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Homeowners Insurance and Credit


someonesomewhere
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Well, I got zinged on homeowners insurance. Got the policy today. They pulled ChoicePoint and cited adverse credit issues for not giving the best possible rates on homeowners insurance. State Farm.

I've submitted online requests from ChoicePoint, and I'm counting on inaccuracies there.

Washington State Insurance Commissioner's webpage had some useful info on credit and insurance.

http://www.insurance.wa.gov/factsheets/factsheet_detail.asp?FctShtRcdNum=16

http://www.insurance.wa.gov/publications/factsheets/credit_scoring.pdf

The insert citing ChoicePoint said if you've had job loss, divorce, medical, blah, blah, blah contact your agent for a review. Sorta pro-actively inviting you to ask them to show goodwill. Anyone tried and had success with State Farm?

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ChoicePoint tracks prior insurance claims. You should be able to access your reports online.

I made the request online, but they are mailing the results. ChoicePoint must track other stuff as well. Insert from insurance citing ChoicePoint reported:

Your premium was influenced by information from consumer reports:

  • Number of accounts opened in the last 12 months
  • Number of accounts ever 30 days late
  • Account with current delinquency reported
  • Average number of months open for all accounts

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Most do a soft pull on CR as well as the ChoicePoint C.L.U.E reports. The ChoicePoint reports have more weight than CR. It may list those reasons as why you're not getting the "best" price; however, in my experience CR doesn't have much of an effect.

Have you made any loss claims in the recent years?

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Unfortunately, they pull loss reports for ANY loss. Even not-at-fault accidents. Some states ban the practace of raising rates for not-at-fault losses. I know it sucks, but on the bright side, you're probably still better off sticking with the same company. Most of the time, switching companies with a loss reported will cause a larger premimum increase.

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Sometimes they cite it... but it didnt have any affect on the rate. Your agent can tell you if you got the best rate or not.

Progressive sent the disclaimer on my jet ski insurance(FYI big class action not long ago on all this w/ insurance companies and credit reports) - I got the best rate but they were doing a CYA and sending the disclaimer anyway about how it is used etc.

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My dh and I just recieved a letter from our insurance co. (American Family) that said they pulled our credit and we will not be getting the best rate for our homeowners ins. due to problems on our credit. I am concerned how much more they will be charging us for this. I have heard it from others that our premium could even double! What the heck? Anyone had any experience with this?

What can we do to avoid this? We really like the company we are with, and don't really want to have to switch.

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You don't have any recourse. Get a new insurance company if they employ this practice and are about to jack your rate. In fact, I suggest to everyone that they shop around annually. There are wide discrepancies with insurance rates.

With a BK7 in 2004, last year my car insurance rate with Progressive was $1300/year for $50k of LIABILITY ONLY and LIMITED TORT. This is state minimum insurance. This year, I switched to Liberty Mutual and my rate is $670/year for FULL TORT, $500k LIABILITY and FULL COLLISION. Plus, they wrote an additional $1,000,000 umbrella policy for $240 that covers additional liability related to two homes and two vehicles.

For a rental property, AllState quoted me $2700/year for multi-family dwelling homeowners. Liberty Mutual wrote the exact policy for $1150.

In short, SHOP AROUND. Rates can vary by a few hundred percent!

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As far as State Farm's CLUE report goes.. contact your agent and ask them to contact the underwriter to let them know there are major inaccuracies. Yes, credit aspects has some to do with it. They should re-review it once it is all fixed. It may take some effort to get someone to listen you.... but State Farm has some things in place for these situations.

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When I was fixing to close on my house, I asked my broker who was good with homeowners? He recommend a local agent for Allstate. The original homeowners insurance included in my good faith estimate was 2200 a year....wow.

My agent with allstate gave me a platinum package with sump pump added for $497 a year. They NEVER did any credit check on me.

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My agent with allstate gave me a platinum package with sump pump added for $497 a year. They NEVER did any credit check on me.
Allstate did a credit check on me when I applied for homeowner's. Their price was ridiculous. I guess it all depends on one's situation. I used them for the closing and then swapped policies about two weeks later.
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