Money is getting harder to come by and keep. It’s even harder to find more places to save when you’ve already scrimped so much.
But don’t give up looking just yet. Have you looked at your auto insurance policy lately? You can’t do without car insurance—but can you do better on your monthly car insurance premiums? Are you shelling out too much on these monthly payments when just a little more insight could help you save significantly?
Remember, saving money on insurance isn’t just about getting lower premiums. There are a lot of discounts you might be missing out on if you didn’t report the most accurate personal information, ask your questions carefully, or take the time to weigh the pros and cons of your insurance company.
Now’s the time to give your insurance a second look.
Today, just about every piece of information you can think of has gone digital. The more information a computer has (on you, on insurance companies, on auto-related figures, etc.), the better answer it spits out when asked: Where can I get cheap car insurance quickly?
How does all that magic happen? How does Insurify personalize and simplify the auto insurance buying experience from the shopper’s perspective? It’s pretty basic. Let’s figure out first what types of digital data it takes to make this site so efficient and provide interested drivers with the best rates possible.
Scores 1 and 2: A tale of two credit scores
Insurance companies use two different scores when deciding to insure you and how much they’ll charge.
The first is your credit score—something you’re likely already familiar with. If not, here’s a brief explanation: Your credit score reflects how financially responsible you have been when it comes to paying your debts (on time, etc.). The more responsible you are, the higher your score will be, and the more likely you are to get a better rate or qualify for other discounts. Late payments, bankruptcies, etc. are all events that negatively affect this score. If you are interested in finding your current credit score or learning more about credit scores in general, the FICO score is one of the most common. (Note: As of August 2019, auto insurers in California, Hawaii, and Massachusetts cannot use a driver’s credit history—even a good credit history—to determine rates or eligibility.)
The second score that insurers consider when determining rate and eligibility is your “auto insurance score.” Your auto insurance score reflects your driving history and habits, as well as how likely you are to file a claim (your risk). For example, younger drivers statistically have more accidents and therefore have auto insurance scores that reflect that heightened risk. Heightened risk, in turn, is associated with more insurance claims and rewarded with higher premiums to make up for projected future costs.
It’s a good idea to keep these scores in mind and work to elevate your credit score whenever you can. Here’s why:
A bad credit score can affect your auto insurance score.
Think about it. If your payment history is spotty, you’ve defaulted on a loan, or you’ve claimed bankruptcy, your credit rating essentially says to the insurer reviewing it, “This one’s a risk. Watch out.”
Even if you have no blemishes on your claims history, insurance companies use the information from your credit score to better predict which shoppers pose a more significant claim risk. In turn, insurers charge these riskier drivers a higher premium upfront. It’s nothing personal, just a numbers game.
Credit information can be wrong.
Everyone makes mistakes—those crafting your credit reports are no exception. You’d be wise to monitor your credit report to make sure errors don’t pop up when you least expect it—and to keep healthy financial habits top of mind. How many credit cards do you have? How old are your lines of credit? Be on top of these critical data points.
You can explore alternative methods for raising a poor credit score.
These include Experian Boost™, which allows users to track monthly payments, including utility and mobile phone bills, to actively reward on-time payments.
Score 3: The Insurify Composite Score
Before digital information was so readily available, potential policyholders had to research companies one at a time—usually by phone—without the ability to instantly compare coverage options and quotes from multiple insurers.
Insurify developed its proprietary Insurify Composite Score to help guide shoppers in their search for a highly-customized car insurance solution. You can read more about the composite score and methodology here—and take a peek at the composite scores used to rank the 10 Best Car Insurance Companies for 2020. These comprehensive sets of data, along with Insurify’s predictive analytics algorithm, allows Insurify to provide shoppers with a handful of intelligently selected insurance options from providers they may have never found on their own—in minutes.
Click here to see Insurify’s full list of national and regional auto insurance companies.
My scores aren’t stellar—does that mean I’m stuck with a high premium for the next few years?
Not necessarily. Although it’s advantageous to work on raising your credit and ensuring a good auto insurance score, Insurify can still help you find insurers with lower rates if you qualify. More and more companies and discounts are being added to the Insurify marketplace every month. For you, that means more opportunities to save on your car insurance rates.
Credit Score and Car Insurance: FAQs
How does my credit score affect my car insurance rates?
Your credit score reflects how financially responsible you have been when it comes to paying your debts (on time, etc.). The more responsible you are, the higher your score will be, and the more likely you are to get a better car insurance rate or qualify for other discounts. Late payments, bankruptcies, etc. are all events that negatively affect this score. Auto insurers in California, Hawaii, and Massachusetts cannot use a driver’s credit history—even a good credit history—to determine rates or eligibility.
How can I improve my credit score?
Get all bill payments and credit card statements in on time. The less you default on credit, and the more you stay on top of your monthly expenses, the healthier your credit history will be. The frequency of your use of credit, the age of your lines of credit, and the number of credit inquiries all impact your credit profile, so be careful that you’re not overdrawing on credit and paying back loans as soon as you possibly can. Insurers will see your fiscal responsibility as evidence that you can afford the best and cheapest car insurance policy for you.
Where can I compare car insurance quotes regardless of my credit history?
Low credit scores aren’t ideal, but they’re also not standing in the way of securing a car insurance policy. Use a car insurance quotes comparison site like Insurify to get tailored, real quotes for you in just minutes. Whether you have poor or excellent credit, you won’t be turned away. Choose from up to 10+ car insurance companies at the coverage levels of your choice.
The Bottom Line
The best way to know how much you’ll be paying for car insurance TODAY is to get multiple car insurance quotes TODAY!
Even if you have some work to do before your credit and auto insurance scores can reflect a flawless driving record, Insurify is the place to go to find the lowest auto insurance quotes that fit your financial and driver profile. Just answer a few questions (don’t worry, we believe in making things as painless as possible), and Insurify will return up to 10+ real quotes that could save you the kind of money you’ve been looking for by the end of the day. It’s all very effortless and, best of all, free.