Insurance companies are guilty until proven innocent. Facts presented will not matter in this type of meeting, only the feeling that something must be wrong. Same garbage over and over. Tiresome. I wonder why any top line insurance company even cares about Florida business anymore.
Any reason why none of the start up FL based carriers that the OIR is so proud of didn’t get an invite to talk about this subject? Anyone think for a minute that they don’t use the same criteria to underwrite their policies as the bigger companies?
Agreed. It will only get worse as more people begin to experience credit troubles. Some legislators have been dying to get rid of the credit underwriting variable and there’s no better time than now to address this with the public.
“Response to federal and state studies that have determined that the use of credit scores and models have a disparate impact on certain classes of people.”
Maybe instead of questioning insurance companies about why that is the case they should loos at the “certain classes of people” and give them remedial classes in how to manage money, pay bills, and read credit applications.
The use of credit is not designed to weed-out certain undesireable “classes of people”, it’s used as a proven predictor of the loss exposure of an underwriting segment.
This is so rediculous! What’s Obama’s credit score? Although I don’t like him I’m sure he’s managed to maintain a pretty decent credit score, is that only because his mother was white? I bet if he was 100% black he’d have a messed up credit score, right?
The assumption that a minority is going to have a lower credit score is insulting to those “classes of people” who have managed to maintain good credit – obviously overcoming the incredible forces which would naturally cause them to have poor credit.
People need to realize that a credit score may not reflect the tendencies of the person. Insurance companies have no procedures for correcting erroneous information sold to them. Only the policy holder loses out. I happen to know my credit history is mingled with 3 other people. I have spent the last 5 years trying to have the credit bureaus correct it, to no avail. So why should I be penalized by Insurance companies when they buy garbage?
Credit card companies are cutting limits, and cutting off cards with no balance. That destroys a credit score. I’ve had two limits cut in half and one card account closed. Because I wasn’t using it. Just because I didn’t max out every card I have my credit score dropped. I went from using 32% of my available credit to 68% from it. So now my insurance rates should go up for that?
So the bank disaster that is creating the loss of millions of jobs and an economic disaster now gets to move on to the next victims- US again.
Yes Dawn I’ve even had some companies cut my credit limits bringing my score down. I’ve looked at the internal correlation studies that many insurance companies use and it is true that credit and claims go hand in hand. It’s also true that many of those in the lower realm are afraid to file claims based on rate increases or potential rate increases.
Frankly I’m of the firm belief that your auto insurance rate needs to be made up of your driving record, claims history (all claims regardless of fault), driving experience, and garaging location of the vehicle. To use anything else is not sound in my opinion.
Our companies direct bill experience has been, insureds who don’t pay their bills on time have a very significantly high loss ratio. This is an excellent indicator. How can it be that our experience and all the independent studies that support those numbers are bull? There is no logic in your position.
In all my years in this industry I have never seen an auto insurance application or Home owners application that ask what race the insured was. So how can the use of credit be a racist factor unless a particular race has inherently lower credit scores than another.
I think that the credit scoring will change substantially based on the mear fact that many peoples scores are lower and they will seek out carriers that do not use credit. Thus the other carriers will need to adjust the credit models (which does not require a rate filing) or they will see volume drop.
So how do we get a new Governor and Insurance commissioner?
Sure, if you want to include internal payment history as well, I’m OK with that. External credit is subject to too many errors and too many factors beyond the consumers control.
Especially now, credit scores should be valued as the total junk they are. Identity theft is on a massive rise- thousands of victims in a matter of minutes these days. Companies are cutting limits, raising interest, making sure credit scores drop.
And since they’ve discovered that the companies that do ratings aren’t exactly on the straight and narrow *cough cough* who can believe one thing that they say?
Try the credit score of anyone that has been in the path of a natural disaster. Yes, you can get late fees or interest rate hikes cancelled, but it still shows late payments. Dragging down the score because you physically couldn’t make the payments.
If they want to do a fair evaluation of my payment history, fine. I haven’t missed one payment since 10/05 (Hurricane Wilma- for which I have 8 late payments in one month).
But to look at a number based on some formula that no one will divuldge that some other person made up and some other person was dumb enough to buy into?
More crooked standards from the people who have perfected crooked.
So now credit scores are useless for everyone Dawn? Sorry, but that’s just not true. The facts are there for you, whether you buy into the system or not. These are filed formulas taking into account all the things the insurance departments wanted in them. The are filed and approved. They are accurate and work. It’s too bad you buy into the bull that insurance scoring opponents put out.
