Why Do Insurance Companies Base Rates on Credit Scores?<\/h2>\n\n\n\n
Many insurers regard your credit score as a reflection of your personal responsibility and overall commitment to paying your bills. And, if you\u2019re habitually late or miss paying them, no matter the reason, your credit score will obviously be lower than someone who shows dedication in paying their obligations on time. To compound the issue, if you have a history of tardiness or defaulting on your credit card payments, you\u2019ll be statistically judged as a greater risk behind the wheel\u2026whether that\u2019s true or not.<\/p>\n\n\n\n
According to a paper published in 2020<\/a> by the National Association of Insurance Commissioners\u2019 Journal of Insurance Regulation, insured drivers with the lowest credit scores had the greatest amount of losses. And it\u2019s not just credit scores, but lower educational levels, occupations and more that are used as determinants for insurance premiums.<\/p>\n\n\n\n Some states have outlawed insurance companies using credit scores to set rates, including California<\/a>, Hawaii, Maryland, Massachusetts, Michigan, Oregon and Utah. Other states are making it harder.<\/p>\n\n\n\n During tough economic times, almost anyone can face hardships that can change good credit to bad rather quickly. The loss of a job, a serious medical issue, a death or divorce can wipe out your bank accounts and leave your credit in a tail spin. Unfortunately, once your credit is shot, it can affect many things, including the interest rate you\u2019ll pay should you want to buy a car<\/a>, not to mention the insurance rate you\u2019ll pay to insure it.<\/p>\n\n\n\n While you can reduce certain expenses by cutting back on energy usage, entertainment, and dining\u2026you can\u2019t cut back on car insurance<\/a>. It\u2019s a requirement if you own a car and plan on driving it. And, if you\u2019re trying to get quotes for cheap car<\/a> insurance or simply reduce the cost of your existing premium, your credit score can affect the outcome.<\/p>\n\n\n\n Yes, you can get cheap auto insurance<\/a>. It just means you have to shop around and do everything you can to improve and manage your credit score. In case you\u2019d like to know how to do that\u2026below are a few tips to help raise your credit score and make your insurance shopping easier.<\/p>\n\n\n\n Credit scores are one way insurance carriers set rates. But there are plenty of things you can do to help lower your auto insurance while you are working to rebuild your credit. Let\u2019s take a look at a few of those and how they work.<\/p>\n\n\n\n There are as many car insurance discounts<\/a> as there are cars, it seems. If you take the time to talk with your agent and do a little research, you are sure to qualify for some of them. For example, if you haven\u2019t had an accident or ticket in 3-5 years, you probably qualify for a good driver discount<\/a>. If you take a defensive driving course<\/a>, you will most likely be eligible for a discount. Installing anti-theft devices<\/a> on your car can also earn you a discount.<\/p>\n\n\n\n If you can afford it, choose a higher deductible<\/a>. Raising your deductible from $500 to $1,000 means your insurance company won\u2019t have to come up with as much if you file a claim. That makes them very happy.<\/p>\n\n\n\n When you are in the market for new wheels (new to you anyway), choose a vehicle that will be easy and cheap to repair \u2013 and that isn\u2019t eye candy to thieves. Your insurance company will reward you with lower premiums<\/a>.<\/p>\n\n\n\n If you\u2019re looking to lower your premiums, make sure you\u2019re getting the best rate on your car insurance by shopping around. Why not get a free auto insurance quote<\/a> online today? Feel free to give us a call at (800) 777-5620<\/a> or stop by one of our convenient locations<\/a>, as well. Our agents are here to help you find auto insurance you can afford!<\/p>\n","protected":false},"excerpt":{"rendered":" Does My Credit Score Affect My Car Insurance Rate? It depends. Some states are getting away from allowing insurance companies to look at credit scores when setting car insurance rates. But many other states still have no laws on the books to stop this practice. In many cases, when it comes to auto insurance\u2026your credit […]<\/p>\n","protected":false},"author":1002598,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[85],"importance":[],"type-content":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/posts\/1486"}],"collection":[{"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/users\/1002598"}],"replies":[{"embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/comments?post=1486"}],"version-history":[{"count":9,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/posts\/1486\/revisions"}],"predecessor-version":[{"id":8804,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/posts\/1486\/revisions\/8804"}],"wp:attachment":[{"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/media?parent=1486"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/categories?post=1486"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/tags?post=1486"},{"taxonomy":"importance","embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/importance?post=1486"},{"taxonomy":"type-content","embeddable":true,"href":"https:\/\/www.freeway.com\/knowledge-center\/wp-json\/wp\/v2\/type-content?post=1486"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}It\u2019s Not My Fault My Credit Score Went Down<\/h2>\n\n\n\n
![\"Man](\"https:\/\/www.freeway.com\/knowledge-center\/wp-content\/uploads\/sites\/2\/2022\/08\/freeway-credit-scores-not-just-a-number.jpg\")
<\/figure><\/div>\n\n\n\nCan I Still Find Cheap Car Insurance?<\/h2>\n\n\n\n
Ways to Lower Your Car Insurance<\/h2>\n\n\n\n
Car Insurance Discounts<\/h3>\n\n\n\n
Higher Deductible<\/h3>\n\n\n\n
Buy a Safer Vehicle<\/h3>\n\n\n\n
Find Affordable Car Insurance Quotes Online Today<\/h2>\n\n\n\n