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If there is no basis for being higher risk, why wouldn't an insurance company want to make more money?

Are you suggesting that their "inherent racism" is causing them to forgo shareholder profits?

They need to be as cheap as possible to remain competitive. This means identifying risky clients and either charging them more or worse refusing their business to make sure they are not taking on too much risk while trying to be competitive. If this were not the case then they would keep it simple and just charge a flat rate (that covers the highest risk they are willing to accept) to all customers.

Using discriminating factors that are simply correlated rather than causal is unfair as it penalises some people within a given profiled group for no good reason. This may not be due to inherent racism, but merely due to not properly understanding the statistics. Or not due to inherent racism now but because of lazy "it has always been done this way" reasoning. It may in part be due to racism, of course, as people are less likely to question results that agree with their worldview.

Identifying the correct causal factors and using the as discriminators is fair, and can be demonstrated to be better for the business too by allowing lower prices for some groups aiding competitiveness, but it can be harder work leading to the less effective and less fair option being used - saving effort now at the expense of being fair (and some potential longer-term business benefits).

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