Credit scores and car insurance: if you don’t succeed, try again
News from Fox Business:
Three congressmen recently proposed a bill that would eliminate credit scores from the list of factors used by car insurers to determine rates.
The bill, H.R. 6129, titled the Ban the Use of Credit Scores in Auto Insurance Act, would amend the Fair Credit Reporting Act so that reports on consumer credit can’t be used in the underwriting process. It was sponsored by Reps. Hansen Clarke (D-Mich.), John Conyers Jr. (D-Mich.) and Bennie Thompson (D-Miss.) and was referred to the U.S. House of Representatives Financial Services Committee
“The cost of insurance for everyday people is simply too high,” Clarke said in a July 16 post on his Facebook page. “We have to end insurance rating factors that are unfair. Companies penalizing citizens for their credit score and other ‘redlining’ practices must end.”
Michigan’s car insurance premiums rank as the country’s third most expensive, with 2012 models averaging $ 2,013 a year. Mississippi came in at No. 19 at $ 1,502, according to a Quadrant Information Services analysis of insurance rates.
Conyers, in a July 12 Facebook post, said, “Auto insurance rates should be based on your skills and responsibility behind the wheel, not extraneous factors outside your control.”
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