Quote:
Originally Posted by Dusty_Star
In the US there is frequently a huge difference in premium payments for insurance, for cars or houses, based on credit rating. Maybe even if the insurance company will cover someone. A scam, sure. But it exists.
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It’s not a scam, property and casualty insurance companies are in the business of profitably underwriting, pricing, and diversifying risk. Statistically significant data has proven that customers with lower credit scores are more likely to file tenuous claims and are therefore riskier to insure. Hence the higher premiums based on inferior credit scores. Without this credit based pricing adjustment, everyone would be charged higher premiums, effectively requiring those with better credit to subsidize others.