When you mention credit score probably the furthest thing from your
mind would be insurance premiums. That way of thinking though maybe
changing for many people who are seeing increased insurance premiums.
Most people do not realize the impact that credit scores can have on
your insurance premiums. Let us take a closer look at credit scores and
how they affect your premiums.
Years ago credit scores were not even talked about as a factor in
what you pay for your insurance. Insurers though have found some
interesting facts when you factor credit scores into the equation.
People with lower credit scores are more likely to file insurance
claims. Studies also indicated that drivers with higher credit scores
have fewer accidents as well. These numbers were sobering to insurers
and they started to add credit scores as part of the process in
figuring what to charge for premiums. Not every insurance company uses
credit scores, but the majority of them do to figure premiums. This
does not mean though you cannot lower your premiums.
One of the first things you will want to work on is increasing your
credit score. First you will need to get your credit report and see
what is on it. If you have any outstanding items on it get them taken
care of as soon as possible. Anything that is on the report you
disagree with also get it corrected. No one is perfect and even some
credit reports have mistakes on them. Always try to pay your bills on
time as well. Insurance companies look at how prompt you pay
everything. Avoid applying for new credit cards as well. The more
inquiries into your credit report the more chances your credit score
can go lower. Try to lower your debt to credit ratio as well. It is
something that can really affect your credit score.
Insurance premiums continue to rise these days and credit scores
are just part of it. If you want to lower those insurance premiums
protecting your credit score has become a must. More and more people
are just learning how much a credit score can affect their everyday