The Truth About Car Insurance
By Norma Garcia on Friday, August 7th, 2015
Are you getting taken for a ride?
If you drive a car and buy auto insurance, here’s a “don’t miss” special report from Consumer Reports.
This in-depth two-year investigation is based on 2 billion price quotes involving 700 insurance companies in every ZIP code across the country. There is a lot of great information (all free) about how you can save money and some shocking revelations about how auto insurance works that everyone should know about.
Did you know that your credit score and other factors that have nothing to do with how well you drive can have a big impact on how much you pay for your auto insurance, EVEN IF you are a good driver? Learn more about the secret score behind your rates and check out the interactive map of the U.S. that shows in graphic detail the impact of credit scores on auto insurance prices. We found that if you have anything less than stellar credit, you pay more for your insurance, even if you’re a good driver. Can you believe that in many states a person with a drunk driving conviction but good credit can pay much less for their coverage than a safe driver with a clean record who has poor credit? In Florida, for example, a poor credit score can boost premiums by $2,417, but a drunken driving conviction boosts those premiums by only by $866. Where’s the logic and justice in that?
If you’re like most people, you’re probably wondering, “Wait, what does my credit have to do with how I drive?” You’re not the only one asking this question. Today, Eric Zorn, a columnist at the Chicago Tribune posed the same question and said, “What logic is there – what possible cause and effect –in the idea that a person with lousy credit is also likely to be a lousy driver?” They also note that there are other reasons to worry about insurance companies using our credit information to decide how much we should pay for our auto insurance. “Overall credit scores upon which the credit-based insurance score is based, are notoriously prone to error . . .[P]ricing formulas are opaque and proprietary . . .[and] it’s a handy proxy for income—and race-based discrimination in insurance, which is otherwise illegal.”
Oh, yes. There’s more. Among other things, Consumer Reports found that some insurance companies are penalizing drivers with higher rates if they think they’re not likely to shop around for a better deal. Could you be that customer who is getting penalized for your loyalty? Read the article and get informed.
Here’s the good news. You can do something with your outrage. Please sign our Petition demanding fairness in auto insurance. (Scroll until it appears). We’ll make sure that the 50 state insurance commissioners hear from all of us that we want to be priced mainly by how we drive and not by who insurance companies think we are. It’s time to #FixCarInsurance.