Posted On: January 30, 2008, 7:41 am CST

Posted By: Ratemaker

Wudchuck, if you can find ONE insurer in Michigan who is actually using salary to rate, I invite you to sue them. Salary is not included in any of the "off-the-shelf" major credit models insurers use. A credit model has to be approved by the regulators in any state that it's used in, and I guarantee Michigan's Commissioner wouldn't have let that bombshell through.

As for "cud have just recently filed bankruptcy and now my credit is great,' in most models, a recent bankruptcy destroys your credit rating, both for insurance purposes and for obtaining a new loan.

As for the common misconception of "credit vs. driving history," it's not a choice to use one or the other. Both tools supplement each other. Over 90% of the market has a clean driving history. Scoring helps predict FUTURE PERFORMANCE among this group.

As for accidents showing up on the MVR, Comp claims don't. Out of state accidents don't. There are all sorts of things that don't show up on the MVR. Both tools have problems, but are the best that are available.

And no one is arguing that bad credit CAUSES someone to file a claim. Do a little research on causation vs. correlation before you spout off about rating tools. A powerful, consistent correlation is all that's needed to use data as a rating variable.