premiums and exposures. 

18 (3) CENSUS TRACT.—The census tract of the 

19 place of garaging of the insured vehicle. 

20 (4) PAID LOSS ADJUSTMENT EXPENSES.—Total 

21 paid loss adjustment expenses, reported by accident 

22 year. 

23 (5) INCURRED LOSS ADJUSTMENT EXPENSES.— 

24 Total incurred loss adjustment expenses plus case 

25 reserves, reported by accident year. 


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1 (6) COUNT OF CLAIMS RECORDED.—The num2 ber of claims reported for each coverage or type of 

3 loss, including claims that included payment and 

4 claims that did not include payment. 

5 (7) COUNT OF CLAIMS CLOSED.—The number 

6 of claims closed for each coverage or type of loss, in7 cluding claims that were closed that included pay8 ment and claims that were closed that did not in9 clude payment. 

10 (8) COVERAGE TYPE.—The type of coverage 

11 provided, including liability, personal injury protec12 tion, collision, comprehensive, and uninsured motor13 ist bodily injury. 

14 (9) PREMIUM WRITTEN.—Total premium writ15 ten, reported by coverage type. 

16 (10) PREMIUM EARNED.—Total premium 

17 earned, reported by coverage type. 

18 (11) EXPOSURE WRITTEN.—Total exposures 

19 written, reported by coverage type. 

20 (12) EXPOSURE EARNED.—Total exposures 

21 earned, reported by coverage type. 

22 (b) METHOD AND TIMING OF COLLECTION.— 

23 (1) FROM FEDERAL OR STATE AGENCY.—Not 

24 later than the expiration of the 6-month period be25 ginning on the date of the enactment of this Act, the 


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1 Director shall determine whether all of the informa2 tion required to be collected under subsection (a) 

3 can be obtained in the manner provided under the 

4 first sentence of section 313(e)(4) of title 31, United 

5 States Code, in a timely manner. If the Director de6 termines that all such information is available, and 

7 may be obtained by such manner in a timely man8 ner, the Director shall so obtain all such informa9 tion. 

10 (2) FROM INTERMEDIARY.—If the Director de11 termines under paragraph (1) that all of the infor12 mation required to be collected under subsection (a) 

13 cannot be obtained in the manner provided under 

14 the first sentence of section 313(e)(4) of title 31, 

15 United States Code, and in a timely manner, the Di16 rector shall provide that covered automobile insurers 

17 shall submit any such information that is not so ob18 tainable through— 

19 (A) an appropriate intermediary, including 

20 the National Association of Insurance Commis21 sioners; or 

22 (B) other appropriate intermediaries, in23 cluding advisory organizations and statistical 

24 agents licensed by State insurance regulatory 

25 authorities. 


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1 (3) FROM COVERED AUTOMOBILE INSURERS.— 

2 If the Director has not received all of the informa3 tion required to be collected under subsection (a) be4 fore the expiration of the 12-month period beginning 

5 on the date of the enactment of this Act, before the 

6 expiration of the 18-month period beginning upon 

7 such date of enactment, the Director shall collect 

8 from covered automobile insurers, in accordance 

9 with the penultimate sentence of section 313(e)(4) of 

10 title 31, United States Code, any such information 

11 not so received. 

12 SEC. 3. STUDY. 

13 (a) IN GENERAL.—The Director shall conduct a 

14 study, using the information collected pursuant to section 

15 2 and any other appropriate information available, to com16 pare private passenger automobile insurance premium 

17 costs and claims payment amounts to identify any dispari18 ties in such premium costs and claims payment amounts 

19 between coverage for automobiles garaged in census tracts 

20 and areas having a majority of residents who are racial 

21 minorities and coverage for automobiles garaged in census 

22 tracts and areas having a majority of residents who are 

23 not racial minorities. Not later than the expiration of the 

24 24-month period beginning on the date of the enactment 

25 of this Act, the Director shall submit to the Congress a 


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1 report containing the analysis, findings, and conclusions 

2 of the study under this section. 

3 (b) AVAILABILITY OF INFORMATION.—Upon submit4 ting the report to the Congress pursuant to subsection (a), 

5 the Director shall make publicly available all information 

6 collected pursuant to section 2 and all other information 

7 used in the conducting the study under this section, except 

8 that any information made publicly available may not con9 tain any personally identifiable information regarding in10 sureds under private passenger automobile insurance for 

11 which such information is collected. 

12 SEC. 4. DEFINITIONS. 

13 For purposes of this Act, the following definitions 

14 shall apply: 

15 (1) COVERED AUTOMOBILE INSURER.—The 

16 term ‘‘covered automobile insurer’’ means an insurer 

17 that— 

18 (A) has a statutory surplus attributable to 

19 private passenger automobile insurance cov20 erage, as of December 31, 2017, in an amount 

21 that exceeds $500,000,000; and 

22 (B) annually collects more than 

23 $500,000,000 in premiums for private pas24 senger automobile insurance coverage. 


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1 (2) DIRECTOR.—The term ‘‘Director’’ means 

2 the Director of the Federal Insurance Office of the 

3 Department of the Treasury. 

Æ 


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