Credit-based scoring has become much more common place with insurance companies in determining your premium.  Obviously, banks have utilized payment histories in qualifying an individual for a loan for decades; however, recently other businesses have picked up on this practice.   The premise is that credit history is an indicator of future insurance claims on the part of an individual.  Credit-based scoring develops a numerical total based upon financial information such as payment history, defaults, delinquent payments, outstanding debt, etc. The higher your score the greater likelihood that your policy will receive a premium discount.

  
Though credit-based scoring is still controversial there remains a strong correlation between the score and the potential claims reporting of a policyholder.  Credit- based scoring is not utilized in all instances but its use continues to grow.  You have the right to attain a copy of the credit score to insure the information on your credit history is accurate.