Notice in Auto Insurance Bill

10 years ago

Seems the insurance companies have been 'found out' on using a person's credit reports to set their rates. Our State Farm car insurance bill contains a statement in teeny type that says they do this, and that if they can't see your reports, your rate is set using 'averages' of other insured drivers.

Our credit reports are frozen. No wonder our bill seems so high!

I've called our agent to see how this can be rectified. Maybe they can tell me *when* they want to look at our reports; I can 'un-freeze' for set periods or for only State Farm. I suppose I can obtain a copy of our report and send it to them, too.

What do you think?

Featured Answer

Elmer J Fudd

10 years ago

last modified: 10 years ago

Sorry nicole, I've never heard of Clark Howard. I googled and saw he was a talk show host. Sounds from your mentioning him that he's popular. I don't tend to find people on the radio talking about financial matters to be very interesting (and that's probably just because of my own background), maybe he's different. The example you cite sounds like the product of someone's imagination.

There's a big difference between something that could happen (ie, it's not impossible but has happened only in limited numbers) and something that's common and more likely. That's what that example sounds like to me, not impossible but also not common. My comment was that I know of credit rating freezes, I don't know if it's a good idea or not. This could very well be common knowledge to all the world but still something I don't know (I'm a CPA but did mostly corporate rather than individual work).

There's an ocean of stuff I don't know. I'll ask around on this topic and see what I find out. I'll look for when I can listen to this guy's show. Thanks for the info.

Sort by:Oldest

Comments (11)

socks
10 years ago
I think they will try to give you the brush-off. Let us know what happens. If your credit report has not changed much since they last accessed it, probably won't affect your rate.
User
10 years ago
My credit reports are frozen and my rates aren't high because of it.Maybe you should shop around for new insurance, I did....saved a $1000 on my primary home insurance this year. The reason my rate was high was because of the fire danger of living next to a dense wooded area. Some insurance companies don't care, some do.

http://www.consumer.ftc.gov/articles/0497-credit-freeze-faqs
Related Discussions
credit score/auto insurance
Q
Comments (6)
I got hit by the credit score problem last May on my car insurance. It did not matter that I had a high credit score my score had dropped because on the one credit card that I have I had more charged than the 7% of the credit amount which in this case was more than $1200. Waiting to see what the rate has been increased this time. Rate increased 5% but person at Credit reporting agency did not understand why I was upset since I still had a good score. Scores do not always mean anything.
...See More
Separate insurers for house and auto? Better to consolidate?
Q
Comments (27)
We ended up going with Citizens/Hanover. I was actually a little worried because I didn't know much about them, but I did some research on my own and found high reviews. They are also rated AA in the Best Book so we decided to give it a shot. In Michigan, if someone is injured or even has a heart attack in their car, the AUTO COMPANY is responsible for all the medicial bills. It's horrible and has raised our rates to unreasonable amounts; highest in the country actually. State Farm is notorious for not paying, fighting everything tooth and nail and for using very sneaky methods to get out of their obligations. They're going to be great for you until you have a claim or a problem. There is no charge from an insured to use a broker and it really took no time for them to compare rates with 15 different companies. It was 3 days from the day I first called, to the day I had policies in hand. Wonderful experience. I would highly recommend you give a broker a call, send them a copy of your deck sheets and let them see what they can do. There is no obligation, so really what do you have to loose?
...See More
Do you bundle your home and auto insurance?
Q
Comments (36)
Interesting Lascatax. The insurance was in our name (as owners), but we never lived there. We did not rent the house until a couple of years later. At that time we notified our insurance that the house would be a rental, and of course, the policy was written up as such. Our agent knew that when we first aquired and insured the house, that we would not be living there. Possibly something was written up in the policy at that time; I don't remember as that was several years ago. Same as bpath, my grandmother was in assisted living (policy in her name at that time). We had great renters for a few years, then they moved away. At that point, we were ready to sell. Even though we had great renters, being a landlord was not for me LOL.
...See More
Did anyone else's auto insurance take a big jump?
Q
Comments (44)
Very true Carol, cars are getting bigger and heavier. People are moving more to Trucks and SUV's and both are getting bigger. New model pickups are looking like billboards in the front and a fad similar to the fins on the cars in the 50's. Heavier too, the bigger size takes more materials, and electric cars weigh in at about 30% more than it's counterpart gas engine vehicle. You also have a good eye on those tires because they are getting bigger making those new huge cars look proportional. I got a big one, it's huge! The engine roars and tuned for performance, but when I wake up and look out the window all I see is a kia Rio.
...See More
Elmer J Fudd
10 years ago
last modified: 10 years ago
Is having a credit report freeze warranted or an over-reaction? Is it more trouble to have one or to not have one? If it's important, is there any jeopardy pulling it off for some period of time? I don't know.

