What is an auto insurance score?

Your auto insurance score is very similar to your credit score. The biggest difference between the two, is your car insurance score is used to predict your likelihood of filling a claim. Credit score is obviously based off your likelihood of not paying your bill on time or defaulting on the loan. 

Keep in mind, your personal driving record has no effect on your auto insurance score. Although it is a determining factor when calculating your auto insurance premium. 

Credit History and it’s Effect on Auto Insurance Rates

California and Hawaii do not consider credit history when determining your auto insurance rate.  Other states will use your credit history to effect your auto insurance premium. It’s always best to get in contact with a local official or agent in your area to find out what the exact guidelines are. 

If you are planning on leasing or buying a car in the future it’s important that you understand auto insurance scores in more detail. You could potentially have a more difficult time getting approved for a new policy if you decide to switch insurers. Below we will get into more detail regarding auto insurance scores. 

Auto Insurance Score & Auto Insurance 

Auto insurance companies are going to have different ideals in place for what they are going to consider a good score. There are a few auto insurance companies that may offer lower rates for a score in the 800’s and others that are happy to see a score in the 700’s. It is really a case to case basis when trying to narrow down when a certain discount will apply. 

Data Analytic Companies That Determine Auto Insurance Scores;

In addition to auto insurance companies viewing your auto insurance score through different goggles, the data analytic companies calculate your auto insurance in different ways. For example Fair Isaac Corporation has an auto insurance score range between 300 and 900, while ChoicePoint rates your auto insurance score from 300 to 997. If you are a customer with ChoicePoint you may be able to get your hands on a free report. 

With car insurance being a requirement to legally drive in the US, a low auto insurance score can be detrimental to to your financial landscape. For example if a poor auto insurance score affected your auto insurance premium by $30 per month, over time this can add up. In the first 12 months of the increase you’d encounter a $360 hike in premium. After 10 years you’d be looking at a $3,600 price increase in premium. I’m sure you can think of betters ways of spending your money, then increased auto insurance premiums. 

How is Your Car Insurance Score Calculated?

Your auto insurance score is an arbitrary number and is based off a series of factors. Those determining factors include driving history, vehicle type, driver information, credit score (some states), and claims history. Even neighborhood plays a part in calculating your premium. Auto insurance in Lodi Ca will be viewed differently than car insurance in Sacramento Ca. Below we go over these factors that can create a hike in your auto insurance score and your car insurance premiums;

Driving History

Driving record is used in every state when calculating car insurance rates. DUI’s, tickets, citations etc, all effect auto insurance premiums. Often hikes in rates can stay on your auto insurance premium for up to 10 years. Overtime cost increases like these add up. 

Driver Information

Your age, the neighborhood you live in, your vehicle type, marital status, and homeownership position all play a part in calculating your auto insurance premiums. We go over this in more detail in this article; https://eugenecyates.com/insurance-articles/how-much-does-car-insurance-cost/

Vehicle Type

Super cars come with super insurance premiums. They travel at higher speeds and come with increased risk. In an insurance companies mind, more risk equals higher premiums. In addition to that the cost to replace them is much higher than a normal sedan. 

Credit Score

A credit score is an accredited report and is primarily used to asses an individuals credit worthiness. In some states credit score is a major determining factor when calculating ones auto insurance score. Insurance companies use credit to factor an individuals reliability. A good credit score is proof that you are responsible with your bills and insurance companies have data that proves both go hand and hand. The FTC put out a report showing drivers with lower credit scores have more claims and their claims were of higher amounts, than drivers that had great credit. 

Claims History

Very similar to driving history, claims history is a major contributing factor when calculating your auto insurance score. At fault accidents are horrible for your auto insurance premium and score. Very much like a DUI, violations like these can stay on your record for up to 5 years. 

If you have any questions remain in regards to auto insurance score and are in California, please reach out to one of wonderful agents. They are incredibly knowledgeable and always happy to help. [click here to call an agent now]