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  1. Business
24 January 2018

Charging Momhammeds more for insurance is just the tip of a larger structural problem

By Ruqaya Izzidien

This week an investigation by the Sun revealed that motorists named Mohammed are being charged up to £919 more in car insurance than men with typically white, English names. Insurance providers Admiral, Marks and Spencer, Diamond, Bell and Elephant each quoted a higher insurance premium to clients named Mohammed. When the paper made an identical application in the name of “John Smith”, they were quoted significantly lower rates.

There is an inherent flaw in a system that favours a person based solely on their name, whether John or Mohammed. The discriminatory nature of insurance is well-documented, and, in 2012, resulted in the introduction of strict EU legislation preventing insurers from implement gender-based premiums.

But if society accepts that young, careful, male drivers should not be penalised because of their social group, why should a motorist be charged more on the basis of their name?

Admiral denied the discrimination on Twitter, stating that it does “not and never have used a customer’s name or any other piece of information to rate on race. The insurance quotes in the news today were not like for like.” Marks and Spencer told the Sun investigator that it “did not discriminate” and that they would look into the allegations further.

Although the insurance providers may deny that the outcome is based on racial bias, the discrimination against Mohammed still exists, intentional or not. Perhaps there was no board meeting which deliberately set out to implement discriminatory policies, but that doesn’t preclude the end result from being Islamophobic, nor does it absolve insurance companies of the responsibility to evaluate their own policies.

The proclaimed innocence of insurance providers is of no use to the Mohammeds who have unknowingly been paying higher premiums on account of their name. It also must come as no surprise to them to face inequality when insuring their vehicles – being penalised is nothing new to the Muslims who are frequently overlooked for jobs because of Muslim-sounding names, routinely pulled aside for extra security questioning or dragged off planes while on their holidays. In today’s Britain, Muslims expect to be racially profiled and discriminated against.

But Mohammed being quoted a higher premium than John is simply a symptom of the structural biases and discrimination that permeates through the commercial world, and it should not be the responsibility of people of colour or marginalised communities to hold companies to account for their ingrained discriminatory practices.

The response to the Sun’s report has brought out two knee-jerk narratives – one cries Islamophobia and the other, a confident assurance that there is a valid reason for insurance companies to charge Mohammeds more on the basis of their name.

The claim that the insurance providers are perpetuating Islamophobia is valid, but their discriminatory policies are not restricted to Muslims, or men named Mohammed. In 2015, Stephen McDonald, an economist at Newcastle University reported that insurance providers bypass EU regulations that prevent gender discrimination by charging higher premiums for male-dominated professions.

Conversely, it is reckless to give the ethical benefit of the doubt to large companies that exist within, and explicitly perpetuate, structural discrimination. Assumptions on social media offer the excuse that Mohammeds are charged a higher premium since they live in poor areas and that there must be a logical, ethical reason for these surcharges, despite the clear illogic in charging different insurance rates for different names – attitudes that contribute to, and normalise, structural discrimination.

If these insurance providers don’t set out to discriminate against Mohammeds, they must explain why the name generates a higher premium. Since there is no correlation between driving ability and a motorist’s name, one can only hope that insurers address their biases and ensure drivers are not arbitrarily discriminated against in the future.

In short, it’s time for a U-turn. Mohammed will show you how.

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