No, I’ve just watched my credit score drop almost 100 pts in 6 months. Credit cards cut my limits for no reason. Two cards that had $0 balances on them were cancelled due to ‘inactivity’. The LOC on my house was cut. (keep in mind that even if I’d taken the entire amount out I’d be at 75% of the current value of my house)
I literally went from using under 32% of my available credit to over 68%. That KILLS a credit score.
I still have a job, I still make all my payments, I still do everything I’m supposed to. So you’re saying that I should pay higher premiums for basically NO REASON? Again, the responsible people get punished?
And, no, I don’t believe they are above reproach. I believe industry manipulation goes on, just like any other financial industry.
You can state your ‘facts’ all you want. Standard & Poor & Moody stated theirs, too. And we all know how that ended up. Experts using an unknown formula that the entire world bought into. yeah. right. Got my vote of confidence.
Scoring apponents have nothing to do with it. It’s called the real world and real life experience that I listen to.
Too bad you buy into the bull that the financial industry has programmed into you.
Hey Nobody, we had a discussion on this once before in a Michigan Thread. You claim that auto insurance can only be discounted by credit. You can actually go to the insurance department’s website to see the sham base rates that these people let get through. I particularly love the 66 year old retired couple in Wyandotte whom Progressive Michigan’s rate is $5,167 for a single auto with no tickets or accidents. My only point is it’s a VERY flawed system and in no case would that rate be considered sound.
The problem here is that Dawn (and others) site single examples or personal experiences when talking about a group or class of individuals in the thousands.
I have pretty poor credit due to some circumstances outside of my control and know I pay more for insurance (as well as the financing of my automobile) but understand that in the larger scope, when looking at 10’s of thousands of people needed for accurate statistics that the group I fit into poses certain risks.
Yes Dawn, you’re likely negatively affected which may or may not be an accurate predictor of YOUR risk but when you’re put in with 10,000 other people in a similar situation patterns begin to emerge.
The same holds true if you live in downstate NY. You might be the most responsible driver with a mind that would never concieve of fraud – that doesn’t matter, market segmentation means you’re going to pay more for insurance because of the other 10k people who live in your zip code.
Market segmentation does not look at the individual. It looks at a cageory. When you toss a dozen individual market characteristics together you begin to get at the individual. Credit is only one tool used to determine a rate based on your loss potential.
Actually, Nobody was completely correct in the case of Michigan’s underwriting (as far as I know MI is the only state the statement you quote would apply though).
In MI you cannot surcharge a policy, only discount it – and that’s not just credit, that’s across the board. You start with the highest premium possible then apply discount after discount after discount until you get to the final rate.
No, I buy into my company’s experience. I work for a large insurer with a totally above the board reputation. Insurance scoring is not a credit score. They are figured differently. If you choose to believe that these companies are manipulating the results that’s just your opinion. The facts are different. It’s just too bad that the anti scoring crowd try to manipulate your emotions through false logic. Too bad for the majority of insureds who receive discounts based on credit scores who will have to pay higher premium due to these falsehoods. Get off the bit about all of these companies being crooks. It’s a load of bull. The real crooks are not in the insurance industry. We didn’t cause the problems in the economy. Even the AIG problems were not insurance related. Learn the facts before spouting off.
you’re not keeping up with current events. Credit card companies are in a position that they have to raise more capital- so they are raising interest rates across the board and cutting credit limits to keep their ratio lower.
check out world news. Not just me. thousands of people are having their credit cards create havoc on their credit scores.
Auto insurance in Michigan is high because of the unlimited PIP. The insurance scoring methods are scientific and approved by the insurance department. Where is the trickery? Stop with the garbage about all insurance companies being crooks. The people I know are decent people doing a good job. Your ignorance is showing.
Dawn, credit scores are not insurance scores. Study the topic before posting please. I certainly would never defend the credit card companies. They do seem like the cheats and liars you seem to think insurance people are.
This is a Florida thread can we keep Michigan out of it.
Obama visited our state first and he will fix everyones credit and that will fix the problem for insurance rates.
Seriously folks, do you see the common denominator with all of the problems in Florida insurance, they seem to stem from our regulators office. we must go back to an elected official so we can boot the a55hole out when he does stupid stuff like run off the last national carrier (State Farm). Let them raise rates 75% for all I care, if they are still cheaper at least we have a sound and solvent carrier to pay the claims, if they are not cheaper then consumers will shop to find the better rate and the free enterprise system works as it should. Socialism and dictator mentality will kill us or at least leave us with nothing.
JR, these threads take their own direction. I didn’t bring up Michigan. Lighten up. I agree with your comments on the situation in Florida. It’s a political mess because the general population has bought into the lies.
