How even good credit can be used against you…

ORLANDO, Fla. — Could a small change in your credit report trigger a big increase in your car insurance bill? An Orlando man claims he has a great credit score but when he had a minor change his premium jumped by nearly $1,000 a year.
Action 9’s Todd Ulrich investigated how that could happen and what you can do about it.
No matter how safe he is at the wheel, Bruce Sahroian feels the insurance company finds a way to drive up rates.
Sahroian’s proof is his latest insurance renewal from Progressive.
“It was a $75 a month increase, which added up to a nearly $900 a year increase,” said Sahroian.
Sahroian said he complained and was told his credit score triggered the rate hike.
“I think they’re using it just as an excuse,” said Sahroian.
Sahroian showed Action 9 his score of 774, rated as excellent, and he claims there was only one big change last year, which was that he refinanced a loan.
“Why do they need to know my credit score in the first place? They received all their payments,” said Sahroian.
Using credit scores to change car insurance rates can be controversial. It’s banned in six states and restricted in others.
Consumer groups like United Policyholders said credit reports can contain mistakes and even with good scores a minor change can cause hikes.
On the other side are the insurance associations that pushed through legislation in Florida to include credit scores.
The industry argues that drivers with lower scores are more likely to file claims. And using credit scores can reward lots of drivers with lower rates.
Sahroian said he’s now shopping for a new insurer.
“I got a quote significantly lower that what I was paying,” he said.
Ulrich talked to Sahroian a short time ago and he just changed to a new company at a much lower premium.
Progressive did review the issue and said credit scoring is used for rates and benefits most customers.

The information presented in this publication is for general informational purposes and is not a substitute for legal advice. If you have a specific legal issue or problem, United Policyholders recommends that you consult with an attorney. Guidance on hiring professional help can be found in the “Find Help” section of United Policyholders does not sell insurance or certify, endorse or warrant any of the insurance products, vendors, or professionals identified on our website.

Date: July 21, 2024