The insurance industry on October 2 appealed a Michigan Court of Appeals decision that reverses a 2005 Barry County Circuit Court decision allowing the use credit-based insurance scoring as a rating factor.

During the appeal process, insurance companies in Michigan will continue to provide lower rates based on credit-based insurance scores.

Credit-based insurance scoring discounts help allocate the cost of coverage based on a policyholder’s claim potential.  A 2007 study by the Federal Trade Commission found that credit-based insurance scores are effective predictors of risk under auto policies.  Credit-based insurance scoring discounts allow many consumers to pay less for insurance than they otherwise would, and enables insurance companies to offer coverage to more consumers than they had in the past.

For more information, visit our consumer section.