Posted On: November 29, 2006, 9:25 am CST

Posted By: Mark

You're right, it doesn't have to do with how people drive. But, it does correlate with how often they FILE CLAIMS. If you have someone with very poor credit, and a $500 loss, they are more likely to file it under insurance than someone with very good credit and cash on hand - they're going to pay for it out of pocket to avoid using insurance. That is a prediction, and it makes perfect sense. I'm an agent in Texas, and I can definately tell you in my book of business there IS a correlation there in home and auto insurance. My good credit customers pay on time, I never have to rewrite a policy because of non-pay, and they file few claims. It costs an insurance company money to rewrite policies and have habitually late payers, a well as claims paying. It's only fair that those costs are recovered.

Besides, if we didn't use credit, do you realize the giant rate increase the "good credit" people are going to have? You'll get more complaints than compliments, I assure you of that.