Science
How Rising Home Insurance Costs Are Linked to Credit Scores
Two friends bought nearly identical homes last year, in the same northern Minnesota neighborhood, for the same price.
But Tara Novak pays more than twice as much for home insurance as Petra Rodriguez. The only difference? Ms. Novak has a lower credit score.
Across the country, people with weaker credit histories are paying far more for home insurance than owners with spotless records.
Where the home insurance rate gap between “fair” and “excellent” credit is higher
Home insurance premiums have risen rapidly in recent years, fueled by climate change, building costs and inflation. The price shock has rippled into the real estate market, dragging down home prices in areas vulnerable to disasters and leading insurers to abandon homeowners in risky places.
But these dynamics obscure another problem: The home insurance market has cleaved in two along a boundary defined more by a customer’s personal history than by the risk of a disaster hitting their home.
Americans with weaker credit histories, usually from missed payments or high amounts of debt, now pay significantly more for insurance, regardless of where they live, two new studies have found. While those with poor credit histories often can’t purchase homes at all, people with “fair” scores, which range from around 580 to 669, are paying twice as much in some places as people with “excellent” scores of about 800 or higher. And the gap is growing.
Insurers use a metric based on credit history known as an insurance score to set rates, and the figure tracks closely with a customer’s credit score.
The penalty for having a “fair” credit history versus an “excellent” one
States with the biggest pricing gaps
That can mean owners of identical homes, like Ms. Novak and Ms. Rodriguez, pay wildly different rates to insure them. For most people, it’s now just as expensive to have a credit score of “fair” as it is to live in an area likely to experience a disaster like a hurricane or wildfire. About 29 percent of consumers have credit scores that are categorized as “fair” or “poor.”
“There’s so many reasons people have bad credit,” Ms. Novak said. “It’s not like I’ve ever not paid a bill on time. I’m a stickler on my bills, I’m a stickler on my rent, never been late. This is not fair.”
“The choice to use credit scores in pricing means that those lower-credit home owners in risky areas are effectively subsidizing more affluent high-credit homeowners who also live in risky areas,” said Nick Graetz, assistant professor of sociology at the University for Minnesota, who wrote one of the recent papers. “So in a lot of ways, you can keep your insurance price down if you’re high income, high credit — even if you live on the coast of Florida.”
A handful of states have banned insurers from using credit data because of concerns about fairness and the potential for discrimination against low-income people and people of color, but the majority allow it.
For those with both weaker credit and high disaster risk, the combination can set them up for a downward spiral: disasters tend to be followed by decreases in credit scores as people use credit cards and bank loans to recover. That can lead to higher insurance rates, pushing monthly housing costs further out of reach.
“When a disaster hits, there’s a loss of income that occurs, and then that can impact someone’s credit score because they can’t pay their debt, they can’t pay their rent, they can’t pay their mortgage,” said Lance Triggs, executive vice president at Operation HOPE, a financial literacy nonprofit. “And now they’re faced with higher insurance premiums post-disaster.”
A working paper released today by the National Bureau of Economic Research found that homeowners with the lowest credit scores paid, on average, $550 more in 2024 for home insurance than those with the highest scores.
The findings broadly track with data from Quadrant Information Services analyzed by The New York Times, which found that, on average, lower credit scores meant higher premiums across every state that allowed the practice. Dr. Graetz used the same data set for his research, which he did in collaboration with the Consumer Federation of America and the Climate and Community Institute.
When a windstorm last year hit the home of Audrey Thayer, a city council member in Bemidji, Minn., it ripped the siding off her house and stripped shingles from her roof.
Ms. Thayer’s insurance did not cover all the damage. As she fought her insurer for more money, she opened new credit cards and bank loans to repair her home. Her credit score dropped as she tried to find a new insurance plan.
Ms. Thayer, a member of the White Earth Nation, said she was not aware that her credit score could affect her home insurance rates, even though she teaches about credit ratings at a nearby tribal college. “Most of the folks here do not have good credit,” said Ms. Thayer, whose community is one of the poorest in the state. “I did not know what a credit score was until I was 35 or so.”
In Texas, the advocacy group Texas Appleseed found that some insurers charge people with poor credit up to 12 times as much as people with excellent credit for certain policies, said Ann Baddour, the director of the nonprofit’s Fair Financial Services Project.
Higher costs have serious implications for low-income homeowners who live in the path of hurricanes, said Nadia Erosa, the operations manager at Come Dream Come Build, a nonprofit community housing development organization. After the Brownsville, Texas, region saw intense flooding last spring, some residents turned to companies offering high-interest loans to fund repairs, she said, raising the risk of the disaster-credit spiral.
“Delinquencies are going up because people cannot afford their payment,” she said.
The price of risk
Before they can get a mortgage, homebuyers are usually required by lenders to purchase home insurance.
