Did you know your insurance rates depend on your credit score? Here are a few fun facts about credit history and insurance.
When your insurer is deciding how much to charge you for coverage, they need to figure out how risky you are. To do that, they’ll look at your claims history, profession, and – surprise! – Your credit score. As it turns out, a good credit history makes you statistically less likely to file a claim. Which means the higher your score, the less you’ll pay for insurance. Here’s some more interesting information about the relationship between your insurance rates and your credit score.
- Your insurance credit score is different from your standard credit bureau score. While credit card companies and mortgage lenders will generally look at your FICO score, the score insurers use is slightly different. Each insurer will plug your credit bureau score into their own complex formula to come up with your insurance score.
- Different insurers place different emphases on your score. If you have poor credit, don’t despair! Each insurer values credit history differently. Have your independent insurance agency get you rates from multiple insurers to make sure you’re getting the best price on your policies.
- Credit comes into play with personal and commercial insurance. In the same way your personal credit history will affect the cost of your personal coverage, business’s credit management will impact their rates. The business insurance credit scores that insurers use factor in things like whether or not the company has paid bills on time, whether its industry is healthy, and the size of the business.
If you’d like more information about how your credit score impacts your insurance rates, contact Humble & Davenport Insurance. We can give you insider insight and show you why you pay what you do for personal and commercial insurance in Seattle, Renton, or the surrounding Washington areas.