Will the credit ban impact my earthquake insurance rates?
No, earthquake insurance policies do not use credit as a rating factor.
No, earthquake insurance policies do not use credit as a rating factor.
No, flood insurance policies do not use credit as a rating factor.
This credit ban was implemented with short term notice as an emergency order. The emergency order currently lasts for 120 days and the Insurance Commissioner is trying to extend the order for 3 years. All indications are that the intent is for this credit ban to be a permanent change in Washington state. Please keep in mind that the Insurance Commissioner is an elected official in Washington state. We encourage you to share any feedback with your State Senator here or with the Insurance Commissioner’s office here.
We sincerely hope not. That number has been thrown out by a number of different insurance carriers as a worst case scenario, presumably for their clients with the highest credit scores. To put it another way, at least a couple companies give up to 80% discounts for the high credit scores which means for those clients, rates would increase by 80% once their credit score discount is removed from their policy. With that said, very few clients are getting maximum credit score discounts or maximum credit score surcharges. All clients in Washington state will be impacted in some way by this credit score ban but that impact could vary from a significant reduction in rates, basically no change at all, or a significant increase in rates. The [...]
This ban is specific to Washington state policies only.
Not unless you are starting a brand new insurance policy on 6/20/21. For renewal policies, rates will begin to be impacted by the credit score ban for policies processed on or after 6/20/21. Different companies process renewals on different timelines anywhere from 30 to 60 days in advance. So the earliest renewal policies to be impacted by the ban will be policies renewing on 7/20/21 or later. A good rule of thumb is if you received your policy renews prior to 6/20/21, then the credit ban is not yet impacting your rates. If you receive your renewal paperwork after 6/20/21 then the credit ban is likely impacting your rates.
We don’t know. We the insurance agent have never been able to actually see your credit score when quoting insurance. We know that credit is a rating factor that can either decrease rates for clients based off credit score discounts or increase rates for clients based on credit score surcharges but we have no way of knowing to what extent each client is impacted. Credit score discounts/surcharges are different for each client and vary greatly amongst insurance carriers. What we do know is that that Washington state law now dictates that all insurance companies remove all credit related discounts/surcharges from their rating model. So if your policy is one that was being surcharged due to your credit score, your insurance premiums will improve. If your policy is [...]