Past experience provides insurance companies with evidence that a favourable credit score correlates with lower insurance risk and fewer claims.
That’s why some insurance companies are now asking clients for consent to do a “soft” credit check to ensure the lowest possible premium is offered. You of course have the option to decline. If you consent, rest assured, insurance companies do not share this information with brokers or anyone else.
You of course have the option to decline. But rest assured that insurance companies never share this information with brokers or anyone else.
A credit score is calculated by credit reporting agencies based on your record of credit and payment history.
Soft Check vs Hard Check
A “soft” credit check is often done by various types of companies to gather background information and does not affect a person’s credit score or history.
If you check your own credit report, which is also considered a “soft” check, you and only you will see if anyone else has done a “soft” credit check on you. “Hard” credit checks are the ones the banks use to make decisions about loaning money or issuing credit cards, and too many of these can affect your credit rating.
Technically, just about anyone can do a “soft” credit check without your consent, but insurance companies and brokers will always ask first. Whether consent is granted or not, the results will not be used to deny coverage or increase premiums. The sole reason is to establish the most favourable premium for that client.
If you have concerns about a request for a “soft” credit check by an insurance company, talk to your Murrick Group insurance agent.