An extraordinary life circumstances exception is when an insurance company takes into account the fact that an unusual event has taken place which could potentially throw off a person's credit score.
If an insurance applicant or policyholder qualifies for an extraordinary life circumstances exception, their credit score may not be counted as a factor for an insurance decision.
For example, if a sudden medical emergency causes their credit score to suffer, they may receive an exception. So, if they were applying for auto insurance, the insurer cold overlook their credit score when coming to a decision about their coverage.
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