Unaware of Controversial Credit Scoring Practice when Purchasing Home Insurance
(Toronto, Ontario) December 7, 2010 – A survey commissioned by The Insurance Brokers Association of Ontario (IBAO) shows that 3 out of 4 Ontario consumers are not aware that their credit scores were being used to determine how much they pay for their home insurance. In 2005, the Ontario government banned the practice of using credit scoring in auto insurance policies. 76% of those polled in IBAO’s recent study support extending the credit score ban to home insurance.
Currently, many insurance companies use a person’s credit score to measure their insured risk. This has led to an increase in insurance premiums or an outright denial of insurance to many Ontario citizens.
Insurance brokers were at Queen’s Park on November 2nd, 2010 speaking with Provincial Parliamentarians about the growing concern. Following their visit, Liberal Member of Provincial Parliament (MPP) Mike Colle introduced his private member’s Bill 130: The Homeowners Insurance Credit Scoring Ban Act, 2010.
“Our priority is to protect the interests of our customers,” stated IBAO’s President Bryan Yetman. “These results clearly indicate that the average Ontario consumer is unaware that their credit score is currently being used to price their home insurance. They also indicate that insurers that use credit scoring are doing a lousy job informing their policyholders that they are using this very private and sensitive information against them.”
The use of credit scoring impacts consumers who can least afford it. Most affected are seniors, newcomers to Canada, the unemployed, single income families and small business owners utilizing lines of credit. “We can see no reason for the Ontario government to wait any longer to end this practice. It is unfair to consumers and consumers are rightfully opposed to it,” concluded Yetman.
MRP Market Research Professionals Inc. conducted the poll during the first week of November 2010, surveying 802 Ontarians. Results are considered accurate +/-3.5% 19 times out of 20.
About Insurance Brokers Association of Ontario
The Insurance Brokers Association of Ontario (IBAO) is a �not for profit’ association that represents and serves the interests of over 11,500 independent Property & Casualty Insurance Brokers in the Province of Ontario. For information about IBAO, visit www.ibao.org or www.ibao.org/blog. to receive timely news and information updates. You can also follow IBAO on Twitter or join the IBAO Facebook Fan Page. .