Applying credit scoring to rating and underwriting is not racist. Studies show only a small correlation between socioeconomic status and credit. People with strong credit tend to be more responsible and that attribute contributes to a lower amount of accidents for auto and better maintenance for their property. As a group, these people have more self control and a better sense of risk and reward.
Kreidler just needs to go. This will raise mine and everybodys insurance here. When I-5 isn’t traffic jammed, they treat it and the other Fed and State highways like a race course with no police anywhere! He has already gotten rid of all STM policies to make Washingtonians pay those ungodly Obamacare premiums. And he guts out about half of each carriers portfolio offering making WA a terrible place to do business. But the Dems here won’t pull their heads out of the sand long enough to realize the point you have made.
Our WA insurance commissioner actually made things worse when he mandated that every P&C policy that uses credit must be rescored every 3 years. For those folks who have had their personal credit score drop from such conditions as in today’s atmosphere, they will no longer be able to keep their previously earned score. Elderly folks fair worse yet, as many of them no longer use credit, but pay out of pocket – which in turn impacts their credit history. They may have gotten the best rate at one point, but as their need for credit diminished, so too their credit rating, resulting in increased rates. Perhaps our Washington state insurance administration should consider using Oregon’s model; no mandatory re-rating, and if the client does request the insurer to rescore their policies, the insurance company cannot increase the client’s rate due to a poorer stance, rather maintain the formerly earned status, or with improvement, reward the client.
Prior to implementation of credit scoring a company I worked for actually pulled all claims for the prior year & credit scored all of their insureds. They found the most claims and the most expensive claims came from people with the poorest credit scores.
Credit scoring does not eliminate the need for underwriters. It is another factor that helps determine better risks. A driver may have better skills, but be a poor risk because of carelessness or more risky behavior. Poor credit has a large correlation with that risky behavior.
I agree credit scores, which are a score to rank your worthiness to borrow shouldn’t be used in the rating of insurance; which should rank your risk as a driver/homeowner, etc. BUT there are relevant areas of overlap between what goes INTO a credit score and what goes INTO an insurance risk level. This data should still be fair game to use in insurance rating.
Applying credit scoring to rating and underwriting is not racist. Studies show only a small correlation between socioeconomic status and credit. People with strong credit tend to be more responsible and that attribute contributes to a lower amount of accidents for auto and better maintenance for their property. As a group, these people have more self control and a better sense of risk and reward.
Kreidler just needs to go. This will raise mine and everybodys insurance here. When I-5 isn’t traffic jammed, they treat it and the other Fed and State highways like a race course with no police anywhere! He has already gotten rid of all STM policies to make Washingtonians pay those ungodly Obamacare premiums. And he guts out about half of each carriers portfolio offering making WA a terrible place to do business. But the Dems here won’t pull their heads out of the sand long enough to realize the point you have made.
Our WA insurance commissioner actually made things worse when he mandated that every P&C policy that uses credit must be rescored every 3 years. For those folks who have had their personal credit score drop from such conditions as in today’s atmosphere, they will no longer be able to keep their previously earned score. Elderly folks fair worse yet, as many of them no longer use credit, but pay out of pocket – which in turn impacts their credit history. They may have gotten the best rate at one point, but as their need for credit diminished, so too their credit rating, resulting in increased rates. Perhaps our Washington state insurance administration should consider using Oregon’s model; no mandatory re-rating, and if the client does request the insurer to rescore their policies, the insurance company cannot increase the client’s rate due to a poorer stance, rather maintain the formerly earned status, or with improvement, reward the client.
Prior to implementation of credit scoring a company I worked for actually pulled all claims for the prior year & credit scored all of their insureds. They found the most claims and the most expensive claims came from people with the poorest credit scores.
Credit scoring was developed to get rid of Underwriters!! Nothing to do with driving skills!
Credit scoring does not eliminate the need for underwriters. It is another factor that helps determine better risks. A driver may have better skills, but be a poor risk because of carelessness or more risky behavior. Poor credit has a large correlation with that risky behavior.
I agree credit scores, which are a score to rank your worthiness to borrow shouldn’t be used in the rating of insurance; which should rank your risk as a driver/homeowner, etc. BUT there are relevant areas of overlap between what goes INTO a credit score and what goes INTO an insurance risk level. This data should still be fair game to use in insurance rating.