“Households with insurance have fewer financial burdens, fewer unmet needs, they recover faster, they’re more likely to rebuild,” said Carolyn Kousky, an economist and founder of Insurance for Good, a nonprofit that focuses on finding new approaches to risk management. “Yet the people who need insurance the most are the least able to afford it.”
Insurance companies consider a variety of factors when setting the premium for a property. They might examine the age of the roof, or the area’s vulnerability to hurricanes or wildfires. They factor in how much it would cost to rebuild the house if it were damaged.
Insurers have argued that credit history is also worth considering because people with low scores tend to file more claims than those with excellent scores, an assertion that is backed up by the working paper published in the National Bureau of Economic Research today. This likely happens because people with weaker credit histories tend to have less income, and when their home is damaged, they file insurance claims for smaller fixes that a wealthier homeowner might pay for out of pocket.
Paul Tetrault, senior director at the American Property Casualty Insurance Association, a trade organization, said credit scores are a valid way to price premiums.
But others argue that using credit information to price insurance doesn’t make sense.
Because a homeowner pays for insurance upfront, “it’s not like you’re really extending a loan to the customer where you would be worried about the risk of repayment,” Ms. Kousky said. She points out that insurance companies can opt not to renew a homeowner’s policy if they believe it is too risky — a tactic they have been using with increasing frequency.
The NBER analysis found that homeowners who want to pay less for insurance should pay off debt to raise their credit score rather than replace roofs and make other improvements to avoid damage when disaster strikes.
Others believe that even if credit scores are accurate predictors of future claims, they shouldn’t be used to set premiums because that can perpetuate or worsen disparities. For example, people in their mid-20s who are Black, low-income, or grow up in impoverished regions have significantly lower credit scores than their peers, a July working paper from Opportunity Insights, a not-for-profit organization at Harvard University, found.
“When the government and the financial system mandate that we buy a product, there’s a special obligation to make sure the pricing is fair,” said Doug Heller, director of insurance at the Consumer Federation. “To me that is an absolutely solid reason, just like we don’t allow pricing based on race or income or ethnicity or religion.”
A natural experiment
A handful of states, including California and Massachusetts, have banned or limited the use of credit scores in setting home insurance premiums, despite opposition from the insurance industry.
In Nevada, where a temporary pandemic-related rule prevented insurers from using credit history to increase premiums for existing customers from 2020 to 2024, companies refunded approximately $27 million to nearly 200,000 policyholders, said Drew Pearson, a spokesman for the Nevada Division of Insurance.
Perhaps the clearest example of the effects of these bans comes from Washington State, which banned the use of credit information in setting home insurance premiums starting in June 2021. The rule immediately faced legal challenges, and was in effect for just a few months until it was overturned in court.
But the episode allowed researchers to evaluate the effect of credit factors on insurance premiums. When the rule took effect, people with the lowest credit scores saw a decrease in premiums of about $175 annually while those with the highest scores saw an increase of about $100, the NBER analysis found.
“We could see the dynamics of insurance pricing for the same households over time,” said Benjamin Keys, a professor at the University of Pennsylvania’s Wharton School, who co-authored the paper.
What homeowners paid before and after a ban on credit-based pricing in Washington State
Values compared with premiums paid by homeowners with “medium” credit scores (717 to 756)
In Minnesota, where Tara Novak, Petra Rodriguez and Audrey Thayer live, a state task force looked at ways to lower insurance costs for residents. It recently considered a ban or limit on the use of credit scores to set rates, but did not move forward with a recommendation.
Ms. Rodriguez said she doesn’t think it’s fair that her friend Ms. Novak should have to pay so much more for insurance to live in an identical house.
A credit score doesn’t capture anything about a person’s habits, or what they’re like as a tenant, or even years of on-time rent payments, she said. “It’s not who you are,” she said.
Methodology
Home insurance policy rates were supplied by Quadrant Information Services, an insurance data solutions company. The rates shown are representative of publicly sourced filings and should not be interpreted as bindable quotes. Actual individual premiums may vary.
‘States with the biggest pricing gaps’Rates shown are based on a home insurance policy with $400,000 of dwelling coverage and a $100,000 liability limit on a new home, for a homeowner age 50 or younger. Rates are averaged for all the individual company filings represented in the sample, which add up to a majority of the market share in each state but do not cover all active insurers in the state. Rates are also averaged to the state level from zip code level data.
‘The credit penalty in each state’Each insurance company incorporates credit history information differently, often using proprietary methods, so the scores do not map directly to FICO credit scores.
‘What homeowners paid before and after a ban on credit-based pricing in Washington State’Data shown are based on observations of real home insurance policies and homeowner credit scores from ICE McDash analyzed by the researchers of Blonz, Hossain, Keys, Mulder and Weill (2026). The price comparisons across credit score tiers controlled for variance in disaster risk, insurance policy characteristics, geography, and other year to year fluctuations.
