Do car insurance companies check credit scores before they decide to offer you a policy? This is an important question and it’s one we’re going to cover in today’s post!
Do car insurance companies do credit checks?
Since the 1990s, car insurance companies have been checking credit scores. But this isn’t the same as the credit score you might be used to. Instead, insurance companies look at your insurance credit score. It’s calculated in the same way as your typical FICO score, but it takes different factors into account and weighs certain factors differently.
Insurance credit scores
To get your insurance credit score, your credit report is run through an algorithm that determines your insurance credit score, and this is largely based on your risk as a driver.
There isn’t an exact formula that can tell you how your premium might change based on your insurance credit score. This will largely depend on the provider you choose. But as with any type of risk, the higher your risk is determined to be, the more you can expect to pay for insurance.
What else affects the price of car insurance?
Your insurance credit score isn’t the only factor taken into account when pricing your policy. There are a number of other things your premium price will be based on, including:
- The level of coverage you choose
- Your driving history
- Your age
- The vehicle you drive
- Your commute
- Driving conditions in the area
- Crime rates near you
- Your annual mileage
How to save on car insurance
Some things, like your age, aren’t in your control. But there are still many things you can do to save on car insurance and make sure you’re getting the best coverage at the best price.
Here are a few ideas:
- Take an accredited safe driving course
- Keep a clean driving record
- Add safety or anti-theft features to your vehicle
- Inquire about discounts, including bundling discounts or loyalty discounts
As always, when you have questions about car insurance in Salt Lake City, you can count on ASA Insurance to provide you with the answers and information you need! Contact us today.
