Why would it surprise anyone that low to moderate income individuals, whether black, hispanic or white, would have lower credit scores and higher claim activity than older, medium to high income individuals? Why wouldn’t they have more difficulty paying their bills on their income and have a need to file claims that those in the other catagory can occasionally ‘self-insure’. Is there a flaw in the conclusion?
So are you saying that the individual who self insures his small claims should subsidize the person who is turnng in claims if that person is a low to moderate income individual?
It is not a flaw, it is merely a fact that effects the claim experience, which in turn effects profitability. The other side of the coin is that the wealthier insured’s claim will cost more money as it involves more costly property, a fact accounted for by that person’s higher premium for their higher limit of insurance.
My point: I am white, have medium income, a very low credit score–had insurance with SF 40 years–two accidents, yet if for some reason I left and tried to come back in a couple of years, I wouldn’t be able to get in very easily. Credit scores don’t tell all the difficulties a person has been thru, but yet has paid thier bills and did not declare bankruptcy.It truly is an unfair system to some, and SF has a lot of old-time “excellent policyholders on the books with very low credit scores, who if they walked in off the street today, would not be able to get ins at a good rate.
If a person maintains their financial affairs (i.e. pays their bills) they are showing responsibility and ownership. That simply correlates that the person is likely to maintain their home and car in a similar manner. Hence, they have a sense of pride, ownership and responsibility and will take extra steps and care to prevent things from happening which will likely result in fewer claims.
To clarify–I believe you would want a HIGHER credit score, higher being better.
Exactly my point, Carolyn. My spouse has been in lending for nearly 40 years and gone from being VP of a small private bank to working for Citicorp and he can tell you that credit scores do NOT encompass who and what an individual truly is. It only makes everyone a number and lumps a lot of very different individual and circumstances together under one ‘label’.
Certainly makes jobs easier for underwriters and pretty much eliminates the need for loan officers and a brain! I think it is disgusting that our society has no regard or ability to distinguish the character of an individual but depends on numbers and slots.
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Why would it surprise anyone that low to moderate income individuals, whether black, hispanic or white, would have lower credit scores and higher claim activity than older, medium to high income individuals? Why wouldn’t they have more difficulty paying their bills on their income and have a need to file claims that those in the other catagory can occasionally ‘self-insure’. Is there a flaw in the conclusion?
So are you saying that the individual who self insures his small claims should subsidize the person who is turnng in claims if that person is a low to moderate income individual?
It is not a flaw, it is merely a fact that effects the claim experience, which in turn effects profitability. The other side of the coin is that the wealthier insured’s claim will cost more money as it involves more costly property, a fact accounted for by that person’s higher premium for their higher limit of insurance.
My point: I am white, have medium income, a very low credit score–had insurance with SF 40 years–two accidents, yet if for some reason I left and tried to come back in a couple of years, I wouldn’t be able to get in very easily. Credit scores don’t tell all the difficulties a person has been thru, but yet has paid thier bills and did not declare bankruptcy.It truly is an unfair system to some, and SF has a lot of old-time “excellent policyholders on the books with very low credit scores, who if they walked in off the street today, would not be able to get ins at a good rate.
If a person maintains their financial affairs (i.e. pays their bills) they are showing responsibility and ownership. That simply correlates that the person is likely to maintain their home and car in a similar manner. Hence, they have a sense of pride, ownership and responsibility and will take extra steps and care to prevent things from happening which will likely result in fewer claims.
To clarify–I believe you would want a HIGHER credit score, higher being better.
Exactly my point, Carolyn. My spouse has been in lending for nearly 40 years and gone from being VP of a small private bank to working for Citicorp and he can tell you that credit scores do NOT encompass who and what an individual truly is. It only makes everyone a number and lumps a lot of very different individual and circumstances together under one ‘label’.
Certainly makes jobs easier for underwriters and pretty much eliminates the need for loan officers and a brain! I think it is disgusting that our society has no regard or ability to distinguish the character of an individual but depends on numbers and slots.