Car insurance companies use factors such as drivers’ demographic information, driving history, and more to calculate individual premiums. Statistical correlations between factors like a driver’s age and the likelihood of getting into a collision are used to justify these cost differences.
But a recent study found a high correlation between another personal factor and accident rates: whether or not a driver has received a COVID vaccine. Given how car insurance pricing works, our team was curious about whether or not an insurer could potentially use a person’s vaccine status as a determining factor in their rates.
The Strong Correlation Between Vaccine Status and Car Accident Rates
A clinical research study titled “COVID Vaccine Hesitancy and Risk of a Traffic Crash” published in The American Journal of Medicine in December 2022 examined the vaccine status of people involved in automobile accidents. The results show a strong positive correlation between being unvaccinated and getting into a collision.
The study included 11,270,763 individuals, with 84% of participants having received a COVID vaccine while 16% had not. Researchers recorded 6,682 traffic accidents among the individuals in the study. The data showed that unvaccinated people accounted for 1,682 of those crashes, or around 25% of them. This is equivalent to a 72% increase in the accident rate for people who did not receive a vaccine, which adjusts down to a 48% increase when controlling for other factors.
Vaccination Status Correlation Compared to Other Risk Factors
A 72% increase sounds significant on its own, but it’s important to see how it compares to other risk factors. The study included a table of additional risk factors – some used by insurers and others that are not – to provide additional context.
Not having a COVID vaccination ranked as the fourth-highest relative risk among all factors included in the table. Alcohol misuse, depression, and being listed as “male” on state records are the only factors that have a higher relative risk than not being vaccinated.
Interestingly, the study shows that not being vaccinated has a higher relative risk than being a younger driver – one of the factors with the largest impact on insurance premiums.
There are Numerous Challenges to Using Vaccine Status as a Factor
While the risk correlation between vaccination status and the likelihood of getting into an accident on the road is strong, there are both ethical and legal reasons why using vaccination status as a determining factor in insurance rates would be difficult.
We spoke to expert Drew Nicholson, Insurance and Risk Manager at North Carolina State University, to get his thoughts on whether one’s vaccination status could be used to calculate a driver’s insurance rates.
Medical Information Isn’t Typically a Factor in Car Insurance Rates
Nicholson said that he doesn’t think that insurance companies will use vaccination status as a factor. One of the main reasons, he said, is that there simply isn’t precedent for car insurers using medical information in their rate calculations.
“In my opinion, it is highly unlikely an insurance company will use someone’s vaccination status as a factor in determining insurance premiums,” Nicholson said. “Although life and health insurance companies use health or medical records to determine premiums, automobile insurance carriers historically do not use medical records in determining premiums.”
There Are Also Practical Obstacles and Legal and Ethical Concerns
Nicholson added that there are several other reasons why vaccination status won’t likely become a factor in drivers’ premiums. On the practical side, current law would require drivers to opt in to sharing their medical records in the first place.
“The Health Insurance Portability & Accountability Act (HIPAA) protects individual medical records,” said Nicholson. “In order to share personal medical records with an automobile insurance company, the individual would have to sign a consent form to share the information.”
This would create an additional step and more work for insurance companies. It would also create a split between people willing to share their records and those who aren’t – leaving insurance companies to figure out how to account for the difference.
Nicholson said that using vaccination status also presents ethical concerns about what other medical information insurers could potentially use to formulate premiums.
“If auto insurers began using medical records like vaccination status, this would open up a huge can of worms for insurance companies in regards to other health factors which could lead to increased risk of driving,” he said.
Those ethical issues could also result in legal issues for auto insurers. Dealing with those legal issues could be a costly and time-consuming endeavor, and not one Nicholson believes most companies would want to undertake.
“This would only cause legal problems an insurance company would not want to embark on for simple auto insurance rates,” said Nicholson.
Risk Correlation Isn’t Everything When It Comes to Insurance Rates
The high degree of correlation between one’s vaccination status and the likelihood of getting into an accident is indeed noteworthy. But Nicholson pointed out that there are many factors correlated with a higher risk of accident that insurers also don’t consider in their premiums.
“I am sure that smoking cigarettes has a similar correlation,” he said. “Along the same thought process as the research study argues [around] not getting the COVID vaccination, cigarette smokers would be classified as someone willing to take more risk therefore a high risk [for insurers].”
Even conditions that were included in the risk comparison portion of the study that show an increased risk of accident are not among determining factors in the rates insurers set for policyholders. Indeed, there are likely countless variables that can be correlated with a higher accident risk that insurance companies don’t and likely won’t account for.
There Are Also Ethical Concerns for Rate Factors Insurers Currently Use
There are some factors that car insurance companies do currently consider that may raise ethical issues. Credit scores are one example of a controversial factor. State governments in California, Hawaii, Massachusetts, and Michigan have outlawed the use of a person’s credit score in their car insurance premiums. But in every other state, credit scores can have a major impact on a person’s rates.
According to cost data sourced from Quadrant Information services, drivers with poor credit in the U.S. pay nearly 81% more than drivers with good credit with all other factors the same. Nicholson says that there is risk assessment logic to that.
“Studies show that drivers with poor credit file more auto insurance claims than drivers with better credit,” he said. “Therefore, the higher your credit score, the lower your auto insurance premium.”
While the risk valuation Nicholson describes does make logical sense, using credit scores as a factor can have an enormous impact on a driver’s financial situation. People with lower credit scores already pay more for auto loans and other financial products, and a dramatic increase in insurance rates only makes things harder for people who are more likely to be in a difficult financial position.
The use of ZIP codes as a factor presents similar problems. Differences in crime rates, populations, accident rates, and more between ZIP codes are logical factors in insurance premiums. However, those factors also align with significant racial differences between ZIP codes, meaning a person’s race likely also correlates with differences in how much they pay for car insurance.
Vaccine Status Won’t Likely Affect Your Rates, But It’s Worth Considering What Does
The practical, legal, and ethical challenges of using a person’s vaccine status as a factor in their insurance rates mean that it probably won’t be part of the calculation anytime soon. But given the high degree of correlation compared to other factors that do affect insurance premiums, it is perhaps worth questioning the ethical implications of some of the factors that are currently in use.
As mentioned earlier, lawmakers in some states have already outlawed the use of credit scores as a factor in auto premiums. This means they have the ability to do the same for other factors.
There is very little chance that whether or not a person has gotten a COVID vaccine will factor into how much they pay for auto coverage. But the compelling data around the issue provides an opportunity to examine what personal factors insurance companies are allowed to charge policyholders for, and whether they should be allowed to do so.