General insurance What are insurance scores and it importance to insurers

[Phabbyfundz]

Insurance scores are confidential ranking based on credit history information. They are a measure of how a person manages his or her financial affair. People who manage their finances well tends to also manage other aspect of their lives responsibly, such as a driving car combined with factors such as a geographical area, previous crashes, age and gender.
Insurance scores enable auto insurers to price more accurately so that people less likely to file a claim pay less for their insurance than people who are more likely to file a claim. For homeowners Insurance, insurers uses other factors combined with credits such as the home construction, location and proximity to water supply for fighting fires.
Insurance scores predict the average claim behavior of a group of people with essentially the same credit history. A good score is technically above 760 and bad score and a bad score is below 600.

 

[Chibson]

Insurance scores is very important for you to get covered by an insurance company because they will consider your financial history which will suggest if you will be able to keep to the agreement or not. Insurance companies are businesses and they also need to make their own profit, so they do not need individuals with bad financial records.

 

[btaliat]

In financial institutions like insurance, credit score is what they do judge their customers with. A person that is good at managing their financial lives are better at other aspects again. They will be good at keeping promises by paying their premium as and when due and be trusted with other financial related issues.

 

[Mandy96]

This insurance score is very important and beneficial in order to get the ability to get some extra favors from the company but it only happens in USA I guess because I don’t remember Nigeria using score ranking for determining credit history. This could be used to get loan or things like it without the need of collateral

 

[Wisdom01]

Wow I never knew something like this exist , but can the score also be used by insurance companies to determine the amount of premium that would be payable by the insurer ,since it could be used to rate the property or asset that is going to be insured by the company

 

[btaliat]

Wow I never knew something like this exist , but can the score also be used by insurance companies to determine the amount of premium that would be payable by the insurer ,since it could be used to rate the property or asset that is going to be insured by the company

I don't think so. The fact is that most time the score record is just to be very sure of the insured person. This is to certify whether the person is good at managing any financial records. It is not only insurance company that always concern about the score record but almost financial institutions.