When you reply to a post, read the whole thing before typing.
I never said insurance agents were the crooks. I have stated repeatedly basing premiums on figures that come from questionable means (meaning the credit score companies) is wrong.
Credit scores are the topic here. The companies that provide these credit scores are questionable at best. Therefore their data is subject to inaccuracies and slanted opinions.
Sorry Dawn, I got a bit caught up in the thread and went a little overboard. If credit scores are generally invalid, what do you propose we use now? Whether you agree with the validity of the scores, all studies, including the ones that claim discrimination, agree that insurance scores directly correlate to the likelihood of filing claims. I fail to see the fallacy here. Businesses of all kinds now depend on these supposedly invalid scores. Credit, insurance, employment and probably other decisions are made based on these scores. That cat is already out of the bag. (it’s early and I can’t think of another descriptive phrase) Just because you don’t like the system doesn’t mean it’s invalid. This is one you and I will have to disagree on, respectfully from my end.
I made the suggestion that driving history, experience, claims history (all claims), garaging location, and yes even internal payment history should be used to determine a rate. Leave external credit alone. And sure, since we’ve already sold our souls as an industry to big brother…you know the company I speak of…add payment history to the CLUE. Then you can use INSURANCE payment history from ALL carriers rather than external credit.
Mr. Solvent, not a bad idea but doesn’t that bring us back to the same arguement. CLUE reports are often not accurate just like credit reports are not accurate and we’ll still get the same story from insureds like: “it’s not my fault I paid Allstate late because I was getting a divorce or I had medical bills” or “I have never had a wreck so what does ot matter if I paid late a few times”.
The fact is that credit scoring must have some validity or companies wouldn’t be spending the time & money to fight like hell to keep it.
It really comes down to the same story just like everything else in this country – Those that take a responsible, prudent approach to their life will subsidize those that don’t. And yes there are exceptions to every rule. But insurance pricing isn’t really a business of “exceptions” is it?
You’re right, Nobody. We can respectfully disagree.
I do agree with Mr. Solvent – payment history is a valid determining factor.
We are at the tip of the iceberg, so to speak with this financial crisis. As I said before Moody was THE leading expert and above reproach. Until the last 9 months or so. We found out they are as crooked as the rest of them. IF the Gov’t ‘puts their money where their mouth is’ and weeds through the entire mess, I do believe they will find that at some level, they are all interconnected. And all have hands in each other’s pockets. From Paulson right on back to Equifax.
At some point, it all has to end. Besides, what are they going to do when ALL of our credit scores are driven down artificially? (meaning through limit cuts and account shut offs) Anything that can be manipulated to financial gain in the credit industry WILL BE. I think traditional credit scores as we know them are too subjective and archaic.
I do believe a huge change is coming. Do I know the answer? No. Do I think it will be better then what we have now? Again, I have no idea. But obviously the system we have now has failed miserably.
So Mr. Paranoid, all the studies that show a direct correllation between the insurance score and likelihood of filing claims are invalid because you don’t like them? All studies, including the ones that allege some type of discrimination, show correllation. Do numbers matter or just your feelings? Sell your soul? What a drama queen. I prefer to deal in facts rather than your feelings.
If the system has failed Dawn, why the statistical correllation? Maybe it hasn’t actually failed. There is a lot of bad information out there these days. Immitation facts.
You’re going to call me Mr. Paranoid when this particular company had already had multiple breaches, makes it impossible to correct errors, and knows most things about most people? Yeah, that’s paranoia and drama all right.
At one time, there most likely was a reliable correlation. I don’t dispute that. The information was reliable. Nothing is reliable in the credit industry anymore. Garbage into the system = garbage out. That’s why I say archaic.
Basically, any numerical score that is dependant on so many unknown factors is subject to slants, predjudices, opinions, etc. Immitation is your word, ITA with that. Who should have the authority to ‘weed out’ immitation from fact? Do you want some guy over in India that has been outsourced making decisions as to what is fact or fiction regarding your life? Or even some guy here that stands to make a bonus/commission on charging you higher interest rates/premiums because of immitation facts?
You’ve lost me on your train of thought here. I agree that the credit companies are doing some basically wrong things these days, but are we now going to discount all credit transactions? In my opinion this is just bad information based on urban myths. Too much internet opinion being put forth as fact. Tough to sort out the facts from the garbage any more. Fact is, the correlation is relevant until proven otherwise. These hearings, in addition to political show trials, are to determine if changes do need to be made. The real question will be if the hearing was for show or these politicians actually want to do fact finding. I vote for political show.
