Credit-scoring significantly improves insurance pricing accuracy when combined with other rating variables in predicting risk. That's the conclusion of a study commissioned by the Texas Department of Insurance (TDI).In December, the department released its preliminary findings, which showed poor credit scores were associated with more claims activity, and blacks and Hispanics on average have lower credit scores than whites (see Feb. issue, page 8.)

The practice of using credit-based insurance scores has been under scrutiny for possible disparate impact on minorities and low-income people.

Register or login for access to this item and much more

All Digital Insurance content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access