Learning Center

Credit Based Insurance Scoring

Credit information derived from customers' credit reports is only one of many factors that American Family Insurance Company considers when pricing a risk. Credit information has been proven to effectively predict the likelihood of future insurance claims. We're finding that our use of credit information allows us to offer lower premiums to many customers who otherwise would pay more for their insurance.

During the past several years, insurance companies have increasingly used credit information as a factor to price and evaluate insurance policies. For an overview of how American Family Insurance uses credit information, please refer to the frequently asked questions below.

Frequently Asked Questions

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What is a consumer report?

According to the Fair Credit Reporting Act, the term "consumer report" means any communication of any information, by a consumer reporting agency, bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used, or expected to be used, or collected, in whole or in part, for the purpose of serving as a factor in establishing the consumer's eligibility for credit or insurance to be used primarily for personal, family, or household purposes, or employment purposes, or any of the permissible purposes authorized under Section 604 of the Fair Credit Reporting Act.

American Family Insurance gathers information obtained through routine business transactions and occasionally from outside sources by ordering consumer reports from consumer reporting agencies. The information provided might include your driving record (motor vehicle reports or MVR), claims history (claims loss underwriting exchange reports otherwise known as a CLUE report), and credit report data.

 

Additional Information

American Family Insurance offers a brochure for you to download1 and read at your convenience.

Credit-Based Insurance Scoring Brochure (288KB)

 

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