Q)Is my insurance company allowed to run a credit check on me?
A) Sometimes. It varies from province to province as well as by the type of policy. For automobile insurance in Quebec, insurance companies are permitted to use credit checks as part of their process for determining rates but in Ontario the Financial Services Commission of Ontario (which is the governing body in Ontario) lists the criteria which an insurance company cannot use to determine rates. The criteria are as follows: credit history, bankruptcy, employment status, whether you have a credit card, how long you have lived in your current home, not-at-fault accidents, whether your vehicle is owned or leased and whether there was a period of time where you had no automobile insurance coverage.
An insurance company requires your permission to run a credit check.
It may be that your insurance company is asking for a credit check for your homeowner's policy, which is not subject to the criteria above.