why do insurance companies check credit?
July 17, 2010 - 1:03 pm
why does my credit affect my driving
Your credit does not affect your driving, any more than your age affects your driving.
But the data shows that your credit score is actually a more accurate predictor of your future losses, than your driving history.
The lower your credit score, the more claims you are likely to file, and the larger those claims will be.
WHY? Who knows. The insurance companies don’t care, it doesn’t MATTER. It doesn’t matter WHY 16 year old boys have more accidents.
All that matters, is that there IS a direct corrolation between credit score and claims – and they can use that as a rating factor, accordingly.
July 17th, 2010 at 6:36 pm
It does affect whether or not they can be confident you will pay the prmium on time.
References :
July 17th, 2010 at 7:03 pm
Your credit does not affect your driving, any more than your age affects your driving.
But the data shows that your credit score is actually a more accurate predictor of your future losses, than your driving history.
The lower your credit score, the more claims you are likely to file, and the larger those claims will be.
WHY? Who knows. The insurance companies don’t care, it doesn’t MATTER. It doesn’t matter WHY 16 year old boys have more accidents.
All that matters, is that there IS a direct corrolation between credit score and claims – and they can use that as a rating factor, accordingly.
References :
July 17th, 2010 at 7:27 pm
People with bad credit have more claims and cause more problems.
References :
July 17th, 2010 at 7:48 pm
Your credit indicates whether you are a careful, responsible person who does not do risky things like borrow money that you cannot repay or drive too fast, or a reckless person who does do risky things like borrow money that you cannot repay or drive too fast.
Your credit affects whether you are going to need to fake an accident to get the insurance money to pay your creditors. (In New Jersey, as much as half of all money paid on insurance claims was fraudulent at one time.)
References :