Credit Score Impact on Insurance Rates

Posted on | November 21, 2007 | No Comments

(Thanks to Kathy McGraw-Comisar of HUFF REALTY Insurance for this informative article)

It is important, for the consumer, to understand that an insurance score is not the same thing as a credit score. Both are derived from the information found in your credit report, but they predict very different things. A credit score predicts how likely you are to repay a loan or other credit obligations. When you apply for insurance, the insurance company orders credit information from one or more of the three major U.S. credit bureaus. They look at thinks like payment history, collections, credit utilization and bankruptcies. If you have “maxed out” credit cards, it will negatively affect your score, resulting in a higher insurance premium.

An insurance score uses information from your credit report to predict how often you are likely to file claims, and/or how expensive those claims will be. The way you handle your credit says a lot about how responsible you are. Insurance companies want to reward responsible people by offering them better insurance products and by charging them lower rates. That’s why insurance scores are so useful.

At HUFF Realty Insurance, we shop for the most competitive pricing and the insurance that will provide the best coverage for our clients. Give me a call today for a free insurance evaluation to find the best coverage that meets your needs.

Kathy can be reached at (859) 578-4914 and kmcomisar@huff.com

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