The escalating cost of auto insurance is placing a significant financial burden on working families across the United States. Recognizing this growing pressure, Congresswomen Rashida Tlaib (MI-12) and Rosa DeLauro (CT-03) have introduced the Auto Insurance Expense Relief Act, a crucial piece of legislation aimed at providing car insurance relief by integrating this essential expense into the formulas that determine eligibility for federal assistance programs.
For millions of Americans, owning a car isn’t a luxury—it’s a necessity for commuting to work, accessing essential services, and managing family responsibilities. In fact, almost every state, with the exception of one, mandates auto insurance for drivers. Despite this requirement and the considerable monthly expense it represents, car insurance costs are currently not factored into the calculations used to assess eligibility for federal aid. This oversight creates a significant gap, particularly as auto insurance premiums have surged by an average of 26% nationwide in 2024. This increase exacerbates financial strain, pushing more families into cycles of poverty and making it harder to make ends meet.
The Car Insurance Relief Program, as envisioned by the Auto Insurance Expense Relief Act, seeks to rectify this disparity. By allowing auto insurance expenses to be considered when evaluating applications for federal assistance, the bill aims to provide a more accurate reflection of a household’s true financial needs. This adjustment would enable more working families to qualify for vital support, offering much-needed car insurance relief and bolstering their overall financial stability.
Congresswoman Tlaib emphasized the urgency of this legislation, stating, “While expenses like rent and utilities are rightly considered when determining federal assistance eligibility, it is simply unjust that auto insurance is not. The Auto Insurance Expense Relief Act is vital to alleviate the economic pressures faced by struggling families.” She further highlighted the particularly acute situation in her district, noting, “Detroit residents continue to endure the highest auto insurance rates in the country, with rates skyrocketing by 85% in the past year alone. This is fundamentally about economic justice—ensuring that working families receive the support they are entitled to.”
Congresswoman DeLauro echoed this sentiment, adding, “For American families budgeting monthly, insurance costs are always a primary consideration. It is illogical and detrimental that auto insurance is disregarded when assessing eligibility for federal assistance. I am proud to collaborate with Congresswoman Tlaib on this bill to ensure these essential costs are factored in, allowing families to access the resources necessary to afford food, housing, and family care.”
Beyond the Auto Insurance Expense Relief Act, Congresswoman Tlaib has also championed the Prohibit Auto Insurance Discrimination (PAID) Act. This separate but related initiative tackles discriminatory practices within the auto insurance industry, aiming to eliminate the use of “non-driving factors” such as education level, zip code, marital status, and credit score in rate calculations. These factors, which have no bearing on driving safety, often lead to unfairly inflated premiums for certain demographics.
The Auto Insurance Expense Relief Act has garnered significant support from advocacy groups and policy organizations, including Mothering Justice, People’s Policy Project, Center for Popular Democracy, Detroit Action, We the People Michigan, Wayne Metro Community Action Agency, and Michigan United.
Danielle Atkinson, Executive Director of Mothering Justice, underscored the bill’s importance for equitable income assessment, stating, “Car insurance is an unavoidable expense, and it is illogical to penalize individuals by excluding it when determining their need for assistance. Cities like Detroit exemplify the disproportionate burden of high car insurance costs on low-income communities.”
The University of Michigan Poverty Solutions consortium further elaborated on the necessity of car insurance relief, noting, “Inadequate public transportation in many areas makes car ownership essential for employment. Auto insurance, therefore, becomes a significant and unavoidable expense, consuming a substantial portion of household budgets for those with limited incomes. For instance, in Florida, the state with the highest premiums, annual auto insurance costs can reach approximately 19% of an individual’s poverty line income.”
Matthew Bruenig, President of the Peoples Policy Project, succinctly captured the core issue: “In most of the US, cars are essential for work, and insurance is essential for driving legally. Work-related and basic expenses like these must be deducted from income to accurately assess the resources available to families eligible for SNAP and other assistance programs.”
The full legislative text of the Auto Insurance Expense Relief Act is publicly accessible here. This bill represents a critical step towards providing meaningful car insurance relief and ensuring that federal assistance programs are genuinely accessible to working families struggling with the rising cost of living.
