Your credit history can dramatically affect your auto insurance premium. According to a 2001 survey of the top 100 insurers in the country by Conning & Co., 92 percent of responding insurers use credit information to create an "insurance risk score," which they then use as a factor to determine your auto insurance rate. The theory is that there is a direct correlation between your insurance risk score and the likelihood that you will file a claim. Insurance scores are intended to evaluate your stability, meaning if you pay your bills in a timely fashion and have had the same credit accounts for long periods of time, you're considered more stable than someone who pays late or sporadically and who opens and closes accounts frequently. What you can do: Unfortunately, your insurance risk score is not available to you, but it may be similar to your credit score. If you have unusual credit activity that is limited in its time frame, you will benefit from waiting a month for activity to return to normal before buying auto insurance, so your score returns to normal. If your credit history is shaky, be prepared to pay higher premiums since your insurance company may deem you a higher risk. See How your credit history affects your auto insurance premiums. http://www.insure.com/auto/creditscores.html
My brother has one NOT AT FAULT accident (HIT AND RUN DRIVER), NO tickets...pays HIGH RATES because of EX-WIFE'S CREDIT MESS... SOUNDS FAIR??? I DON'T THINK SO!!!
Why do we as consumers, continue to do business with insurance companies that require our credit report to quote us an insurance premium? There are insurance companies out there that do not pull one's credit report to issue a prepaid insurance policy. Just because most of the industry does it, does not mean they all do. We need to give our business to those that don't use our score to base our premium. We can complain, complain, and complain some more, but until we take our business elsewhere know one is going to hear. Dani
When I get my TRANS UNION REPORT...I'm going to dispute the FARMERS INSURANCE INQUIRY AS "FRAUD"... "Although I do business with FARMERS INSURANCE, I did NOT apply for any loan or credit card, and the premium is PAID IN FULL BEFORE COVERAGE STARTS"
George, I would seriously go after them for $1000 per each unpermissible inquiry. Did they tell you they were going to pull the report? I have gotten to the point that 9 times out of 10 I will not do business with a company that requires a credit report to establish a business relationship with me. The cable company wanted to pull my report just a couple months ago to see if my credit was worthy enough for them to send me a bill each month! Give me a break. I refused to give them my SSN and he said then they would have to bill it to my CC each month. Not a problem - I need the cashback money. But, we need to speak with our wallets (the only language they understand). And for those that do pull unauthorized inquiries we need to go after them (the creditors). If they have to write out a couple hundred $1000 checks each week maybe they will get the message. Dani
I've been with FARMERS for 20+ years...they started with "SOFT" a few years ago... They notify everybody that they can or do "PULL"...BUT NOT A "HARD"!!!
The thing is, Insurance inquiries ARE usually permissable...because whenever you sign an application or get a quote online, if you read the small print, you're usually agreeing to let them pull your credit.
1*Because we don't have good sense just like we don't have when dealing with creditors in the credit industry! 2*The same goes with for credit issues! ====================================
Once more, when they ask to pull your credit report, say no. Everyone assumes they have to say yes. If they want your business they will figure out a way. If they don't, forget them. I have had Alltel for 6 years, added a line for my Mom to use, they wanted to pull, I said "never mind, then." The girl called her manager, and they agreed to let me have the extra line without pulling credit. Geico will not pull if you say no, and they will give you preferred rates if your driving record is good, even if they can't pull credit.
My auto insurer pulled my credit when signed up 2 yrs ago. I didn't know they were pulling my credit until I started doing credit repair and saw the hard inquiry. Now here is the stupid part. My credit has gotten a whole lot better and my premiums have decreased. But guess what? My driving record is worse! I've had 3 tickets the past 2 yrs!
A lot of insurance agents/CSR's who give out the quotes do not ask because they are using software that cannot even give you a quote without pulling credit. They (supposedly) have been advised of the law, seem to disregard it. Also, the disclosure is often couched in terms that do not make it clear, IMO. Theings like "we may obtain a consumer report...." - it does not actually ask. If you hear those words you must stop them right then. And I know people in the industry who will do it anyway!! As consumers become more and more aware of credit and scoring, they are objecting more and more. It's the only way to change things. So, make an issue of it!!
I don't understand... Why do the insurance professionals on this board "buy into" the company line when it comes to insurance credit scoring?? If we don't accept the "standard reply" about everything else involving credit, why should we accept it about insurance and credit? Some of the comments posted in the past seem to imply that consumers can do nothing to change things. I don't believe that is the case. It is like everything else we challenge - it can be changed. Collectively we have tremendous power to change things - even insurance underwriting. I think if an insurance company has checked your credit without the required disclosure, you should fight back every way you can think of. Dispute the inquiry, contact your state's AG, complain to the FTC - all the ways we usually fight back.
Re: I don't understand... Perhaps we should all get several Quotes and sue for all the violations. If they had to pay for all the violations and still not sell any of the polices they may be interested in changing their policy.
Re: I don't understand... I'm still waiting for my TRANS UNION report in the mail so I can "SEE" if my FARMERS INSURANCE is really a "HARD"...(NOT~WORTHKNOWING showed "HARD") I WILL DISPUTE IT AS "FRAUD"...I do business with that company but PAY IN FULL BEFORE COVERAGE STARTS AND DID NOT APPLY FOR ANY CREDIT CARD OR LOAN"
Re: I don't understand... The FCRA Sect.604 states: (c) Furnishing reports in connection with credit or insurance transactions that are not initiated by the consumer. (1) In general. A consumer reporting agency may furnish a consumer report relating to any consumer pursuant to subparagraph (A) or (C) of subsection (a)(3) in connection with any credit or insurance transaction that is not initiated by the consumer only if  (A) the consumer authorizes the agency to provide such report to such person; or  (B) (i) the transaction consists of a firm offer of credit or insurance;  (ii) the consumer reporting agency has complied with subsection (e); and  (iii) there is not in effect an election by the consumer, made in accordance with subsection (e), to have the consumer's name and address excluded from lists of names provided by the agency pursuant to this paragraph There have been several lawsuits,including a pending class-action suit in Cal. against State Farm on this subject.(this was on car ins. where a poor credit record son was part of the household.) To date,the FCRA rule of allowing a credit report inquiry upon making an insurance application has been upheld.You can refuse permission for the inquiry,but the insurance company can also refuse to insure you if you do so.
