Your Credit Score & Getting Auto & Home Insurance

Insurance companies require a lot of information these days. One of them is your social security number and getting an insurance score. An Insurance score is acquired by looking at your credit report. Even though there are no points taken away for this inquiry, it will affect the price of you insurance overall.

Why Look At Credit?

Studies by regulators, universities and independent auditors show that someones credit score, is a strong and indisputable way to determine if someone is going to file an insurance claim in the future. It’s also proven by personal experience at my insurance agency, Someone with a higher credit score is always going to get a lower premium. They also file a lot less claims from what I have seen too. Insurance companies also report that 2/3 of their clients get a lower rate, due to credit. So overall people with good credit like other things, will receive a better price and favoring.

Am I Going to Pay A really High Rate, Because I Have Bad Credit?

No. Just because someone has bad credit, doesn’t necessarily mean they are going to get ripped off. With our agency being independent, if one company has a higher rate due to credit, we will shop with another that doesn’t. There are companies who specialize in insuring people with bad credit. They always usually have a more competitive rate versus  the ones who don’t. It would also be a good idea to try to clean up your credit. There are many ways to do this. That way you don’t have worry about this in the future.

What Is An Insurance Score?

An Insurance score is obtained by looking at your credit report. It is not considered a credit check, nor are any points taken away. The reason is because you are not trying to truly obtain credit and insurance is pre-paid. Some insurance companies might look at all 3 bureaus, some might just look at 1. Once an Insurance Score is received, it is used as one of many factors, in determining someones insurance premium.

What If I Try To Hide My Credit From An Insurance Company?

“So I know I have bad credit, is trying to hide from the insurance company going to get me a better rate?” The answer is No. As a matter of fact when an insurance company can’t find someones credit, they are automatically going to tier you in the worst Insurance score in their system.(this is not reported to the 3 bureaus.) For example if an insurance company uses an A to Z insurance score platform, you will be placed as a Z. So honesty is the best way to go.

Will An Insurance Company Still Get An Insurance Score, Even Though I Don’t Give them My Social Security Number?

Yes, they will most of the time. They do this through you first, middle and last name. They also do this by using your address, date of birth, previous address and other factors. It is also clear to the agent our company, if an Insurance Sore is received. If one is not received, the system will clearly notify that there was “no-hit”.