Too many bills? Too much credit card debt? That can impact your insurance rate. Photo Courtesy: InsuranceRates.com
Here’s another reason not to let those bills go unpaid: damaging your credit record can add significantly to the cost of operating your automobile.
A new study reveals that drivers with poor insurance scores pay nearly twice as much for auto insurance as those with excellent scores. Even those with average ratings can wind up paying a premium, according to the report prepared for InsuranceQuotes.com.
“Considering all of the factors that go into car insurance rates, credit is actually one of the easiest to control,” said Laura Adams, senior insurance analyst, InsuranceQuotes.com.
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Insurance scores are very similar to the credit scores that can influence whether you can get a car loan, for example, and what inter rate you’ll pay. Both are calculated using such factors as credit card balances, late payments and credit inquiries, though insurance companies use a proprietary scoring strategy and are looking to predict the likelihood that you might file a claim in the future.