Auto insurance rates collide with credit

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As I took my life in my hands the other day and ventured out onto notorious Highway 19, my mind veered a hard right onto the concept of “auto insurance.”

Highway 19 is the multilane hell-scape near my home that leaps, swerves, screeches to inexplicable halts, randomly merges with malice and generally careens full-throttle in a Mad Max attempt to connect the sprawling fiefdoms of Pinellas County, Fla.

I don’t know what I was thinking, but it probably involved fast food.

“Do I care about the credit score of the guy about to ram me? Hardly.”

Mind you, this is the new, improved U.S. 19. Back when it was a mere terminally congested arterial, it spawned a healthy business in bumper stickers that pleaded, “Pray for me. I drive 19.”

Whilst white-knuckling all the way to Wendy’s, I came up with this quick roadside quiz: If you were in my Chuck Taylor All-Stars, what would concern you the most about the driver of the SUV in your rearview mirror that’s showing no signs of braking as it closes fast on your rear bumper?

  • A: I wonder if she’s just stumbled out of an all-night beer pong marathon?
  • B: I wonder if she’s just received a life-altering Tweet from her BFF that has temporarily ripped a hole in her space-time continuum.
  • C: I wonder if one of the soccer mom’s five little kickers just inhaled a Nerd, setting off a mad scramble aft, resulting in a temporary vacancy at the helm?
  • D: I wonder what her credit score is?

Now if you’re like me, you’re a lot more concerned about A, B and C than you are with her FICO score.

If your mind immediately went to D however, you’re probably an insurance agent.

Making the poor pay

There has been little uproar over reports that auto insurers have taken to analyzing your credit score before deciding what premium to charge you.

Here’s the logic: Folks with higher credit scores typically make more money — money they are willing to part with to settle fender benders without filing a claim that will cost their insurer. Folks with lower scores tend not to have that kind of dough to throw around, so they file claims.

If you’re an insurance company, it just makes good business sense. I have a few insurance giants in what’s left of my 401(k) and I want them to run a tight ship, too.

But the doubting Thomas in me (as in Dave Thomas, founder of Wendy’s) can’t help but wonder whether this is simply a convenient way for insurers to offer enticing rates to the rich while forcing the poor to pay full freight for auto coverage.

The interesting thing is, to my knowledge, the insurance companies have found no similar link between a high credit score and driving ability. There might even be an inverse relationship, as wealthier folks are more likely to have tricked-out, highly interactive rides and numerous peripherals like GPS, OnStar, MP3, satellite radio, traffic collision avoidance systems and aromatherapy-infused cup holders to distract them.

To test this theory, I just tweeted Mel Gibson, Nick Nolte and Lindsay Lohan. I’ll let you know what I find out.

But I’m betting we’ll see higher auto rates for wealthy multitaskers about the time “The Fast and the Furious” franchise speeds away with an Oscar for best picture.

Old school rules

Maybe I’m hopelessly old school on this, but I still prefer the traditional good-driver discounts — not for sterling credit, but for keeping your hands on the wheel, your eyes on the road and your rims between the ditches.

I don’t happen to live in one of them, but 19 states and the District of Columbia have laws that ban texting while driving. Seven other states have taken it a step further and banned the use of handheld cell phones while driving.

The National Highway Traffic Safety Administration says nearly 80 percent of vehicle accidents and 65 percent of near-misses in 2006 involved driver inattention.

Do I care about the credit score of the guy about to ram me? Hardly.

But my chances of living to eat that double-stacked cheeseburger with fries from the Super Value Menu would improve greatly if insurers could focus their incentives on ways to make him a more responsible motorist.