You’re not as lost as you think with my train of thought. ;-)
It will be a political show.ITA with that as well.
Hard to sort out garbage anymore. That’s the bottom line.
No, discounting all credit transactions isn’t the answer. Payment history is valid. The problem doesn’t start with the carriers. It starts with where they get their information.
We know it’s garbage these days. Until the system itself can get the ‘garbage’ cleared out, it makes everything they say suspect. If a company insists on using credit scores, then there should be safeguards in place. The applicant deserves the right to answer to any and all information included in the decision. IF a company feels that is too much of a ‘hassle’, then that company should forfeit the right to use credit scores.
Unless I am mistaken, individuals do have all of those rights, they just don’t want to bother with them. Most of the states appear to have some safeguards built in. I don’t really know if I am correct on that assumption. By the way Dawn, you and I have disagreed on some issues in the past, but mostly agree. I think you would agree Florida politics is a show, not reality.
Oh, yeah. Political show. Complete with lights, cameras, bells and whistles. David Copperfield couldn’t put on a better illusion. ;-)
The safeguards are for show- there are supposed to be laws and deadlines in place but they really don’t mean anything. My opinion is that if an underwriter rates according to credit reports, they should notify the applicant WHAT in that credit report led to that decision and the result of that decision. Then the applicant has the right to contact the underwriter with any pertinent information. Full disclosure. No hiding behind vague statements that might be based on immitation facts.
That sounds fine, but practically speaking you are talking nightmare. How do you know which things in the report to take off or discount? Now every bank, credit card issuer, insurance company, employer and anyone else using these reports has to verify the validity of each individual item. Sounds like a logististical nightmare to me. I think this has to be done by working with the credit reporting agencies. That’s their job.
If they did their jobs and people followed the rules/laws, we wouldn’t be having this conversation. The general consensus is ‘not my problem’.
Like I said – at one time the information was reliable. It’s not now, and anyone using that data should be required to give the person affected the option to respond. Maybe if it was such a logistic nightmare, something would happen to clean up the garbage.
Did you know that one medical bill that goes into collections (even if insurance eventually paid it) can hit your credit report over 3 dozen times in the span of 20 years? It’s not legal, but it happens. Every time it hits, there goes your score. YOU have to be the one to a. find out about it, b. file a notice with all three credit bureaus, c. hope they do their jobs.
Buying debt it big business now. Everytime a company buys debt, they can attempt to collect by any means possible. Including attaching credit reports. I recently had a hospital bill from 1992 show up again. Not only was the bill eventually paid, the statute of limitations for credit report was over 10 years ago. That’s why I did the research and found out why it happened. I also found out there isn’t a lot you can do about it. Just keep checking and keep fighting. Because people don’t want to do their jobs.
Once you’re a victim of ID theft, you’re never in the clear. It’s a game. They keep attaching your credit because they hope that you’ll eventually get tired of fighting and pay it.
Again, limit cuts and dormant account closures has no bearing on your ability to pay, but it does lower your credit score.
When is the last time you pulled your credit report? And you can’t get your score without paying for it. ?????? If that number is so clear cut, why can’t you get it with your report? If it has an adverse effect on a consumer, why can’t that consumer be given specifics?
The solution to this is, find a company that doesn’t use credit scores. I think there are some that don’t. I can’t say I really know if that’s still true. I’m still talking about insurance scoring, not credit scores. You can get your credit report for free once a year. I’ve done this myself. Your insurance score is different and is the secret formula you object to.
The debate in Fla is regarding credit scoring. Using the reports from Equifax, TRW, and TransUnion as factors to rate policies.
I thought credit scores were somehow tied into insurance scores? I could be wrong on that. I’m not an underwriter. Again, how reliable is that information as well?
I believe that the normal credit score is not included. Our company uses the credit information along with other factors for our own algorithm. I’m certainly no actuary so I don’t even know if the terminology is being used correctly, but I do know that our insurance score is a bit different than a credit score. More factors.
Question- do you have absolute faith in the information that is being provided for your company to us? Beyond a doubt that it is correct, and not up to human error or interpretation? If it was your policy/premium being effected, are you confident that the information that they are using is a genuine reflection of your risk?
In every single case of course not. As a tool it works based on large numbers. There is always a chance of some errors when dealing with large numbers. I do know that the company I work for is as above board as any company in the industry. I would tell you who that is but I would have to kill you since I am actually supposed to be working.
Insurance companies are guilty until proven innocent. Facts presented will not matter in this type of meeting, only the feeling that something must be wrong. Same garbage over and over. Tiresome. I wonder why any top line insurance company even cares about Florida business anymore.
