MT Commissioner of Securities and Insurance

1. Most insurance companies that sell homeowners and auto insurance use your credit history to determine if you are eligible for insurance coverage and the amount of premium you will pay.
   

2. Just because you think you have good credit, doesn't mean the insurance company agrees. Insurance companies may use credit differently from banks. Insurance companies typically create a "credit score" based on information obtained from your credit report. These credit scores may be based on factors that normally wouldn't adversely affect your credit, such as the number of times your credit has been checked or the type of credit cards you use.
   

3. You have the right to know up front how insurance companies use credit. If you aren't notified that your credit history is being used to determine your eligibility or the amount of premium you pay, call your company and ask if credit is being used. If it is being used, call the Insurance Department at 1-800-332-6148 and let us know that the company is not complying with the notification laws. 
   

4. Insurance companies are required by law to notify consumers in writing when an adverse action has been taken against the consumer that is wholly or partially based upon the consumer's credit. For example, if your auto insurer upon renewal determines that you have an unfavorable credit score and decides to raise your rates by 15 percent, the notification of the rate increase must indicate that the reason for the increase was based partially or totally on your credit.
   

5. If you have been adversely treated by an insurance company (by paying higher rates, being non-renewed, denied coverage, or placed into a sub-standard company) there are two things you need to do to get more specific information. First, request a free copy of your credit report. Second, ask in writing for the specific reasons for the action. By doing this you can see the kinds of factors that may be causing you to pay more for your insurance, and note any mistakes on the credit report.
   

6. If there are mistakes on your credit report, ask the insurance company to re-calculate your "credit score" based on accurate information. Having the credit score re-calculated might result in a significant change in your rate.
   

7. Shop around. Some insurance companies use credit to a greater degree than others, and credit scores can vary greatly from one company to the next. You might want to choose a company that bases its rates more heavily upon such factors as driving record and claims history. Specifically, you should find out how a particular company uses your credit and how often the company checks your credit report.
   

8. Call the insurance company to complain if you aren't satisfied with the company's practices. Agents aren't always given the information about your credit history and are often sympathetic with the consumer, but unable to change the company's policies. Agents can give you contact information for the companies they represent, but are not responsible for the insurance company's rating decisions.

Please contact the State Auditor’s Office if you have additional questions: