Re: Insurance Rant
I can partially agree with you on some of your premises and some I can't quite figure out what you mean.
Where you said "Now, your finances are in the toilet. Your bills are falling behind and those ugly negative marks start to show up on your credit report. Another situation, the company you worked for went belly up, and you're out of the job. Your bills are behind while you're trying to find work. Credit score doesn't care what the circumstances were." My thinking here is that a "responsible" person would have, depending on which situation, relied on their one year of salary they had saved in the bank, along with unemployment from the government and of course your disbility insurance you would have already had in force and hence the black marks would never have happened or would have been much less. I agree that yes there is no way the credit scoring companies can take into account each of the qualitative things that put you in that position but a person can certainly take steps ahead of time to mitigate the damage. My issue with the fact the scoring doesn't take into account income or worth. Looking at a credit report, you can have a $500,000 30 year mortgage in force for 5 years with essentially very little paid down on principal. The credit score looks at that outstanding balance as a 5 year old note with say 99% left on it. Of course there is 99% left on it, it has only been 5 years. Now they don't care if you make 500k a year and have 5m in assets so you are still penalized though may have never made a late payment and could write a check to pay off the balance if needed. That is my basic problem with credit scores.
Where you said "They're not obligated to cover you until the policy expiration date if they canceled the policy before that date. Therefore, they're not loosing any money so why does one have to paid a higher rate?"
Not sure what you mean here, if you have an occurence based policy and you are canceled say a couple months early....what do you mean by therefore, they're not losing any money? You can still make a claim that happened during the inforce policy period after you have been cancelled. Liability claims can take years to settle. This is called an insurance tail. Really just trying to understand this one.
Where you said "How could anyone makes judgement about anyone without knowing anything about that person?" They aren't personal judgemements just actuarial opinions used to make underwriting decisions. A lot of this just boils down to life isn't fair.
Your comment " How dare you to assumed that you can maintain your properties better then someone just because you have better credit score? How do you know if that person didn't have one of those unfortunate scenario above happened to them?"
I don't assume that but great credit scores require smart life choices. Each financial difficulty that stemmed from each unfortunate circumstance coud have been avoided with the correct pre planning. Why does one person plan for the unforseen and another didn't take the time to do so?
It is interesting to hear some of the logic behind the situations you discussed. I will generally come from the personal responsibility side of the argument which is usually not welcomed these days but has been very effective with me and most folks I know. I learned so many years ago to drop the victim mentality that I hear all the time and that making good choices always pays off in the end.
I realize this was just a rant thread but is one of the reasons this is such a great site during the off season.
I can partially agree with you on some of your premises and some I can't quite figure out what you mean.
Where you said "Now, your finances are in the toilet. Your bills are falling behind and those ugly negative marks start to show up on your credit report. Another situation, the company you worked for went belly up, and you're out of the job. Your bills are behind while you're trying to find work. Credit score doesn't care what the circumstances were." My thinking here is that a "responsible" person would have, depending on which situation, relied on their one year of salary they had saved in the bank, along with unemployment from the government and of course your disbility insurance you would have already had in force and hence the black marks would never have happened or would have been much less. I agree that yes there is no way the credit scoring companies can take into account each of the qualitative things that put you in that position but a person can certainly take steps ahead of time to mitigate the damage. My issue with the fact the scoring doesn't take into account income or worth. Looking at a credit report, you can have a $500,000 30 year mortgage in force for 5 years with essentially very little paid down on principal. The credit score looks at that outstanding balance as a 5 year old note with say 99% left on it. Of course there is 99% left on it, it has only been 5 years. Now they don't care if you make 500k a year and have 5m in assets so you are still penalized though may have never made a late payment and could write a check to pay off the balance if needed. That is my basic problem with credit scores.
Where you said "They're not obligated to cover you until the policy expiration date if they canceled the policy before that date. Therefore, they're not loosing any money so why does one have to paid a higher rate?"
Not sure what you mean here, if you have an occurence based policy and you are canceled say a couple months early....what do you mean by therefore, they're not losing any money? You can still make a claim that happened during the inforce policy period after you have been cancelled. Liability claims can take years to settle. This is called an insurance tail. Really just trying to understand this one.
Where you said "How could anyone makes judgement about anyone without knowing anything about that person?" They aren't personal judgemements just actuarial opinions used to make underwriting decisions. A lot of this just boils down to life isn't fair.
Your comment " How dare you to assumed that you can maintain your properties better then someone just because you have better credit score? How do you know if that person didn't have one of those unfortunate scenario above happened to them?"
I don't assume that but great credit scores require smart life choices. Each financial difficulty that stemmed from each unfortunate circumstance coud have been avoided with the correct pre planning. Why does one person plan for the unforseen and another didn't take the time to do so?
It is interesting to hear some of the logic behind the situations you discussed. I will generally come from the personal responsibility side of the argument which is usually not welcomed these days but has been very effective with me and most folks I know. I learned so many years ago to drop the victim mentality that I hear all the time and that making good choices always pays off in the end.
I realize this was just a rant thread but is one of the reasons this is such a great site during the off season.
That would be like winning a small lottery. I can buy another house twice as nice with the reimbursement money and I still own the lot the old house sits on.
