Insurance and credit score make a troublesome mix

Credit score and its use by the insurance industry is not well understood by consumers Insurance and credit score are too things that often intermingle without much notice. Many insurance companies use credit score and other socio-economic information to price policies. This is somewhat common in some U.S. states, but it is also banned in much of the country due to the fickle nature of credit and the relatively loose understanding that consumers have regarding their own credit scores. Suze Orman, a prominent financial advisor, has been calling into question…

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Department of Justice proposes reform to stop insurers from using credit scores for screening

The government of New Brunswick has proposed a number of regulations that may stop car insurance companies from being able to include data relating to an individual’s credit score in order to determine whether or not they will insure them, and what their premiums will be every month. There were a number of draft regulations posted by the Department of Justice on its website for public consultation that would change the guidelines for underwriting by insurers. The consumer advocate for insurance of New Brunswick, Ronald Godin, began his push for…

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Massachusetts insurance agents rally against use of socioeconomic factors to price insurance coverage

Massachusetts insurance agents have come together to oppose the use of credit score and other socioeconomic factors when determine the cost of auto insurance. The Massachusetts Association of Insurance Agents (MAIA) will be campaigning to bring the matter before Congress, where the group hopes legislators will ban what they call a “discriminatory practice.” More than 1,400 agencies representing MAIA are currently mobilized to gather signatures from registered voters for a petition that will bear their concerns to lawmakers. The campaign has won the support of Attorney General Martha Coakley, who…

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MAIA proposes 2012 referendum ballot to stop socioeconomic factors from impacting auto insurance premiums

The Massachusetts Association of Insurance Agents (MAIA), a group based in Milford, has put forth a proposal for the 2012 election for a ballot referendum that would stop auto insurers from becoming able to use socioeconomic factors to underwrite their insurance. This practice is already banned by the state, but the MAIA is seeking to continue making it illegal to use information such as a person’s education, job type, and credit score for determining an individual’s auto insurance premiums. That said, organizations that represent auto insurers are arguing for the…

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A bad credit score can mean costly insurance rates

Insurance and credit

Drivers with bad credit have always had a problem obtaining affordable car insurance. Few insurance companies would deny offering coverage to such drivers, but the policies available tend to be pricey. Between insurance premiums and deductibles, some of the cheapest policies drivers with bad credit can get will cost them more than $300 every month. GEICO and Farmers are two insurers looking to ease the stress of the issue by offering plans tailored for motorists with bad credit. Credit score plays a vital yet little known role in how insurance…

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Bad credit can make for a higher car insurance rate

As if things weren’t bad enough for people who have been affected by the mass foreclosures, job loss, and overall slumping economy; here is that proverbial “last straw,” that could be the back breaker. Everyone knows that a low credit score can determine the rate you pay on a loan; it can also determine your insurance rate. A recent survey shows that 92 out of 100 insurers use your credit score, along with other factors, to decide whether to write you a policy, and if so, what your premium should…

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