In December, two women bought nearly identical houses just a few blocks apart in Northern Minnesota. The homes shared identical layouts, were constructed at roughly the same time, and were purchased for the same price. But when it came to home insurance rates, the annual insurance premium for one home was $1,272, and the other was $2,898. What gives?
The discrepancy boils down to three digits that dictate a huge portion of our economic lives: credit scores.
"This insurance pricing gap means that people with worse insurance scores — which are not poor scores, they're more like a fair if you look at the credit rating category — are paying up to double on average as people with excellent credit," said reporter Claire Brown, who covers climate change for The New York Times.
She recently wrote about how credit history can impact homeowner’s insurance rates — even more than climate-related risks. Brown spoke with “Marketplace” host Amy Scott about her reporting.
Click the media player above to listen to their full conversation.
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