Good Credit Impacts Insurance Rates Too

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Good Credit Impacts Insurance Rates Too

Posted On : Aug-24-2011 | seen (578) times | Article Word Count : 704 |

If you have a good credit rating you stand a better chance at saving on your annual auto insurance premiums, among other things.

Naturally, when we think of our credit scores we think about being able to qualify for a loan for a home, a new car, a luxury item like a boat.

Even apartment and condo rental agencies will look at your credit score to determine whether you’d be a solid tenant. Now, a new study from CarInsurance.com has come out with data that shows anyone with credit scores above 750 can expect to save on average $783 annually on their car insurance premiums.

According to the study, roughly 40 % of the population has credit scores above 750, which are considered to be excellent scores by most rating agencies, banks, mortgage companies and, as the study suggests, car insurance companies.

The study also suggests that, because the average score is roughly 680, there a many drivers out there who are paying a premium for their car insurance. Even those with scores of 750 could see some improvement, given the fact that the popular consumer Fico score range goes all the way up to 850.

So what about those with less-than-stellar credit? What can they expect to be paying for their insurance premiums? Statistics show that a young driver between the ages of 25 and 34 with a clean driving record and a credit score over 750 pays $1,155 annually for full coverage car insurance.

Meanwhile, similar drivers with credit scores of 650 to 749 pay an average of $1,658 and those with credit scores between 500 to 649 pay $2,023.

If you don't even have a credit score, thanks to insufficient data, you'll be looking at an average insurance premium of $2,182. The average premium for all drivers age 25 to 34 is $1,938, according to online sources.

The numbers are pretty similar in other age brackets as well, meaning your credit score is a significant factor in setting your insurance premium rates.

So instead of focusing simply on your choice of vehicle and desired coverage, get to know your credit score long before shopping for car insurance. Do everything you can to pay down debt and boost your credit score, including calling the major reporting agencies and making sure old items are cleaned off your credit report.

There are a lot of ways to clean up your credit report. Here are few tips for doing so:

Check your credit report for free once a year. Check out annualcreditreport.com the only authorized online site that can provide a free credit report for you from any of the three major credit reporting agencies: TransUnion, Experian and Equifax.

Check your payment history against account balances and details: Compare the financial payment information, credit limits and account details with your credit and bank statements to make sure everything is being accounted for. If you think the data contains errors, write to the credit bureau highlighting the inaccuracies with an explanation of why you think the details are wrong. Include a copies of any documents that confirm what you say.

Pay your bills on time: Late fees look ugly on your credit report, especially regarding payments for bank loans and mortgages. This is probably the most important single action anyone can take to rebuild their credit profile. One quick and easy way to make sure you pay on time is to establish automatic bank payments from your checking account.

Don’t ignore debt: Credit providers will help someone facing up to debt problems, but ignoring payments and trying to borrow to get out of debt are likely your situation harder and keep you in debt longer.

Tip 7 - How long information stays on your report: Credit indicators stay on your credit report for different lengths of time, depending on what type of information they show.

Don’t Over-apply: Credit searches stay on your profile for two years. Too many inquiries from credit providers will mark down your score.

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<h1>Good Credit Impacts Insurance Rates Too</h1> Author: <a href='http://www.articleseen.com/profile_Richard Milano.aspx'>Richard Milano</a> Naturally, when we think of our credit scores we think about being able to qualify for a loan for a home, a new car, a luxury item like a boat.

Even apartment and condo rental agencies will look at your credit score to determine whether you’d be a solid tenant.  Now, a new study from CarInsurance.com has come out with data that shows anyone with credit scores above 750 can expect to save on average $783 annually on their car insurance premiums.

According to the study, roughly 40 % of the population has credit scores above 750, which are considered to be excellent scores by most rating agencies, banks, mortgage companies and, as the study suggests, car insurance companies.

The study also suggests that, because the average score is roughly 680, there a many drivers out there who are paying a premium for their car insurance. Even those with scores of 750 could see some improvement, given the fact that the popular consumer Fico score range goes all the way up to 850.

So what about those with less-than-stellar credit?  What can they expect to be paying for their insurance premiums?  Statistics show that a young driver between the ages of 25 and 34 with a clean driving record and a credit score over 750 pays $1,155 annually for full coverage car insurance.

Meanwhile, similar drivers with credit scores of 650 to 749 pay an average of $1,658 and those with credit scores between 500 to 649 pay $2,023.

If you don't even have a credit score, thanks to insufficient data, you'll be looking at an average insurance premium of $2,182. The average premium for all drivers age 25 to 34 is $1,938, according to online sources.

The numbers are pretty similar in other age brackets as well, meaning your credit score is a significant factor in setting your insurance premium rates.

So instead of focusing simply on your choice of vehicle and desired coverage, get to know your credit score long before shopping for car insurance.  Do everything you can to pay down debt and boost your credit score, including calling the major reporting agencies and making sure old items are cleaned off your credit report.

There are a lot of ways to clean up your credit report.  Here are few tips for doing so:

Check your credit report for free once a year. Check out www.annualcreditreport.com the only authorized online site that can provide a free credit report for you from any of the three major credit reporting agencies: TransUnion, Experian and Equifax.

Check your payment history against account balances and details: Compare the financial payment information, credit limits and account details with your credit and bank statements to make sure everything is being accounted for. If you think the data contains errors, write to the credit bureau highlighting the inaccuracies with an explanation of why you think the details are wrong. Include a copies of any documents that confirm what you say.

Pay your bills on time: Late fees look ugly on your credit report, especially regarding payments for bank loans and mortgages. This is probably the most important single action anyone can take to rebuild their credit profile.  One quick and easy way to make sure you pay on time is to establish automatic bank payments from your checking account.

Don’t ignore debt: Credit providers will help someone facing up to debt problems, but ignoring payments and trying to borrow to get out of debt are likely your situation harder and keep you in debt longer.

Tip 7 - How long information stays on your report: Credit indicators stay on your credit report for different lengths of time, depending on what type of information they show.

Don’t Over-apply: Credit searches stay on your profile for two years. Too many inquiries from credit providers will mark down your score.About the Author: To know more about Credit Cards please browse <a rel="nofollow" href="http://www.approvals.com/">Credit Cards</a> , You can also visit <a rel="nofollow" href="http://www.approvals.com/">Credit Cards for Bad Credit</a>
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