Should You Pay More On Car Insurance For Being A Loyal Customer?

(Source: MIRS.news, Published 06/09/2026) Auto insurance companies in Michigan would be banned from charging a customer more based on them being a loyal customer than they would charge someone who's actively comparison-shopping, under a bill by Sen. Jeremy Moss (D-Bloomfield Twp.) aimed at outlawing "price optimization."

Moss, who's term-limited and running for the 11th U.S. House district, first introduced a bill similar to SB 1013 in 2016 while serving as a state representative. His bill received testimony on June 3 at the second Senate Economic and Community Development Committee meeting of 2026.

Insurance critics worried about "price optimization" see it as the practice of auto insurers charging a driver more not because of their risk profile, but because data shows they're a returning customer or have other qualities that signal they're likely to tolerate boosted prices.

"Did you know that your rates may be even higher just because you're a loyal customer to your insurance company? Price optimization is a shady practice that companies use to determine the highest price that you're willing to pay for insurance using non-risk factors like your shopping habits, your online activity, demographic data and other personal information," Moss said on June 3.

For instance, Moss said a loyal customer may have their rates jacked up because car insurers know they're likely to renew their policy "whatever the increased cost may be."

"If you're less likely to comparison shop, you're not going to see the same rewards, discounts, perks and other special offers as somebody else who may shop around," Moss said. “Even if you're in the same risk pool, insurance rates should be set on risk factors. Not whether you're likely to pay more for insurance or less likely to shop around for other options."

He said that Maryland was the first state to ban the practice of setting rates in 2014, with Ohio insurance regulators similarly publishing a bulletin in 2015.

Jennie Gies, the legislative liaison manager for the Michigan Department of Insurance and Financial Services (DIFS), described price optimization as a strategy to charge the highest price a consumer will tolerate.

In March 2024, DIFS issued a bulletin to property and casualty insurers calling the practice discriminatory and not permitted under the state's law. Gies said the department's bulletin, which currently could change as administrations change, would be codified into statute under Moss' bill.

Gies added that about 18 other states have banned the practice.

"To my understanding, there hasn't been any litigation about this," Gies said. "Other insurers…when they're doing their filings, they have to also attest that they're not using price optimization as a result of the bulletin."