Well MA decided to switch to competitive auto insurance as of April 1, 2008.  I decided I would spend some time researching whether it is worth changing our insurance or not.   We are currently covered until August 2008, but if the rates were lower, it would be worth switching.  Of course there is the possibility that it could be higher.  But the plan is to give everyone 1 year to switch over from set rate polices to competitive insurance.

So I contacted a few insurance brokers and asked for rate quotes.  Most were happy to oblige.  But surprisingly all asked for my social security number.  Which I of course refused, but asked why?  They said they would be pulling my credit report and that of my DH’s to help determine our car insurance and home insurance rates.

Apparently it is now becoming part of the algorithim to determine how much of a risk you are depending on your FICO credit score. I was very uncomfortable with that and told them I have excellent credit.  And when I choose a person to work with then I’ll allow my credit score to be run.  However, until then I’ll be waiting.  They agreed but told me I would not get insurance until the credit report was pulled.

I was very surprised. But an insurance person on a message board said it’s because people with lower credit scores are likely to commit insurance fraud and were more careless drivers.  How they found these correlations I have no idea.

I knew that looking at a person’s credit score/report was becoming more common.  That every job DH and I have gotten in the past few years, has pulled our credit histories.  Apparently it makes a difference on the type of employee you’ll be. I do believe this is true, especially in jobs where you handle money.  The possibility of embezzlement or bribery could be present if you were in deep credit problems.

But now a good FICO score is becoming important in other areas of our lives.  I don’t think it’ll be possible soon to survive without a credit score/report.  To attempt to live without one might be detrimental to your future employment or getting insured.  So moral of the story?  Don’t go out and deliberately wreck your score.  Yes it’s not the most important thing, but to deliberately try to damage your score could cost you big.