I would say it would be fair that wealthy people in Florida pay a higher amount dollar-for-dollar for insurance on their homes because of the likelihood that it has a closer proximity to water because the truth is that it has a higher probability of sustaining damage.
Yea and by your reasoning if those same wealthy people with high priced homes in a potential dangerous environment; but not necessarily so, pay that premium then IF THEY SCORE LOW on the CREDIT APPLICATION- a tool used for underwriting purposes…supposedly, then, they would pay more for that premium. Get that buck factor up there is the job. Advocating low credit scores to claims is vodoo economics at best. And yea, I have done my homework and even better have worked these scenarious in real life for multiple P&c COMPANIES. Actually, homework has nothing to do with this quandry; just money and definitiely not equity. IMHO.
As an accountant I can make the numbers show just about any theory as a fact. We\’ve had this discussion adnusem so there is no sense arguing about it. If your credit report was wrong (reports show 30% have errors) and you were charged more then we may hear a different arguement from you. Do you also believe that your educational background somehow has a correlation to your driving record? Many companies are now using that as an underwriting \”tool\” also. Let\’s face facts, credit and education are only used to redline, nothing more.
JR – you are so wrong on so many levels. Do you even work in the insurance industry? Maybe you do but being a mail boy for an insurance carrier doesn\’t mean you understand how it works.
Chrystal,
I am an Insurance Agent and in my opinion you are right.
I have a customer who has a perfect driving record who just got a $200.00 per year rate increase because he went into a local Target store and purchased a fairly expensive item and was offered a 10% discount if he made the purchase with a Target credit card and he did as most of us would,he opened the account immediately and due to his 800+ score received a $10,000 credit limit,made the purchase and the same day paid off the balance.Guess what?his insurance score dropped 2 tiers and by the way he showed me his 2005 report and his 2006 report and this was the ONLY change.It is evident that something is wrong when we have to worry about a rate increase every time we buy something.
This sounds like Communism and for the Agents who thinks this is fair could it be because the more the Insured pays the more you make.
I think if we treat people fairly the rest will take care of itself
I don\’t work in insurance nor do I claim to be an expert in any facet of this problem. I do however have some very strong opinions. I was under the impression that a credit score determined how likely a person is to pay their debt: i.e. a car loan, mortgage, rent, credit cards, etc. Silly me. And last time I checked a person would file an insurance claim when they get in an accident. (if there is something else someone would file a claim for someone please enlighten me because I am apparently missing out on some money.) So the solution to this could either be similar to utilities (a deposit required and they won\’t have to check your credit) or you can pay your entire six month/one year bill up front and they won\’t have to worry about a person defaulting on their payment. That seems to me how credit should work… that\’s how everyone else uses it anyway. So the insurance companies claims about the link between credit and filing a claim must really be about the notion that people with bad credit get in more accidents? Or poor people get in more accidents? Or this is just another way for the insurance industry to make many more millions this year? Any way you skew this it is wrong. My insurance increased my rates when I was rear-ended because it \”shows a pattern\”!!! I didn\’t file a claim… her insurance paid for it. What we really need is a consumer advocate independent of the government and the insurance lobby to stand up for us, and who will be accountable to us. This is politics and capitalism at its worst… any way to screw the little guy.
A Public Adjuster works on a commission basis. This is what motivates the adjuster to get as much for his/her client as the policy allows. This explains why insurance companies hate public adjusters.
I believe the credit scoring process is a method used by insurers to \”cherry pick\” their customers in order to effectively cross cell more high end products such as securities, life insurance, long term care, commercial insurance and other more profitable products. Also it is a way for the big insurers to squeeze more money out of the poor. The poor are used to be walked on like a rug. So there cries are ignored. Look at who is fighting the illegal and immoral war in Iraq. The poor and middle class. While Dick Cheney and his republican pals get more wealth.
