What You Need to Know About Transgender Car Insurance

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Transgender car insurance: group of friends smiling at the camera

According to the Williams Institute at the UCLA School of Law, more than 1.2 million people in the U.S. classify themselves as transgender. When it comes to car insurance, many may wonder how gender identity impacts auto coverage and what rates transgender people qualify for. With more and more states allowing drivers to select a third gender option (transgender/nonbinary), what does it all mean for your auto insurance rates?

Keep reading to learn more about transgender car insurance, including which states ban the use of gender in setting rates and what transgender people can expect to pay in premiums.

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Which States Allow the Selection of Transgender Status on Driver’s Licenses?

Currently, three states and Washington, D.C allow residents to choose something other than ‘Male’ and ‘Female’ on their driver’s licensesOregon, California, and Maine.

In Oregon, you may choose “not specified” as your gender, marked as an ‘X’ on your license.

In California, S.B. 179 (the Gender Recognition Act) allows people to get a new birth certificate or driver’s license that states one’s gender as female, male, or nonbinary.

In Maine, you can select a nonbinary gender option.

Which States Ban the Use of Gender to Determine Rates?

As of this writing, eight states have banned the use of gender by insurers to determine premiums. They are California, Hawaii, Massachusetts, Maine, Michigan, Montana, North Carolina, and Pennsylvania.

What Are the Driver’s License Gender Change Policies For Each State?

Woman showing her driver's license

Each state sets its rules and regulations on transgender car insurance and how transgender people can reflect their gender status on their driver’s licenses.

For example, 17 states provide a gender-neutral option with no provider (doctor) certification required. They are Arkansas, California, Colorado, Connecticut, District of Columbia, Hawaii, Illinois, Maine, Maryland, Minnesota, Nevada, New Jersey, New Mexico, Oregon, Pennsylvania, Vermont, Virginia, and Washington.

In turn, nine states require proof of gender reassignment surgery — a court order — or a gender change on a birth certificate. They are Alabama, Georgia, Iowa, Kentucky, Louisiana, Oklahoma, South Carolina, Tennessee, and Texas.

Other states require a combination of certification from licensed professionals proving your transgender status without more challenging forms of evidence like proof of surgery. For example, Arkansas asks for a written request to its Office of Driver Services with a court-ordered change to birth certification but no other need for additional documentation.

To view each state’s rules and regulations, visit the National Center for Transgender Equality’s Drivers License Grades (May 2020) report.

Does Being Transgender Affect What I Pay for Auto Insurance?

Close-up of a person's hands holding the steering wheel

How much transgender people should expect to pay in auto insurance ultimately comes down to policies set by each state recognizing a driver’s gender status.

Some states don’t recognize gender when determining auto insurance rates. For example, the Gender Non-Discrimination in Automobile Insurance Rating Regulation (2019) by former California Insurance Commissioner Dave Jones banned insurers from calculating rates based on gender in California.

Others offer no gender-neutral option, forcing selection between ‘male’ and ‘female.’

States requiring the selection of ‘male’ or ‘female’ require auto insurance companies to quote rates consistent with that demographic. Therefore, changing your gender from male to female and vice versa may see a rate increase or decrease, depending on underwriting criteria set by each insurer.

Generally, young men pay more for auto insurance. Men under the age of 25 are likely to see higher premiums.

However, not all female drivers pay less for insurance than male drivers. For example, when the Consumer Federation of America compared quotes from major insurers, it found that “40- and 60-year-old women with perfect driving records were charged more than men for basic coverage nearly twice as often as men were charged the higher rate.”

What Other Criteria Do Auto Insurers Use to Determine Transgender Car Insurance Rates?

Outside of gender, the car insurance industry looks at several variables to determine the rates you pay. Non-binary individuals can expect auto insurance companies to use the same rating factors in their insurance application process.

These include but are not limited to your driving history, number of annual miles driven, location, and type and amount of auto insurance coverage (e.g., liability limits and amount of deductible).

Generally, those with a clean driving record free of claims, car accidents, and moving violations within the last three to five years receive ‘Good Driver’ discounts.

Lastly, remember to shop around for rates upon policy renewal and call your auto insurance provider to earn what discounts you qualify for. Rates vary drastically from one insurer to the next, even on plans with the same deductible, liability limits, and coverages.

I’ve Changed My Gender Marker on My Driver’s License. So How Do I Make the Switch With My Auto Insurance Provider?

For your auto insurance provider to recognize the switch, provide them with an updated driver’s license and inform them of your gender change and new legal name. Check with your state to learn what documentation is needed, such as a certified copy of your name change.

How Can Transgender Drivers Save On Auto Insurance?

Transgender car insurance: insurance agent shaking hands with his client

There are many ways transgender and non-binary drivers can save on auto insurance.

Policy Adjustments. Increasing deductibles and lowering liability limits is one way to save on auto insurance. However, it’s a good idea to opt for full coverage policies with comprehensive and collision coverage over state minimum liability-only policies that only cover the cost of damages to third parties, not first-party (yourself, your passengers, and your vehicle).

Applying for Discounts. Be sure to speak with an insurance agent about what discounts you may qualify for. Generally, discounts fall into three key categories: policy, driver, and vehicle-based discounts.

  • Policy-Based Discounts: Get these discounts for quoting and buying differently, such as enrolling in autopay/paperless billing and paying your policy in full upfront.
  • Driver Safety Discounts: Earn driver safety or driver-based discounts for demonstrating good driving behavior while on the road. Others include defensive driving and low mileage discounts.
  • Vehicle-Based Discounts: “Risk-proof” your vehicle to enjoy vehicle-based discounts, which may mean installing anti-lock brakes, daytime running lights, or anti-theft devices to reduce the likelihood that your vehicle is stolen.

Other discounts apply for driving an older make and model vehicle, which typically comes with a lower cost of parts, labor, and specialized knowledge to repair. No wonder drivers of electric cars pay significantly higher rates than traditional gas-powered vehicles.

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