Science
What to plant (and what to remove) in California’s new ‘Zone Zero’ fire-safety proposal
After years of heated debates among fire officials, scientists and local advocates, California’s Board of Forestry and Fire Protection released new proposed landscaping rules for fire-prone areas Friday that outline what residents can and can’t do within the first 5 feet of their homes.
Many of these proposed rules — designed to reduce the risk of a home burning down amid a wildfire — have wide support (or at least acceptance); however, the most contentious by far has been whether the state would allow healthy plants in the zone.
Many fire officials and safety advocates have essentially argued anything that can burn, will burn and have supported removing virtually anything capable of combustion from this zone within 5 feet of houses, dubbed “Zone Zero.” They point to the string of devastating urban wildfires in recent years as reason to move quickly.
Yet, researchers who study the array of benefits shade and extra foliage can bring to neighborhoods — and local advocates who are worried about the money and labor needed to comply with the regulations — have argued that this approach goes beyond what current science shows is effective. They have, instead, generally been in favor of allowing green, healthy plants within the zone.
The new draft regulations attempt to bridge the gap. They outline more stringent requirements to remove all plants in a new “Safety Zone” within a foot of the house and within a bigger buffer around potential vulnerabilities in a home’s wildfire armor, including windows that can shatter in extreme heat and wooden decks that can easily burst into flames. Everywhere else, the rules would allow residents to maintain some plants, although still with significant restrictions.
The rules generally do not require the removal of healthy trees — instead, they require giving these trees routine haircuts.
Once the state adopts a final version of the rules, homeowners would have three years to get their landscaping in order and up to five years for the bigger asks, including removing all vegetation from the Safety Zone and updating combustible fencing and sheds within 5 feet of the home. New constructions would have to comply immediately.
The rules only apply to areas with notable fire hazard, including urban areas that Cal Fire has determined have “very high” fire hazard and rural wildlands.
Officials with the Board will meet in Calabasas on Thursday from 1 p.m. to 7 p.m. to discuss the new proposal and hear from residents.
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Some L.A. residents are championing a proposed fire-safety rule, referred to as “Zone Zero,” requiring the clearance of flammable material within the first five feet of homes. Others are skeptical of its value.
Where is the Safety Zone?
The proposed Safety Zone with stricter requirements to remove all vegetation would extend 1 foot from the exterior walls of a house.
In a few areas with heightened vulnerabilities to wildfires, it extends further.
The Safety Zone covers any land under the overhang of roofs. If the overhang extends 3 feet, so does the Safety Zone in that area. It also extends 2 feet out from any windows, doors and vents, as well as 5 feet out from attached decks.
What plants would be allowed in the Safety Zone?
Generally, nothing that can burn can sit in the Safety Zone. This includes mulch, green grass, bushes and flowers.
What plants would be allowed in the rest of Zone Zero?
Homeowners can keep grasses (and other ground-covers, like moss) in this area, as long as it’s trimmed down to no taller than 3 inches.
The rules also allow small plants — from begonias to succulents — up to 18 inches tall as long as they are spaced out in groups. Residents can also keep spaced-out potted plants under this height, as long as they’re easily movable.
What about fences, trees and gates?
Any sheds or other outbuildings would need noncombustible exterior walls and roofs in Zone Zero — Safety Zone or not.
Residents would have to replace the first five feet of any combustible fencing or gates attached to their house with something made out of a noncombustible material, such as metal.
Trees generally would be allowed in Zone Zero. Homeowners would need to keep any branches one foot away from the walls, five feet above the roof and 10 feet from chimneys.
Residents would also have to remove any branches from the lower third of the tree (or up to 6 feet, whichever is shorter) to prevent fires on the ground from climbing into the canopy.
Some trees with trunks directly up against a house in this 1-foot buffer or under the roof’s overhang might need to go — since keeping branches away from the home could prove difficult (or impossible).
However, the board stressed it wants to avoid the removal of trees whenever feasible and encouraged homeowners to work with their local fire department’s inspectors to find case-by-case solutions.
What’s new and what’s not
Some of the rules discussed in Zone Zero are not new — they’ve been on the books for years, classified as requirements for Zone One, extending 30 feet from the home with generally less strict rules, and Zone Two, extending 100 feet from the house with the least strict rules.
For example, homeowners are already required to remove any dead or dying grasses, plants and trees. They also have to remove leaves, twigs and needles from gutters, and they already cannot keep exposed firewood in piles next to their house.
Residents are also already required to keep grasses shorter than 4 inches; Zone Zero lowers this by an inch.
Science
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Science
1,200% jump in kratom-related calls to poison control centers in last decade, analysis shows
Over the last decade, poison control centers around the country have received tens of thousands of calls from consumers of kratom products reporting adverse and life-threatening health effects, with researchers saying reports in 2025 reached a new level. California’s poison center is reporting similar findings.