Any reason why none of the start up FL based carriers that the OIR is so proud of didn’t get an invite to talk about this subject? Anyone think for a minute that they don’t use the same criteria to underwrite their policies as the bigger companies?
Agreed. It will only get worse as more people begin to experience credit troubles. Some legislators have been dying to get rid of the credit underwriting variable and there’s no better time than now to address this with the public.
“Response to federal and state studies that have determined that the use of credit scores and models have a disparate impact on certain classes of people.”
Maybe instead of questioning insurance companies about why that is the case they should loos at the “certain classes of people” and give them remedial classes in how to manage money, pay bills, and read credit applications.
The use of credit is not designed to weed-out certain undesireable “classes of people”, it’s used as a proven predictor of the loss exposure of an underwriting segment.
This is so rediculous! What’s Obama’s credit score? Although I don’t like him I’m sure he’s managed to maintain a pretty decent credit score, is that only because his mother was white? I bet if he was 100% black he’d have a messed up credit score, right?
The assumption that a minority is going to have a lower credit score is insulting to those “classes of people” who have managed to maintain good credit – obviously overcoming the incredible forces which would naturally cause them to have poor credit.
People need to realize that a credit score may not reflect the tendencies of the person. Insurance companies have no procedures for correcting erroneous information sold to them. Only the policy holder loses out. I happen to know my credit history is mingled with 3 other people. I have spent the last 5 years trying to have the credit bureaus correct it, to no avail. So why should I be penalized by Insurance companies when they buy garbage?
To use credit scores right now is complete bull.
Credit card companies are cutting limits, and cutting off cards with no balance. That destroys a credit score. I’ve had two limits cut in half and one card account closed. Because I wasn’t using it. Just because I didn’t max out every card I have my credit score dropped. I went from using 32% of my available credit to 68% from it. So now my insurance rates should go up for that?
So the bank disaster that is creating the loss of millions of jobs and an economic disaster now gets to move on to the next victims- US again.
Yes Dawn I’ve even had some companies cut my credit limits bringing my score down. I’ve looked at the internal correlation studies that many insurance companies use and it is true that credit and claims go hand in hand. It’s also true that many of those in the lower realm are afraid to file claims based on rate increases or potential rate increases.
Frankly I’m of the firm belief that your auto insurance rate needs to be made up of your driving record, claims history (all claims regardless of fault), driving experience, and garaging location of the vehicle. To use anything else is not sound in my opinion.
Our companies direct bill experience has been, insureds who don’t pay their bills on time have a very significantly high loss ratio. This is an excellent indicator. How can it be that our experience and all the independent studies that support those numbers are bull? There is no logic in your position.
In all my years in this industry I have never seen an auto insurance application or Home owners application that ask what race the insured was. So how can the use of credit be a racist factor unless a particular race has inherently lower credit scores than another.
I think that the credit scoring will change substantially based on the mear fact that many peoples scores are lower and they will seek out carriers that do not use credit. Thus the other carriers will need to adjust the credit models (which does not require a rate filing) or they will see volume drop.
So how do we get a new Governor and Insurance commissioner?
Sure, if you want to include internal payment history as well, I’m OK with that. External credit is subject to too many errors and too many factors beyond the consumers control.
Especially now, credit scores should be valued as the total junk they are. Identity theft is on a massive rise- thousands of victims in a matter of minutes these days. Companies are cutting limits, raising interest, making sure credit scores drop.
And since they’ve discovered that the companies that do ratings aren’t exactly on the straight and narrow *cough cough* who can believe one thing that they say?
Try the credit score of anyone that has been in the path of a natural disaster. Yes, you can get late fees or interest rate hikes cancelled, but it still shows late payments. Dragging down the score because you physically couldn’t make the payments.
If they want to do a fair evaluation of my payment history, fine. I haven’t missed one payment since 10/05 (Hurricane Wilma- for which I have 8 late payments in one month).
But to look at a number based on some formula that no one will divuldge that some other person made up and some other person was dumb enough to buy into?
More crooked standards from the people who have perfected crooked.
So now credit scores are useless for everyone Dawn? Sorry, but that’s just not true. The facts are there for you, whether you buy into the system or not. These are filed formulas taking into account all the things the insurance departments wanted in them. The are filed and approved. They are accurate and work. It’s too bad you buy into the bull that insurance scoring opponents put out.
