Quote:
Originally Posted by tophcfa
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.
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I believe it to be a scam because people are unable to have a mortgage without insurance, I believe it to be a scam because state legislatures have made car insurance mandatory. I believe it to be a scam because the insurance industry used its power to convince legistatures & mortgage banks to comply with the insurance companies best interests. I also believe that insurance companies gladly take premiums, but frequently do everything they can to avoid making payments. I am not making a value judgement as to whether people should or should not have house & car insurance. So now that insurance companies have made it imperative to have insurance (sold by them), they use credit ratings to raise premiums, yeah, I do see your point, but I will continue to consider it a dirty business.