To the editor:

Before you open another credit card think about this:

I received a form letter saying that my auto/home insurance rates went up because my insurance score, which takes into account my credit rating, was not the highest that it could be. I pay my credit cards on time, in full, so per instructions I ran two credit reports from the specified Web site. Both showed perfect records, although I was surprised that cards with zero balances that hadn’t been used in years, marked as inactive, showed up.

After filing an automated report of objection with the company that compiled the insurance score, I contacted my local insurance company. An agent there informed me that because we had recently changed from my husband (who has no credit cards) being designated “head of household” to me (who has credit cards) being designated head of household, our insurance score had changed. My husband’s credit score was the highest it can be, I was told. Mine was not because I had several credit cards, she said. As a result our insurance went up over $200 for a year! How can this be legal?

This practice raises the question of why the cost of auto and home insurance can be based on credit ratings? Aren’t they based on the value of the cars and homes (with other environmental factors considered)? And why are we always told by financial advisers that we should open credit cards and pay them in full to achieve a good credit rating? Before you do that, I recommend you think twice.

Sara Henderson White,
Oskaloosa