Auto Insurance Discounts Based On Credit Rating

[Doc Tinker]

On the news they have been talking about insurance companies offering rate discounts based on credit ratings. They say that when the insurance companies started doing the new discounts, they also increased their rate base. So, in effect, they are charging more for those who have poor credit.



In the state of Michigan, all drivers are required by law to have insurance. With this new rate discount scheme, do you think the Michigan law is unconstitutional?



Doc

 

[lschultz]

Doc what station you watching?I have not seen that on the news. There gonna get there money there nothing free anymore. If they are charging more for people that have not that good of a credit rating that is not right in my book. Ever body suppose to have insurance here but. Back when I had my 91 I was going home one morning when I saw a truck ahead of me with a truck on its flatbed as I got closer to it the hood flew off and bounced and and took part of my grill out. I don't even think the fellow was gonna stop but I got on his a** and he stopped. He gave me his insurance card and I got the info but when I called they told me he did not have insurance. He took out a 6 mos. policy but after he got the card he canceled it. So I went back to his shop later and confronted him. He did pay for a new grill. Told me he would put it in for me. No thanks I did it myself.

 

[apkole]

Doc,



I don't know about the constitutionality of this, but I do know that insurance co. s have been doing this for a few years now. There is also a "CLUE" factor which enters into the scheme of things. No matter where you shop your insurance, you are asked to request this report from your current ins. carrier. It is a claims history report. As Paul Harvey would say, "You can run but you can't hide. " Your claims history follows you wherever you go.



One additional little thing to add here: There is some evidence that some ins. companies record inquiries about potential claims (i. e. does this damage meet my deductible) even though no claim is filed. This goes into your CLUE experience, an can have a negative impact when attempting to shop for a better rate.



For my businesses, if the damage is under 1000, I just eat it rather than run the risk of not being able to get insurance for a reasonable rate.



Andy