Will a Driving Record Affect Homeowners Insurance?

There is a massive complexity to the formulas that are used to determine homeowners insurance rates. Many people feel like the risk assessment for their situation is solely limited to things that are directly related to whatever type of insurance is being purchased. For example, people think that home-specific statistics are the only ones used to determine homeowners insurance rates.

Homeowners insurance providers do use other statistics and variables as well, including a person’s age, marital status, credit score, and of course, things like the location of a person’s home. At least one major insurance company takes driving records into consideration when giving prices for home insurance premiums to inquirers. Allstate Insurance uses this information in the states of Kansas and Oklahoma, among others. There is a chance that other auto insurance companies will follow suit, or have already.

Home Insurance Considerations

Home insurance underwriters take into consideration whether people conduct business from their homes, the types of lifestyles they live, and whether repairing an existing building costs more than the value of the building itself. All of this information, in addition to the materials used to build the home and external factors like natural disasters, are used in determining home insurance premiums.

Other Risk Assessments And Statistic Use

Statistics are used to target customers, generate leads, cross sell products, and adjust risk assessments. Most insurance companies do not use driving records to adjust premiums; they do use the information to market other types of products relating to insurance though. More companies may expand to using driving records as a variable to help determine homeowners insurance rates as the years go by. If there is a correlation involved, insurance providers are likely to tap into it.

More Details About Home Life Factors

Premiums are based on numerous factors that are directly related to the property, area, and circumstances inside the home. This includes things like whether there are children in the house, the age of the home, pets in the house, the age of the people residing in the home, crime rates in the area, and of course any discounts that are applied to the policy. In addition, fire and police resources in the area, as well as the type of construction, also have an impact. In some states, a person’s credit score can be used as a variable to determine risk, also having an impact on a person’s rates. If driving records can also help predict a person’s risk, they will likely be used by more companies in the future.

Consumers Strike Back

Many people are not aware that insurance companies utilize what could be considered private information to underwrite policies. Some groups have protested the use of this information, saying that it invades people’s personal privacy. Protests have been used in regards to credit scores, and it is likely that protests about utilizing driving records will also come. Insurance companies have a goal of limiting their risks, but sometimes consumers respond by refusing to support companies that become more intrusive in terms of private information. It is up to you whether to support companies that utilize driving records or not.

Regardless, you can find the best prices for homeowners insurance here on the site. Compare policies from multiple companies to find the top rates for home insurance in your area.