I recently received a letter from American Family Insurance indicating that I am entitled to a free credit report because they had taken the following actions:
So I went to transunion.com and found my credit report and observed that there was a negative mark on it corresponding to a "public record" -- a court case. So I went to mycase.in.gov and searched for my name.
What had happened is a business had gone belly up and a collection agency had gone on to sue the business. The court threw it out because they couldn't locate the defendants since the business was defunct. So the collection agency had refiled the case, this time personally naming the three owners. The owners appear to be brothers, sharing the same last name which happens to be my last name. One of them happens to have my first name as well. He also has the same street number as I do, BUT ON A DIFFERENT STREET.
Let me ask you. If you were given two addresses:
1234 N Fred St
1234 E Wilma St
Would you say that they are referring to the same place? TransUnion would.
So I asked them to investigate the record. They did not allow me to provide any information whatsoever about my dispute, they merely asked me which record I wanted to dispute, and promised to perform their own investigation.
Today (5 days later, as promised), I have received an email from them saying that they have resolved the dispute and deleted the record. I did not get so much as an apology, though I have already suffered an increase in my insurance rates due to this error on their part.
The part that really bothers me is that I did not have to tell them why this thing was in error. They were able to, without any additional information from me, determine that I was not in fact the defendant named in this case. So it goes to follow that in 2007 when they added this little lie to my record, they could have then also, without any additional information from me, determined that I was not in fact the defendant named in this case. In fact, they never at any time had any reason to believe that I was the defendant in that case! Every time they said that they believed so, they had been lying!
This whole scenario reminds me of when I was about to graduate from college. I received a letter saying I would not be allowed to graduate because I had unpaid parking tickets (I don't have a car). So I contacted parking ops, who said I had rented a car. I told them I hadn't. They said they had a rental record for an individual with my name. I told them my name was quite common. They told me "We wouldn't have put the record in if the addresses hadn't also matched." So I asked them what the address on the record was, and they said an address in Arizona. I then asked them to tell me my address, and they said an address in Indiana. They had been lying.
Anyways, lying is lying, and it's what TransUnion does.
The underlying story here is that American Family Insurance wants to fuck me over if I get bad credit. They say that they have performed many non-published studies indicating that the odds of paying out are strongly correlated to the credit report.
I contacted my agent and he said he thinks using the credit report is a nuissance to him, but that everyone is doing it.
The trouble here is that I count on my insurance company. For a relatively small sum of money they indemnify me against a great number of possible future events which could take away my only financial asset. So I could imagine many circumstances which could induce TransUnion to say enough negative things about me that my insurance company may raise my rates in the middle of a personal financial crisis, or may even cancel my coverage all together. I could be laid off, or I could simply have a dispute with another company (I am always arguing with my cellphone company).
If they have to use your credit score to determine your rates, they should do so at one time, and not repeat the query every year. If the insurance company is not in the business of accepting a long-term risk based solely on the factors present at the beginning of the relationship then the product they are vending IS NOT INSURANCE. Insurance subject to arbitrary rescission insures against nothing!
If you discover a homeowner's insurance provider which does not use credit checks, please inform me of them!