I feel its profiling or discriminating for insurance co to use credit to determine rates,is it?

Question

have perfect driving record but pay top dollar for my auto ins. I'm 48 yrs old lost credit standing because of wifes medical. do you think I should start a class action suite cause somehow this is truely unfair, maybe discriminating and profiling me?

Answer 1

I think you can try a lawsuit saying there is no correlation with your type of credit issues and high claims rates. You would need to back it up with stats. Most people with bad credit do not have good income or just don't pay bills. Its the irresponsibility factor that worries insurance companies. If you can prove your type of credit issues should not impact your risk, you might have an argument. You should sit down with a few attorneys to get a legal opinion though.

Answer 2

It is not discrimination. Insurance companies use a variety of criteria to determine risk, credit history is one of those criteria. The insurance company has found that people with poor credit history are more likely to make claims on their insurance than people with good credit history. This would suggest that they need to charge people with poor credit history more. They do the exact same thing with smokers. The insurance companies have known for decades that smoking was bad for your health. Smokers have more medical problems and die at a younger age; therefore, they pay higher premiums on their health and life insurance.

Answer 3

No it is not because you are required to pay a premium to them at a time other than the enactment of the policy, therefore you acquire insurance on a credit basis.

Answer 4

What makes you think it is your credit standing. More likely it is your medical insurance that is causing you the problem on your other insurance.

Have you tried to get quotes from other insurers?