What does a person credit score have to do with rates on car insurance rates?
by Author on Sunday, June 6th, 2010 | 3 Comments
It should be against the law since everyone must carry car insurance. Also, what does my low credit score got to with my great driving record? Sounds like another reason to raise rates because most credit scores are low across the board. If someone pays their insurance company on time and has a good driving record should be their only concerns. Doesn't that make sense to raise car insurance rates to persons that had a hard time paying a bill, bit made all their car insurance payments on time.
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It will take a few years but some states have passed laws that ban the companies from using credit in their equations. In a few years we will see if their new ‘equations’ work as well as the equations that have credit in them. If they do, then many states will be passing laws to ban credit use
Here is some more detailed info about it -
http://carquotes.fateback.com
Hope that helps.
Actuarial studies show that how a person manages his or her financial affairs, which is what an insurance score indicates, is a good predictor of insurance claims. Statistically, people who have lower insurance scores tend to file more claims.
In California credit scores are not considered in auto insurance rates. I agree that credit scores should not be used.
You need to contact the people that make the laws in your state to get your laws changed so credit scores will not be considered. Some people think it is also discrimination.
Good Luck.