If I don’t Experience my score, and my score varies from company to company and day to day, how will I Know if my credit is affecting my Insurance purchases?
The FCRA requires an Insurance company to tell you if they have taken an “adverse action” against you, in whole or in part, because of your credit report information. If your company tells you that you have been adversely affected, they must also tell you the name of the national credit bureau that supplied the information so that you can get a free copy of your credit report. FCRA defines “adverse action” to include “…a denial or cancellation of, an increase in any charge of, or a reduction or other adverse or unfavorable change in terms or coverage or amount of, any Insurance Policy existing or applied for, in connection with the underwriting of Insurance Policy…”
Examples of an “adverse action” include:
- giving the consumer a limited coverage form
- not giving the consumer the best rate
- not giving the consumer a discount, or
- giving the consumer a surcharge
In addition, most state laws require insurers to provide clear and specific reasons for any refusal to issue, cancellation or non-renewal of an Insurance policy. A reason such as “bad credit score” may not be in compliance with most state laws. Insurance companies differ in how and when they notify consumers Around an adverse action. For example, notification could come either verbally or in writing from either the agent or the Insurance company, and notification could come at the first policy period or at each renewal. The best way to Know for sure if your credit score is affecting your acceptance with an insurer for the best policy at the best rate is to ask.
How can I improve my credit score if I have been adversely affected?
