Connecticut state law requires us to let you know about how we use your credit information for your insurance, as well as your legal rights as a consumer.
A quick summary:
- Lemonade may use your credit history to help determine risk for car and homeowners insurance policies. However, we can’t base decisions solely on credit data.
- If recent life events like illness or job loss have affected your credit, you can request Lemonade to consider this.
Read on below for more information.
Disclosure in Accordance with Connecticut General Statutes Section CGS §38a-686(b)(6)(B)(ii)
If you are shopping for car or homeowners’ insurance, or if your current policy is up for renewal, Lemonade may review your credit history. As a general rule, we use your credit history in connection with our financial history measurement program or credit-scoring program to measure your risk of having an insurance loss.
For detailed information about how your financial history and credit information are used for underwriting and rating purposes please review the “Credit and Credit-Based Information” section of our terms of service on our website.
1. We are required to notify you of that and provide you with a summary of consumer protections regarding the use of your credit history in underwriting or pricing your insurance policy. These protections are that:
- we cannot deny, cancel or fail to renew coverage based solely on credit information;
- we are required to take into account the effect on your credit of extraordinary life circumstances (as described below);
- if we deny, cancel or increase your premium, or decrease your insurance coverage or amount of insurance based on your credit information, we are required to send you what’s called an ADVERSE ACTION NOTICE explaining the reasons for our action; and we can use credit information for:
- new insurance policies; and
- on renewal of an insurance policy. We may obtain and use your most updated credit information at renewal only at your request or if such use reduces your premium.
2. If your credit information has been adversely impacted by an extraordinary life circumstance that has occurred within the last 3 years, you may request in writing that we consider this information when using your credit information. These extraordinary life circumstances include:
- a catastrophic illness or injury;
- divorce;
- death of a spouse, child or parent;
- involuntary loss of employment for more than three consecutive months;
- identity theft;
- total or other loss that makes your home uninhabitable; and
- any other circumstance an insurer may choose to recognize.
If you believe any of these extraordinary circumstances have impacted your credit, please contact us and let us know of your extraordinary circumstance(s).
We may require you to provide reasonable, independently verifiable written documentation of your extraordinary life circumstance and explain how it has negatively affected your credit report or credit history. We will keep confidential any documentation you provide to us.
3. You should also know that we cannot use the following credit-related information as part of our financial history measurement program:
- the number of credit inquiries in an applicant’s or insured’s credit report or credit history;
- the applicant’s or insured’s use of a particular type of credit card, debit card or charge card;
- the applicant’s or insured’s total available line of credit;
- any disputed credit information while such dispute is under review by a credit reporting company, provided such information is identified in an applicant’s or insured’s credit report or credit history as being in dispute;
- collection accounts identified with a medical industry code in the applicant’s or insured’s credit report or credit history; and
- the applicant’s or insured’s lack of credit history, unless the insurer treats the applicant or insured as if such applicant or insured had neutral credit information, as defined by the insurer.‘
If you have any questions, please contact Lemonade at [email protected], by phone at (844) 733-8666, or you can write to us at 5 Crosby St. New York, NY 10013.