Expert Insight

• On their webside, Nationwide claims studies support their use of credit scoring to evaluate auto insurance risk. However, they do not cite specific studies.
  
  

Effects

• Auto insurance companies not only have the right to use credit scoring, but also can legally not inform consumers they received a higher rate due to their credit record.
  
  

Theories/Speculation

• Credit reports are harder to change than driving records and therefore are a more solid indicator of financial risk, according to Joseph Annotti, a spokesman for the Property Casualty Insurers Association of America.
  
  

Considerations

• Consumer groups note the insurance industry's use of credit scoring is unfair, especially in hard economic times. Some people with a poor credit report did not act financially irresponsibly, notes Chi Chi Wu of the National Consumer Law Center.
  
  

Benefits

• Those with good credit will likely experience savings on car insurance.