Companies Now Use Social Media to Determine Insurance Rates

What you post on Facebook or other social media websites like Twitter or MySpace maybe used in determining insurance rates.

According to industry expert, Michelle Megna, managing editor for stated, vendors are building tools to allow companies to automatically mine digital data about customers.

Douglas Heller executive director of Consumer Watchdog also said they’ll use this information to determine how much to charge you or whether or not to insure you.

“Your digital DNA is a gold mine to companies.” explains Michael Fertik, CEO

I personally knew a young guy who was injured while working and was collecting workers compensation. For whatever reason, he posted ski pictures of himself from the year prior. The insurance investigation was ready to file fraud charges against him unless my friend supplied them a receipt from the trip proving the dates.

Social media should not be viewed as a bad thing. If you post your healthy lifestyle habits or photos of your humanitarian efforts, companies should recognize what a good person you are.

This may actually be a fix to the credit crisis. Someday, I’ll walk into the bank with my social media score and buy a house.