Bad Credit Score? Your Insurance May Cost Higher
Insurance premiums correspond to the level of risk being insured. One of the criteria used by insurers to assess this risk is credit information. Although the relationship between insurance and credit score may not be obvious at first glance, there is a correlation between credit score and the number of claims.
In fact, the 10% of people with the lowest scores make up to twice as many claims. Credit score information is therefore a relevant indicator for your insurer. In Quebec, most insurance companies use this data.
Can the Insurer Demand Access to your Credit Information?
No. You can refuse your insurer access to your credit score. If you refuse, no insurance company can refuse to insure you or renew your contract on this basis alone.
So What do I Gain by Allowing my Insurer to Access my Credit Report?
While people with poor credit scores make more claims, the reverse is also true. Good financial discipline, in addition to protecting you from the unexpected, is a sign that you are able to maintain your insured property and prevent it from deteriorating. If you have a good record, you could get a better deal from your insurer.
Key Points to Remember
- You are not required to provide access to your credit information
- Access to your file does not affect your credit
- If you have a good credit history, you could get a better price
For More Information
Here are some organizations that can provide you with information on insurance and credit scores: