Insurance broker credit check ....... why ?

[Nigel Worc's]

Hello all.

A chap on a beemer forum I use has asked the following, anyone know why this should be, are they telling the truth etc ?

I have just been informed by my broker (Footman James / Aon) that in order for them to give me a quote, I must agree to the insurance company doing a credit check on me.
Just for a quote! I always pay for my insurance in one lump prior to the policy being issued or renewed, so why do they need a credit check. The broker says that if I do not agree to this, then they will not be able to give me the best quote, or in some cases none at all.
Have we any insurance experts in the comunity who can give an explanation for this.
I have never had any problem with credit, as I usually deal in cash or use my credit card, and that is paid off by direct debit on a monthly basis, so a credit check does not worry me, but it is costing the insurance companies, so the premium will go up. Its also a matter of principal.


Thread here : http://www.bavarian-board.co.uk/forum_posts.asp?TI...

[Nigel Worc's]

TVR1 said:

As a previous poster mentioned, it is an ID verification check. It is recorded as such on your credit file for you to see but is not recorded as an enquiry in relation to your financial position. No other lender or anyone you apply for credit from can see the enquiry. A non event but it does get people worried in case of multiple searches causing damage. No probs at all.

Many thanks, I've put a link to this thread on the beemer forum for him, but I'll copy and paste your answer too, he's a lovely old chap.

[Nigel Worc's]

From Howard on the beemer forum, any comments from the insurance chaps ?

Nigel

Quote from the Aviva Website FAQ which you will not find until you have filled in the car insurance application form and got to the end. You can then find this little item hidden under a double depth link in their FAQ section. http://www.aviva.co.uk/credit-popup.html
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Credit Search Information
Will the credit search you make affect my ability to obtain credit in the future? Will a record of the search be left on my credit history? In line with standard industry practice, a record of this search will be left on your credit file at the Credit Reference Agency, which will be visible to you when you obtain a copy of your credit file. It will also be visible to other lenders when they carry our future credit checks on you, and may be used as part of their decision-making process when assessing your applications.
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See the last sentence. Does that affect your future credit rating or does it not!