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Credit Scores Found To Double Home Insurance Rates

By Sally Maison
Published: Sunday, May 2nd, 2010

CULTRF-00015693-001Most insurance companies that need help in assessing risk and determination of premium costs in Canada are now turning towards their credit scores.

Many people saw a rise in the premiums after the insurance companies decided to consider the credit scores said the market place, CBC-TV.

Since many other insurance companies took this step of determining premiums so as to calibrate risk, so did the cooperators being the largest Canadian insurance company.

They said that the only way to predict future claims of property and the safest way is the credit scores. Casualty insurance also stands as an indicator for rating logically for home insurance. It is said by the correspondence that a credit score is nothing but how a person handles the responsibilities and performing financial obligations right on time.

 Insurers say by keeping credit scores as a consideration for providing loans, actually increases the responsibility of people so as to maintain high scores. And those who have high scores will know themselves that they are much benefited.

The cooperators state that by having high credit scores, it is known that the claims for loans would be less hence the Canadians would actually be subsidizing for those who are likely to have future claims.

Some residents claim that although they have being performing their obligations exactly the way they are supposed to, now they feel like all their efforts have gone down the drain  with them fighting with insurance companies that just don’t respond.

For those single parents, who earn well but need to cover up house hold expenses and take care of children, it is one difficult job to get a good credit score especially when insurance premiums almost double up!

The insurance companies and cooperators defend themselves saying that credit scores are not forced out of the customers. But those who keep it private might have to give higher rates.

They say that if the customer wants to keep his credit score a private matter, they respect it but they say that the best rates cannot be provided to them in this case.

Renny was asked for permission by the u k based home insurance company called aviva stating that this could give him best rates and discounts. After the claim was made that is 15 years ago, he hasn’t got one yet.

He said that if the claim was worth hundred dollars, his privacy equaled it. and this actually brought down his home insurance rate by 200 dollars.

“Those that can least afford it will pay more. Those that can afford it because they’ve got good credit rating will pay less,” said Carroll. “We hope it never gets there”.

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