Personal Credit Information - Can Insurance Companies Use It To Set Premiums?

According to a report of findings released by the Office of the Privacy Commissioner of Canada  (the "Federal Commissioner"), insurance companies can obtain personal credit information from credit reporting agencies and use it to assess risk and calculate insurance premiums.  However, they must obtain meaningful consent and be open about their personal information practices.

The complainants' home insurance renewal premium increased considerably compared to the previous year's premium.  When they looked into why, they discovered that the insurance company had asked for, and received, their personal credit information from a credit reporting agency.  In a complaint to the Federal Commissioner, the complainants alleged that the practice of using a customer's credit information, obtained from a third party (like the credit reporting agency), was inappropriate, and that the insurer did not have their knowledge or consent to do so.