Poor credit history can affect homeowners insurance rates

This is from a May 5, 2017 New York Times article written by Ann Carrns:

The impact of one’s credit history on homeowners insurance rates appears to be intensifying. If you have poor credit, your premium is more than double, on average, the rate for a homeowner with excellent credit.

Homeowners with fair, or median, credit pay on average of 36 percent more than those with excellent credit. That is up from 32 percent in 2015 and 29 percent in 2014. The increase for having poor credit, 114 percent, is up from 100 percent in 2015 and 91 percent in 2014.

The spread between premiums for poor and excellent credit varies by state, since state regulators set rules for insurance and some allow credit history to be weighted more heavily than others do. Other factors in setting homeowner rates include the age of the home, the condition of its roof and the quality and proximity of firefighting services.

The five states with the biggest average premium increases when credit goes from excellent to poor were South Dakota, Arizona, Oklahoma, Nevada and Oregon. The smallest increases were in North Carolina, Florida, New York and Wyoming.

Three states – California, Maryland and Massachusetts – bar the use of insurance credit scores in setting premiums.

Once a homeowner takes steps that improve their credit, they can ask their insurer to review their premium for a possible reduction – sometimes called rerating.

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