I read some of the same studies after we 'spoke' last night, Ken. Aside from the commission just saying 'using those scores are accurate predictors'...in other words, rubber-stamping what the industries who use FICO want....I didn't see proof.

Partly because I don't trust them. There comes a point where, if you're honest with yourself, you'll see that there's two sides here. One side.....the entire credit industry...and at least most of the insurance industry......all worship at the altar of FICO. And want to use the score. With the credit industry, it's a matter of laziness. Can't really blame them. Credit has gotten way too big for the credit issuers to actually...you know....look into an individuals financial situation on their own like they used to. With the insurance industry, it's a quick and easy way to use a score as justification to raise rates on persons with 'risky' FICO scores.

And please. Don't ask me to believe the patronizing bulls--t that by being more accurate and making riskier (from FICO) clients pay more...it allows the insurance companies to grant better rates on those who are less risky (from FICO). Like they really give a s--t about that. Aside from insurance companies like USAA which are not-for-profit....insurance companies are...in the end....'for profit' businesses. It didn't enter into their brain pans to use FICO so they can give one group better rates. That's a 'masking' argument....because they knew going in that when folks found out they were using FICO....there would be complaints and lawsuits.

OK. On the other side. A number of consumers who complain and or sue over the insurance industry using FICO.......

Now. WHOSE side do you think the FTC is going to come down on in the argument?

Lots of $$$$$ in that-thar FICO score. And lots of powerful lobbying groups who rely on it......or who wish to garner profit from it.

 

Of course it doesn't work for you.

I have not been in every Target, Walmart or Best Buy in every state but, I have NEVER seen any of these stores off discounts for cash. And Amazon? No stores and no discounts there either. How is it that you found a way to introduce them into the cash discount discussion?

What would be your indicator of financial health? FICO merely reflects your propensity to utilize, manage and debt repayment record. As in do you keep your promise to pay. It is not meant to reflect your financial health. The lending institution(s) determine that with income and asset verification vs. your actual debt load. Debt to Income ratio.

So Steve does not believe the statistics, and the reports are not substantive enough. Surely it cannot be true that those with lower FICO scores...again, a HISTORY of repayment. Not necessarily the ability to repay....are a greater insurance risk that those with a cleaner history. They musta just made it all up. Because they are all in cahoots with each other. Sonsabitches.

 

I made the point why I don't trust the commission 'study', Keith. Not my fault that you continue to take Government studies at face value without looking at the underlying biases.

That's on you. Not me. But continue to toe the 'big business' line.

 

Then answer my questions. What's your fix Steve?

Just because you do not believe reports provided by the industry, or the feds, doesn't make you a leading authority on it. Show us proof of your knowledge or that they are wrong.

Show us that FICOs are no reflection on one's history of payment. Counter, with facts, not "I don't trust them". Show us that lower FICO scores do not indicate a higher insurance risk.Or, debt risk, for that matter.

"I don't trust them, don't cut it"

Don't you enforce laws every day that were put in-place because of government supplied statistics?

 

I didn't say it didn't reflect a 'debt' risk, Keith........By and large, I don't have a problem with FICO being used for that. I'm saying it's disingenuous for insurance companies to be using them. In the end, the only thing that really matters for insurance companies are if you are in the habit of poor driving habits (i.e. getting speeding tickets, DWIs, etc.).....or the habit of making your car go 'boom'. Or the universal 'age' factor which they ALL use. The proof of the pudding is in the eating......and if your pudding is 'safe'....you should NOT be paying a premium based on a f--king FICO score. End of story. Deal with it.

Again. For the slow kids. All insurance companies are granting you is real time coverage. You are paying as you go. They are not giving you anything in 'advance'. They're not even giving you 'stuff'. Just a service. An important one.....but still just a service. Now......if FICO was as important as apparently you and Ken seem to think, then ALL the insurance companies would be doing it. If 'risk' was really their motive in determining that FICO really mattered....then why the rush for 'accident forgiveness' we see all the time? If someone plows into the rear end of another vehicle, isn't that an utter sign of 'risk' for the insurance company. Why would that person's insurance NOT go up.....but some poor bastard with a clean driving record....but low FICO score...have HIS go up? Hmmmmm?

Regarding cell carriers....I can kinda-sorta see their reasoning. Most folks are on contracts. Also, they ARE giving you 'stuff'......(i.e. paying $99 for a smart phone versus $399 (or more) if you purchase the phone outright. A FICO would be appropriate there.......

 

What you have missed, from what Ken and I have said, is that FICO is only a part of the actuary process. Not the single biggest driver of your insurance rates. End of story.

Just for chits and grins, don't think for a minute that USAA is a not-for profit BIG business. Purely a legal maneuver that gets them a bit of an advantage over other companies...and they don't even have the best rates in town.

They are making $$$$ and holding a whole lot of back after sending refunds to the members. I think Woodman Of The World is set up much the same way. To me, it just all legal pizazz and sizzle.

"One of the characteristics that allows USAA to operate differently than almost every other Fortune 500 company is that it is not a corporation. The parent company, United Services Automobile Association is an inter-insurance exchange, the establishment of which is provided for under the Texas Insurance Code [6]. This insurance exchange is made up of current and former military officers and NCOs who have taken out P&C policies with USAA; thus they simultaneously are insured by each other and, as a group, own USAA's assets. …
Since there are no shareholders, profits are retained for financial strength or returned to the members. Returns are accomplished through an account each member has called the Subscriber Savings Account, or SSA. Each year a portion of USAA's profit is retained as "unassigned", the rest is allocated to each member's SSA using a formula based on the amount of premium the member paid that year as well as the member's SSA balance.Technically, only the actual military personnel who are members of USAA are part of the Insurance Exchange. "Associate members" (dependents, spouses, etc.) of military personnel, are insured through a more traditional Delaware Corporation, but in practice there's no difference to the member."

https://en.wikipedia.org/wiki/USAA

 

Marketing. Pure and simple, and you apparently bought into it.

 

I doubt you'd quote, or believe studies which contradict YOUR point of view also. Works both ways.

You misinterpreted there being no zero FICO score. Wrong.

FICO doesn't indicate risk. Except for carrying debt. Wrong.

BS on who commits fraud. Bernie Madoff comes to mind. There are many, many others. BS argument.

I wasn't using the fact of lawsuits alone an indicator of fraud. I said the insurance companies....when they were planning on going the route of using FICO scores....were going to face more of them. And planned accordingly.

It's one thing for FTC to come down against Paypal. It's quite another for them to come down against the powerful insurance lobby.

Next.

 

No. What it means is there's a constant barrage of advertisements on TV and radio tooting that horn.

Look, Keith......I don't expect you (a business tycoon) and Ken (an internet mogul) to understand the plight of the hoi polloi vis-a-vis going against the government and various industries. I fully expect you to swallow the BS the big companies pedal.

 

As smart, and informed, as you are Steve...sometimes you just don't know chit. Then you try to cover it up with snide, cutesy remarks.

All I, and Ken, was trying to do is 'splain how the system works but, all you want to do is stomp around and cry that the BIG CORPS are mugging the little man over a singular component of a very complex system of actuating. When you get right down to it, I really don't give a flying %@#$ if you want to get it, or not. Sometimes you just won't listen boy.

Your way of the highway, again,...so I will just ease on down the road on this one.

 

You mean like these snide and cutesy remarks???

Priceless.