We have updated our privacy policy to be more clear and meet the new requirements of the GDPR. By continuing to use our site, you accept our revised Privacy Policy.
I would say it would be fair that wealthy people in Florida pay a higher amount dollar-for-dollar for insurance on their homes because of the likelihood that it has a closer proximity to water because the truth is that it has a higher probability of sustaining damage.
Yea and by your reasoning if those same wealthy people with high priced homes in a potential dangerous environment; but not necessarily so, pay that premium then IF THEY SCORE LOW on the CREDIT APPLICATION- a tool used for underwriting purposes…supposedly, then, they would pay more for that premium. Get that buck factor up there is the job. Advocating low credit scores to claims is vodoo economics at best. And yea, I have done my homework and even better have worked these scenarious in real life for multiple P&c COMPANIES. Actually, homework has nothing to do with this quandry; just money and definitiely not equity. IMHO.
As an accountant I can make the numbers show just about any theory as a fact. We\’ve had this discussion adnusem so there is no sense arguing about it. If your credit report was wrong (reports show 30% have errors) and you were charged more then we may hear a different arguement from you. Do you also believe that your educational background somehow has a correlation to your driving record? Many companies are now using that as an underwriting \”tool\” also. Let\’s face facts, credit and education are only used to redline, nothing more.
JR – you are so wrong on so many levels. Do you even work in the insurance industry? Maybe you do but being a mail boy for an insurance carrier doesn\’t mean you understand how it works.
Chrystal,
I am an Insurance Agent and in my opinion you are right.
I have a customer who has a perfect driving record who just got a $200.00 per year rate increase because he went into a local Target store and purchased a fairly expensive item and was offered a 10% discount if he made the purchase with a Target credit card and he did as most of us would,he opened the account immediately and due to his 800+ score received a $10,000 credit limit,made the purchase and the same day paid off the balance.Guess what?his insurance score dropped 2 tiers and by the way he showed me his 2005 report and his 2006 report and this was the ONLY change.It is evident that something is wrong when we have to worry about a rate increase every time we buy something.
This sounds like Communism and for the Agents who thinks this is fair could it be because the more the Insured pays the more you make.
I think if we treat people fairly the rest will take care of itself
I don\’t work in insurance nor do I claim to be an expert in any facet of this problem. I do however have some very strong opinions. I was under the impression that a credit score determined how likely a person is to pay their debt: i.e. a car loan, mortgage, rent, credit cards, etc. Silly me. And last time I checked a person would file an insurance claim when they get in an accident. (if there is something else someone would file a claim for someone please enlighten me because I am apparently missing out on some money.) So the solution to this could either be similar to utilities (a deposit required and they won\’t have to check your credit) or you can pay your entire six month/one year bill up front and they won\’t have to worry about a person defaulting on their payment. That seems to me how credit should work… that\’s how everyone else uses it anyway. So the insurance companies claims about the link between credit and filing a claim must really be about the notion that people with bad credit get in more accidents? Or poor people get in more accidents? Or this is just another way for the insurance industry to make many more millions this year? Any way you skew this it is wrong. My insurance increased my rates when I was rear-ended because it \”shows a pattern\”!!! I didn\’t file a claim… her insurance paid for it. What we really need is a consumer advocate independent of the government and the insurance lobby to stand up for us, and who will be accountable to us. This is politics and capitalism at its worst… any way to screw the little guy.
A Public Adjuster works on a commission basis. This is what motivates the adjuster to get as much for his/her client as the policy allows. This explains why insurance companies hate public adjusters.
I believe the credit scoring process is a method used by insurers to \”cherry pick\” their customers in order to effectively cross cell more high end products such as securities, life insurance, long term care, commercial insurance and other more profitable products. Also it is a way for the big insurers to squeeze more money out of the poor. The poor are used to be walked on like a rug. So there cries are ignored. Look at who is fighting the illegal and immoral war in Iraq. The poor and middle class. While Dick Cheney and his republican pals get more wealth.