No, I’ve just watched my credit score drop almost 100 pts in 6 months. Credit cards cut my limits for no reason. Two cards that had $0 balances on them were cancelled due to ‘inactivity’. The LOC on my house was cut. (keep in mind that even if I’d taken the entire amount out I’d be at 75% of the current value of my house)
I literally went from using under 32% of my available credit to over 68%. That KILLS a credit score.
I still have a job, I still make all my payments, I still do everything I’m supposed to. So you’re saying that I should pay higher premiums for basically NO REASON? Again, the responsible people get punished?
And, no, I don’t believe they are above reproach. I believe industry manipulation goes on, just like any other financial industry.
You can state your ‘facts’ all you want. Standard & Poor & Moody stated theirs, too. And we all know how that ended up. Experts using an unknown formula that the entire world bought into. yeah. right. Got my vote of confidence.
Scoring apponents have nothing to do with it. It’s called the real world and real life experience that I listen to.
Too bad you buy into the bull that the financial industry has programmed into you.
Hey Nobody, we had a discussion on this once before in a Michigan Thread. You claim that auto insurance can only be discounted by credit. You can actually go to the insurance department’s website to see the sham base rates that these people let get through. I particularly love the 66 year old retired couple in Wyandotte whom Progressive Michigan’s rate is $5,167 for a single auto with no tickets or accidents. My only point is it’s a VERY flawed system and in no case would that rate be considered sound.
The problem here is that Dawn (and others) site single examples or personal experiences when talking about a group or class of individuals in the thousands.
I have pretty poor credit due to some circumstances outside of my control and know I pay more for insurance (as well as the financing of my automobile) but understand that in the larger scope, when looking at 10’s of thousands of people needed for accurate statistics that the group I fit into poses certain risks.
Yes Dawn, you’re likely negatively affected which may or may not be an accurate predictor of YOUR risk but when you’re put in with 10,000 other people in a similar situation patterns begin to emerge.
The same holds true if you live in downstate NY. You might be the most responsible driver with a mind that would never concieve of fraud – that doesn’t matter, market segmentation means you’re going to pay more for insurance because of the other 10k people who live in your zip code.
Market segmentation does not look at the individual. It looks at a cageory. When you toss a dozen individual market characteristics together you begin to get at the individual. Credit is only one tool used to determine a rate based on your loss potential.
Actually, Nobody was completely correct in the case of Michigan’s underwriting (as far as I know MI is the only state the statement you quote would apply though).
In MI you cannot surcharge a policy, only discount it – and that’s not just credit, that’s across the board. You start with the highest premium possible then apply discount after discount after discount until you get to the final rate.
Michigan Underwriting 101.
No, I buy into my company’s experience. I work for a large insurer with a totally above the board reputation. Insurance scoring is not a credit score. They are figured differently. If you choose to believe that these companies are manipulating the results that’s just your opinion. The facts are different. It’s just too bad that the anti scoring crowd try to manipulate your emotions through false logic. Too bad for the majority of insureds who receive discounts based on credit scores who will have to pay higher premium due to these falsehoods. Get off the bit about all of these companies being crooks. It’s a load of bull. The real crooks are not in the insurance industry. We didn’t cause the problems in the economy. Even the AIG problems were not insurance related. Learn the facts before spouting off.
you’re not keeping up with current events. Credit card companies are in a position that they have to raise more capital- so they are raising interest rates across the board and cutting credit limits to keep their ratio lower.
check out world news. Not just me. thousands of people are having their credit cards create havoc on their credit scores.
Auto insurance in Michigan is high because of the unlimited PIP. The insurance scoring methods are scientific and approved by the insurance department. Where is the trickery? Stop with the garbage about all insurance companies being crooks. The people I know are decent people doing a good job. Your ignorance is showing.
Dawn, credit scores are not insurance scores. Study the topic before posting please. I certainly would never defend the credit card companies. They do seem like the cheats and liars you seem to think insurance people are.
This is a Florida thread can we keep Michigan out of it.
Obama visited our state first and he will fix everyones credit and that will fix the problem for insurance rates.
Seriously folks, do you see the common denominator with all of the problems in Florida insurance, they seem to stem from our regulators office. we must go back to an elected official so we can boot the a55hole out when he does stupid stuff like run off the last national carrier (State Farm). Let them raise rates 75% for all I care, if they are still cheaper at least we have a sound and solvent carrier to pay the claims, if they are not cheaper then consumers will shop to find the better rate and the free enterprise system works as it should. Socialism and dictator mentality will kill us or at least leave us with nothing.
JR, these threads take their own direction. I didn’t bring up Michigan. Lighten up. I agree with your comments on the situation in Florida. It’s a political mess because the general population has bought into the lies.
When you reply to a post, read the whole thing before typing.
