I personally find this to be a disturbing trend. According to one insurance company spokesman quoted in the article: "Credit history provides a consistent, reliable tool to evaluate the risk of insuring someone without unfairly discriminating against any specific group of customers." In other words, the insurance companies maintain that those with poor or no credit have a higher chance of getting into accidents than those with good credit.
Even if it were statistically true that drivers with poor credit are more likely to get into accidents (and there have been no independent studies to confirm this), this to me smacks of pure corporate greed. In a time where bankruptcies and debt have reached record levels, it seems that insurance companies are using credit ratings to artificially increase many drivers premiums.
The article relates the story of 80 year-old June Dailey, whose premiums were raised by 47 percent because of a short credit history (June has an almost flawless driving record, but carries no credit cards and pays everything in cash).
The major implication that this scenario poses is that our credit card culture offers no way to opt out of the debt cycle anymore. I meet people all the time who say they will never use a credit card, or refuse to do so anymore due to past experience. But unfortunately these people will be negatively judged when it comes time to get a loan, job, credit card, car insurance, or any other transaction that uses one's credit rating as a determinant.
The discussion from several weeks ago pointed out that there are many advantages to credit card use, if used wisely. But why must one charge one's monthly groceries and gas to a credit card simply to cultivate an acceptable credit rating when cash or check will work just as well? (And remember, not having anything on your credit rating is just as bad as having poor credit).
And why is one's credit rating (which is simply a statistical measure of how ardent and responsible a consumer one is) used as a determinant in things such as auto insurance, employment and other situations unrelated to credit and debt? The hidden implications of this trend is that people who have experienced financial difficulties (primarily the young, the poor or minorities) are being disadvantaged financially, compared to more affluent folks who have more money to spend.
The conclusion is that for one to reap the most benefit in our consumer culture, participation in the credit card culture is almost mandatory. And if one slips up due to financial difficulty or irresponsibility, the consequences will haunt one in many more ways than just the ability to get credit. Since credit reports are inexpensive and easy to get, and the consequences of bad credit are well-established, corporations now have another way of getting more money out of you.