I know about them, but I've never considered doing it for myself and I've never heard anyone talking about it. These mean nothing, maybe people I know have done it and simply haven't mentioned it. Maybe I'm an outlier?
marie_ndcal
10 years ago
Some people freeze their credit information due to identify theft or other legal reasons. As easy as it is to get information on people now, many are doing it to stop every one from finding out about your "life". Just found out today that even some charities are doing that especially if a person makes a large donation etc. Had a special seminar at the assisted living home and when I remember the origination that gave it, will report on that.

As to auto insurance? Mine dropped almost 100.00 when I moved from a small town to a bigger city--we can't figure that out. But I did change companies Many companies operate under several different names and it that way they find out way too much for me. Allstate does that.
User
10 years ago
last modified: 10 years ago
SnidelyWhiplash...the example Clark Howard used, yes his is frozen too. was a college student fraudulently gets a loan in your name for instance to pay for their college tuition. They don't owe the money until they graduate and they come after YOU. The money can be automatically taken out of your bank account for an over due loan, without your permission. Then YOU have to prove it wasn't you that took out the loan in order to get your money back. How about just skipping all THAT and no one, even yourself can take out a loan.

If you need a loan, then unfreeze the one agency the credit check will be run through, then refreeze it when the loan is complete. The fee for unfreezing is generally $9 for each of the 3 agencies.

Snidely....if you want to read more I furnished a link in my prior post.....
joyfulguy
10 years ago
Yuck.

o j
redcurls2
10 years ago
This isn't something new. MOST types of insurance check your credit..Auto and homeowner's especially.
chisue
Original Author
10 years ago
I'm sure this insurance company practice has been common -- but generally unknown to the public. I was surprised to get a notice in our auto insurance bill INFORMING me that State Farm does consider your credit rating when setting your rates. They stated that my DH's report was closed to inquiry, so they had used mine!

Years ago we applied for a store CC to save 10% on a large purchase. When the clerk ran my DH's soc. sec. number our report was incorrect, listing another name and another address! We contacted one of the reporting agencies to rectify it. (Partial success.) It was then that we decided it would be prudent to freeze.

I think we have 'unfrozen' on only two occasions since then -- simple to 'open' the record at one reporting agency for X hours and to only X company. We seldom require credit -- not opening new accounts for CC's or establishing utility service, etc. However, I had not thought about hiding our *good* credit causing us trouble. Now it's State Farm...what else?

The credit reports are so rife with errors -- that the report keepers refuse to correct -- that I wonder how *credible* they can be!
Elmer J Fudd
10 years ago
There was a thread discussing insurance companies and credit ratings not too long ago.

I checked with my own agent at that time and learned that my state (California) doesn't permit that practice. Obviously other states do.
cynic
10 years ago
last modified: 10 years ago
Been 'found out'? I've know about them doing it here for over a decade or more! LOL Nothing new. Nothing hidden. Mostly ignored by people who don't read their bills. (And yes, that includes me until I saw that tidbit.) What's more, if you put in a claim, you get a credit report pulled on you too, and that's before it's even submitted. As I recall they did a background check on you too, at least on claims. An associate of mine was a high-level insurance company investigator for a lot of years. You might be amazed at some of the stuff that goes on.

Notice in Auto Insurance Bill

Elmer J Fudd

Comments (11)

socks

User

Related Discussions

Elmer J Fudd

marie_ndcal

User

joyfulguy

redcurls2

chisue
Original Author

Elmer J Fudd

cynic

COMPANY

BUSINESS SERVICES

GET HELP

CONNECT WITH US

Notice in Auto Insurance Bill

Comments (11)

Related Discussions

chisueOriginal Author

COMPANY

BUSINESS SERVICES

GET HELP

CONNECT WITH US

chisue
Original Author