I had this happen with my auto insurance (not Geico). What I'd like to know is, what the heck does my auto insurance risk rating have to do with my credit report especially if I pay my insurance policy in full and on time?

There are great drivers with bad credit, bad drivers with great credit and everything in between. This is just another way for them to charge you more and make more money. Greed. I hope they choke on it.

 

I doubt that they are checking your credit report to see if you will pay your bills... it's easy enough to look at your payment history for that. I'd be willing to bet that a team of data miners have discovered that as credit risk increases, so does your risk of causing an accident. Think about it... if you have a higher credit score, you probably drive a safer car that is better maintained and you are probably more conservative as well... more risk averse... probably older too. It's younger people (less driving experience, generally) with lower credit scores... and those struggling financially, so the car might not be as well maintained (weaker brakes, etc), and more likely to cause an accident.

Of course these are all broad generatlizations, but that's how they build actuarial tables... trying to compute the average risk of a payout based on easily quantifiable numbers like age, binary questions (smoker? yes/no) or a numeric score.

 

Don't you know that people with bad credit are crappy drivers too? I mean, there's scientific proof! Well, actually, there isn't. But there are a bunch of high-paid lobbyists that convince our government officials this is good for business to draw false corralaries (sp?). (bad for consumers, but who cares about consumers?!)

Yet another effect of the conglomeration of american business tactics. it won't be long before, when my physical comes back saying i have cancer, that my credit cards are canceled. It was funny in the early 80's on "SOAP", but way to close to true on our 21st century.

There's got to be something consumers can do to stop this kind of bull*** but I like many, don't even know where/who to complain to.

FWIW, I saved 20% on *my* car insurance my switching to Wawanesa!

 

True, but correlation doesn't always imply causation. I bet there's a pretty tight correlation between unemployment and illiteracy, too, but that doesn't mean that if I lost my job tomorrow, I'd also forget how to read and write.

It just seems to me that the link between credit rating and accident/claim risk is pretty tenuous compared to oh, I don't know - the insured's driving record??

 

i don't get TV in these parts so I don't know if that's a real slogan. If so, that's awesome!

 

I'm not saying that there is causation... just because you are a bad driver doesn't mean that you have a poor credit rating. I would, however, guaranty that Geico and/or other auto insurance companies are doing their best to find quantitative indicators of an average person's driving skill (where skill=fewer payouts for claims). The credit score is easily atainable and may show a very good correlation with driving skill (as defined above).

 

See this link... some interesting quotes from people in the insurance industry: http://www.smartmoney.com/consumer/i...story=20010820