Last month, researchers analyzed information from the National Poison Data System and found that between 2015 and 2025, poison control centers across the nation received 14,449 calls related to kratom. More than 23% of those calls, or 3,434, were made last year, according to a published report in the Centers for Disease Control and Prevention. That represents a more than 1,200% increase from 2015, when only 258 calls were reported.
Officers gather illegally grown kratom plants in 2019 in Phang Nha province, Thailand. The country decriminalized the possession and sale of kratom in 2021.
(Associated Press)
Kratom is derived from the leaves of Mitragyna speciosa, a tree native to Southeast Asia. It has a long history of being used for chronic pain or to boost energy and in the U.S., research points to Americans also using it to alleviate anxiety. In low doses, kratom appears to act as a stimulant but in high doses, it can have effects more like opioids.
But in the last few years, a synthetic form of kratom refined for its psychoactive compound, 7-hydroxymitragynine or 7-OH, has entered the market that is highly concentrated and not clearly labeled, leading to confusion and problems for consumers. The synthetic form gaining momentum in the market is sparking concern among public health officials because of its ability to bind to opioid receptors in the body, causing it to have a higher potential for abuse.
Los Angeles County leaders, meanwhile, have grappled with differentiating the two and regulating the products that come in the form of powder, capsules and drinks and have been linked to six county deaths. Sales of kratom and 7-OH products were banned in the county in November.
In reviewing the data, which did not differentiate whether callers had consumed natural or synthetic kratom, researchers set out to understand the effect of what they believe is a “rapidly evolving kratom market,” and highlight the role poison centers can play as an early warning surveillance system to detect new trends.
National Poison Data System findings
The data showed that over the last 10 years, 62% of the kratom-related calls to poison control centers were from people who said they consumed the drug by itself, and the other 38% were from people who combined it with another substance or substances.
Those who consumed kratom with another substance combined it most frequently with one or a combination of the following: alcohol, opioids, benzodiazepines (like Xanax or Valium), cannabis and cannabinoids, stimulants and antidepressants.
The data also broke down hospitalizations related to kratom — adults who took it alone or in combination and experienced “adverse” health effects; and adults who took it alone or in combination and experienced more serious “moderate” or “major” health effects, including death.
Kratom powder products are displayed in a smoke shop in Los Angeles in 2024.
(Michael Blackshire/Los Angeles Times)
Hospitalizations for adults who had consumed kratom alone and experienced adverse effects increased from 43 in 2015 to 538 in 2025. For those who took it in combination and were hospitalized with an adverse health effect, the total jumped from 40 in 2015 to 549 last year.
The numbers were even higher for hospitalizations where the health effects were more serious or fatal.
In 2015, there were 76 reports of people being hospitalized after taking kratom alone and experiencing a serious health effect or dying. By last year, that number had climbed to 919. The reports of serious health effects, including death, for those who took kratom in combination with another substance grew from 51 in 2015 to 725 last year.
The research does not break down kratom-related deaths by year but states that there were 233 deaths over the 10-year study period, or just over 3% of all 7,287 serious medical outcomes. Of the total number of kratom-related deaths, 184 cases involved the consumption of multiple substances.
What California’s poison control system found in its state data
The California Poison Control System is currently reviewing its data concerning kratom-related calls but an initial analysis shows parallels to the national report, said Rais Vohra, medical director of the state poison control system.
“We have about 10% of the national population and about 10% of the national call volume with poison control,” Vohra said. “And so, not surprisingly, we were able to identify over 900 cases of calls related to kratom in that same period.”
Local researchers are still deciphering the state data but they too have found that kratom-related calls are climbing.
“It’s accelerating, which I think is one of the main points of the [published] report,” Vohra said.
A majority of calls received by poison control come from healthcare facilities where “presumably someone has a problem … severe enough to warrant calling 911 or going to the emergency room, and that’s when our agency gets involved,” Vohra said.
Kait Brown, clinical managing director for America’s Poison Control Centers, said the fact that kratom and 7-OH are federally unregulated products sold online, in gas stations and smoke shops gives people across the country easy access.
And while kratom enthusiasts maintain that it has been used in its natural form for hundreds of years, “there are new formulations that are a little bit different than how people have used it, at least historically,” said William Eggleston, a pharmacist and the assistant clinical director of the Upstate New York Poison Center in Syracuse.
People are no longer consuming kratom only as a powder or capsule but also in the form of an energy shot or extract; it’s similar for synthetic, more concentrated 7-OH products.
When regional poison centers compare their findings and experiences with the analysis of calls in the National Poison Data System, Eggleston said, “undeniably there is an increase in calls related to kratom.”
“But when you put it in the bigger perspective of all the calls … this is still a very small percentage of what we’re dealing with on a day to day basis,” he said.
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