I never said insurance agents were the crooks. I have stated repeatedly basing premiums on figures that come from questionable means (meaning the credit score companies) is wrong.
Credit scores are the topic here. The companies that provide these credit scores are questionable at best. Therefore their data is subject to inaccuracies and slanted opinions.
Sorry Dawn, I got a bit caught up in the thread and went a little overboard. If credit scores are generally invalid, what do you propose we use now? Whether you agree with the validity of the scores, all studies, including the ones that claim discrimination, agree that insurance scores directly correlate to the likelihood of filing claims. I fail to see the fallacy here. Businesses of all kinds now depend on these supposedly invalid scores. Credit, insurance, employment and probably other decisions are made based on these scores. That cat is already out of the bag. (it’s early and I can’t think of another descriptive phrase) Just because you don’t like the system doesn’t mean it’s invalid. This is one you and I will have to disagree on, respectfully from my end.
I made the suggestion that driving history, experience, claims history (all claims), garaging location, and yes even internal payment history should be used to determine a rate. Leave external credit alone. And sure, since we’ve already sold our souls as an industry to big brother…you know the company I speak of…add payment history to the CLUE. Then you can use INSURANCE payment history from ALL carriers rather than external credit.
Mr. Solvent, not a bad idea but doesn’t that bring us back to the same arguement. CLUE reports are often not accurate just like credit reports are not accurate and we’ll still get the same story from insureds like: “it’s not my fault I paid Allstate late because I was getting a divorce or I had medical bills” or “I have never had a wreck so what does ot matter if I paid late a few times”.
The fact is that credit scoring must have some validity or companies wouldn’t be spending the time & money to fight like hell to keep it.
It really comes down to the same story just like everything else in this country – Those that take a responsible, prudent approach to their life will subsidize those that don’t. And yes there are exceptions to every rule. But insurance pricing isn’t really a business of “exceptions” is it?
You’re right, Nobody. We can respectfully disagree.
I do agree with Mr. Solvent – payment history is a valid determining factor.
We are at the tip of the iceberg, so to speak with this financial crisis. As I said before Moody was THE leading expert and above reproach. Until the last 9 months or so. We found out they are as crooked as the rest of them. IF the Gov’t ‘puts their money where their mouth is’ and weeds through the entire mess, I do believe they will find that at some level, they are all interconnected. And all have hands in each other’s pockets. From Paulson right on back to Equifax.
At some point, it all has to end. Besides, what are they going to do when ALL of our credit scores are driven down artificially? (meaning through limit cuts and account shut offs) Anything that can be manipulated to financial gain in the credit industry WILL BE. I think traditional credit scores as we know them are too subjective and archaic.
I do believe a huge change is coming. Do I know the answer? No. Do I think it will be better then what we have now? Again, I have no idea. But obviously the system we have now has failed miserably.
Just an opinion.
So Mr. Paranoid, all the studies that show a direct correllation between the insurance score and likelihood of filing claims are invalid because you don’t like them? All studies, including the ones that allege some type of discrimination, show correllation. Do numbers matter or just your feelings? Sell your soul? What a drama queen. I prefer to deal in facts rather than your feelings.
If the system has failed Dawn, why the statistical correllation? Maybe it hasn’t actually failed. There is a lot of bad information out there these days. Immitation facts.
You’re going to call me Mr. Paranoid when this particular company had already had multiple breaches, makes it impossible to correct errors, and knows most things about most people? Yeah, that’s paranoia and drama all right.
At one time, there most likely was a reliable correlation. I don’t dispute that. The information was reliable. Nothing is reliable in the credit industry anymore. Garbage into the system = garbage out. That’s why I say archaic.
Basically, any numerical score that is dependant on so many unknown factors is subject to slants, predjudices, opinions, etc. Immitation is your word, ITA with that. Who should have the authority to ‘weed out’ immitation from fact? Do you want some guy over in India that has been outsourced making decisions as to what is fact or fiction regarding your life? Or even some guy here that stands to make a bonus/commission on charging you higher interest rates/premiums because of immitation facts?
Actually, it is paranoia and drama. My opinion based on no facts and figures like yourself.
You’ve lost me on your train of thought here. I agree that the credit companies are doing some basically wrong things these days, but are we now going to discount all credit transactions? In my opinion this is just bad information based on urban myths. Too much internet opinion being put forth as fact. Tough to sort out the facts from the garbage any more. Fact is, the correlation is relevant until proven otherwise. These hearings, in addition to political show trials, are to determine if changes do need to be made. The real question will be if the hearing was for show or these politicians actually want to do fact finding. I vote for political show.
