Legislative committee to take testimony on credit-scoring bills

Letter to the Editor

Posted: Friday, March 28, 2003

Regarding credit scores and insurance rates, consumers should know that:

1. The credit scoring process is completely secret. No one knows what information is used or how it is weighted.

2. There is no proven correlation between credit scores and risk of loss. Credit scores are based on payment history, amount of debt, length of credit history, new applications and a mix of credit accounts and loans. What do those factors have to do with your driving record or claim history?

3. Secretly computed credit scores are also used by employers, to decide who to hire; utilities, in granting telephone, gas or electric accounts; Delta Airlines to profile passengers for potential terrorist risk!

Consumers affected most adversely by credit scoring are minorities, low-income groups, seniors and people who pay with cash.

If you need more information about credit scoring, please go to http://www.geocities.com/

insurance_credit_scoring/ and http://www.dced.

state.ak.us/insurance/whatsnewthismonth.htm.

The Alaska report tells you if your insurance company uses credit scoring to determine how much you pay for insurance. You may be affected and not know it.

Three bills on credit scoring have been introduced this year. House Bill 5 (Rep. Crawford) and Senate Bill 13 (Sen. Cowdery and Elton) ban the use of credit scoring. House Bill 47 (Rep. Chenault) bans the use of credit scoring for auto, house and boat insurance.

Testimony on HB 5 and HB 47 will be taken during the House State Affairs meeting Saturday starting at 9:30 am. Please make time to attend at your LIO and testify.

Dee Hubbard , Sterling



CONTACT US

  • Switchboard: 907-283-7551
  • Circulation and Delivery: 907-283-3584
  • Newsroom Fax: 907-283-3299
  • Business Fax: 907-283-3299
  • Accounts Receivable: 907-335-1257
  • View the Staff Directory
  • or Send feedback

ADVERTISING

SUBSCRIBER SERVICES

SOCIAL NETWORKING

MORRIS ALASKA NEWS