CHICAGO, IL, - The American Property Casualty Insurance Association (APCIA) submitted the following letter to the editor to the New York Times in response to the article " The Hidden Factor Behind Your Home Insurance Cost: Your Credit History ." This letter is attributed to Paul Tetrault, APCIA senior director & counsel, personal lines. This letter points out how this article overlooks key facts about how credit information is used in insurance underwriting and pricing and benefits consumers with fair and accurate rates based on risk.

Dear Editor:

"The Hidden Factor Behind Your Home Insurance Cost: Your Credit History " overlooks key facts about how credit information is used in insurance underwriting and pricing.

The article suggests it is surprising that credit affects insurance costs, yet insurers' use of credit-based insurance scores has been well documented, researched, and validated for decades as a fair and accurate way to assess and allocate risk. Unfortunately, the article ignores the substantial body of evidence showing the consumer benefits of the practice.

It also quotes a researcher claiming that using credit leads to subsidization. In reality, the opposite is true. As I explained to the authors, credit-based insurance scoring ensures that consumers pay prices aligned with their risk. It is restricting the use of credit-such as Washington State's temporary 2021 ban-that results in subsidization, forcing lower-risk consumers to pay more so higher-risk consumers can pay less.

The article also conflates income and credit in ways contradicted by established research and overlooks existing laws that prevent disaster-affected policyholders from being harmed by credit changes.

Ultimately, the fair use of credit information allows insurers to price more accurately, encourage competition, and keep costs lower for most policyholders-an increasingly important tool as disaster-related risks grow.

Sincerely,

Paul Tetrault

Beverly, MA

978-578-3569