You’re not as lost as you think with my train of thought. ;-)
It will be a political show.ITA with that as well.
Hard to sort out garbage anymore. That’s the bottom line.
No, discounting all credit transactions isn’t the answer. Payment history is valid. The problem doesn’t start with the carriers. It starts with where they get their information.
We know it’s garbage these days. Until the system itself can get the ‘garbage’ cleared out, it makes everything they say suspect. If a company insists on using credit scores, then there should be safeguards in place. The applicant deserves the right to answer to any and all information included in the decision. IF a company feels that is too much of a ‘hassle’, then that company should forfeit the right to use credit scores.
Unless I am mistaken, individuals do have all of those rights, they just don’t want to bother with them. Most of the states appear to have some safeguards built in. I don’t really know if I am correct on that assumption. By the way Dawn, you and I have disagreed on some issues in the past, but mostly agree. I think you would agree Florida politics is a show, not reality.
Oh, yeah. Political show. Complete with lights, cameras, bells and whistles. David Copperfield couldn’t put on a better illusion. ;-)
The safeguards are for show- there are supposed to be laws and deadlines in place but they really don’t mean anything. My opinion is that if an underwriter rates according to credit reports, they should notify the applicant WHAT in that credit report led to that decision and the result of that decision. Then the applicant has the right to contact the underwriter with any pertinent information. Full disclosure. No hiding behind vague statements that might be based on immitation facts.
That sounds fine, but practically speaking you are talking nightmare. How do you know which things in the report to take off or discount? Now every bank, credit card issuer, insurance company, employer and anyone else using these reports has to verify the validity of each individual item. Sounds like a logististical nightmare to me. I think this has to be done by working with the credit reporting agencies. That’s their job.
If they did their jobs and people followed the rules/laws, we wouldn’t be having this conversation. The general consensus is ‘not my problem’.
Like I said – at one time the information was reliable. It’s not now, and anyone using that data should be required to give the person affected the option to respond. Maybe if it was such a logistic nightmare, something would happen to clean up the garbage.
Did you know that one medical bill that goes into collections (even if insurance eventually paid it) can hit your credit report over 3 dozen times in the span of 20 years? It’s not legal, but it happens. Every time it hits, there goes your score. YOU have to be the one to a. find out about it, b. file a notice with all three credit bureaus, c. hope they do their jobs.
Buying debt it big business now. Everytime a company buys debt, they can attempt to collect by any means possible. Including attaching credit reports. I recently had a hospital bill from 1992 show up again. Not only was the bill eventually paid, the statute of limitations for credit report was over 10 years ago. That’s why I did the research and found out why it happened. I also found out there isn’t a lot you can do about it. Just keep checking and keep fighting. Because people don’t want to do their jobs.
Once you’re a victim of ID theft, you’re never in the clear. It’s a game. They keep attaching your credit because they hope that you’ll eventually get tired of fighting and pay it.
Again, limit cuts and dormant account closures has no bearing on your ability to pay, but it does lower your credit score.
When is the last time you pulled your credit report? And you can’t get your score without paying for it. ?????? If that number is so clear cut, why can’t you get it with your report? If it has an adverse effect on a consumer, why can’t that consumer be given specifics?
The solution to this is, find a company that doesn’t use credit scores. I think there are some that don’t. I can’t say I really know if that’s still true. I’m still talking about insurance scoring, not credit scores. You can get your credit report for free once a year. I’ve done this myself. Your insurance score is different and is the secret formula you object to.
The debate in Fla is regarding credit scoring. Using the reports from Equifax, TRW, and TransUnion as factors to rate policies.
I thought credit scores were somehow tied into insurance scores? I could be wrong on that. I’m not an underwriter. Again, how reliable is that information as well?
I believe that the normal credit score is not included. Our company uses the credit information along with other factors for our own algorithm. I’m certainly no actuary so I don’t even know if the terminology is being used correctly, but I do know that our insurance score is a bit different than a credit score. More factors.
I learned something today, so thank you for that.
Question- do you have absolute faith in the information that is being provided for your company to us? Beyond a doubt that it is correct, and not up to human error or interpretation? If it was your policy/premium being effected, are you confident that the information that they are using is a genuine reflection of your risk?
Just curious.
In every single case of course not. As a tool it works based on large numbers. There is always a chance of some errors when dealing with large numbers. I do know that the company I work for is as above board as any company in the industry. I would tell you who that is but I would have to kill you since I am actually supposed to be working.
LOL
It’s been an interesting debate.
Have a good afternoon.
Absloutely, thanks.