When it comes to car insurance, many insurance companies will also take your credit score into consideration when it comes to determining the cost of your coverage (or whether to even extend coverage at all) if you are applying for insurance.
Even with a spotless driving record, this can be the case.
You see, for insurance companies, it’s all about statistics and risk factors. Many insurance companies believe that mediocre to poor credit ratings equate to higher insurance risks.
So, if you’re not the best at getting your credit card payments in the mail on time you may want to stop and think about changing your payment habits and make more of an effort to improve your payment track record. Whether we as individuals perceive this to be true at all or not, almost all auto insurers use your credit score in the mix to some degree when determining your premium.
Knowing this makes it even more important for you to know exactly what your credit score is – and why it is what it is. In other words, even if you believe you’ve never been late on any payment, credit reporting companies are far from flawless. There could be mistakes or even misrepresentations on your report that could cause to have your insurance rated (higher bracket) or even denied.
It is worth the effort to take a few minutes (and you can do very easily online) and get your credit report. You can also check out your FICO (Fair, Isaacs & Co) score – which is what most insurance companies use to factor your credit rating into the cost.
A driver with bad credit is going to pay more for their insurance than those with good credit.
If you do have bullet-proof credit, this is all the more reason for you to shop your insurance rates. You may find an insurance company that offers bigger discounts for A+ credit ratings – which is why shopping with an Agency who can do that work for you is a major benefit.
To review your rates across top-rated Carriers, click the link below!