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These days, many consumers may be a little bit worried about the ways in which their insurance costs have risen in the past few years, and this issue may have been particularly difficult for those who have low credit scores overall. However, the fact that a credit score can affect a person's insurance costs may not be a widely known fact. As such, it might be incumbent upon insurance agents to make their clients aware of this potential issue, and walk them through what they might be able to do to keep their monthly costs as low as possible in other ways.

These days, 85 percent of home insurance companies use credit score information to help set consumers' premium payments, according to a report from CNBC.com. The reason for this is very simple: A credit score is simply a rating of how likely it is that a person will pay all their bills on time and in full every month, and as such, insurers will likely see that kind of data as vital to determining just how risky an investment a certain borrower might be.

""There is an undeniable correlation between credit information and insurance risk,"" Anna Bryant, a spokeswoman for a major home insurance company that doesn't use scores to determine policyholders' premiums, told the new organization. ""It is a correlation in terms of the frequency a person could have a claim and the severity of their claim.""

Why is this a problem?
Consumer advocates note that this might unfairly punish people whose scores may be low for reasons beyond their control - prolonged joblessness, large emergency expenses, and so on - but at the same time, only three states (California, Massachusetts, and Maryland) actively outlaw this practice from insurers, the report said. Other companies that don't use scores themselves, meanwhile, may still rely on some credit-related data to determine consumers' costs.

Insurance agents whose clients might face higher annual costs because of diminished credit scores might want to take the time to walk those people through the ways in which they can save money on their policies, whether it's through finding additional discounts that might be available to them, or recommending methods for boosting their scores. Doing so may be able to go a long way toward boosting customer satisfaction, which, in turn, can ensure high retention rates and even attract new clients through potentially positive word of mouth.

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